Taxes

Taxes in Serbia

Serbia offers an attractive tax environment with flat rates and special incentives for newcomers and entrepreneurs.

Tax Residency

You're a Serbian tax resident if:

• You spend 183+ days in Serbia in a 12-month period
• Days can be consecutive or non-consecutive
• Center of vital interests is in Serbia

Tax treatment:

• Residents: Taxed on worldwide income
• Non-residents: Taxed only on Serbian-source income

Personal Income Tax

Standard flat rate: 10%

This applies to:

• Employment income
• Self-employment income
• Rental income (additional 20% withholding)

Tax-free threshold:

• First 25,000 RSD/month (~€213) is tax-free

Special Tax Rates

Tax Relief for Newcomers

70% tax reduction available if:

• You didn't predominantly live in Serbia for 24 months before employment, OR
• You're under 40 and lived abroad 12+ months for education/training

Benefits:

• 70% reduction in tax base
• 70% reduction in social security contributions
• Valid for 5 years from employment start date
• Significant savings for qualifying expats

Social Security Contributions

Contribution cap: 5x average annual salary

Annual Tax on Higher Earners

Additional tax for high earners:

• Threshold: 3x average annual salary (~€50,000)
• Progressive rates apply above threshold
• Only affects high-income earners

Self-Employment Taxation

Two options:

1. Taxable profit basis: Calculate actual profit (income - expenses)
2. Flat-rate taxation: Fixed income estimate, simpler but may be higher

For digital nomads and freelancers, actual profit basis often works better.

Corporate Tax

Flat rate: 15%

Benefits for companies:

• No minimum capital requirement
• Simple company formation
• Tax treaties with many countries
• Research & development incentives

VAT

Standard rate: 20%

Reduced rate: 10% (food, medicine, utilities)

Small businesses under 8 million RSD (~€68,000) annual turnover can opt out of VAT.

No CRS

Serbia is not part of the OECD Common Reporting Standard (CRS). This means:

• No automatic exchange of banking information
• Greater financial privacy
• Still must comply with home country tax obligations

Tax Filing

Deadlines:

• Annual tax return: May 15
• Employer handles withholding for employees
• Self-employed file quarterly estimates

Tax Treaties

Serbia has tax treaties with 60+ countries including:

• USA, UK, Germany, France
• Most EU countries
• China, Russia

These prevent double taxation.

Tips for Expats

1. Check if you qualify for the 70% tax relief - major savings
2. Consider company formation for tax efficiency
3. Understand your home country tax obligations
4. Serbia is not in CRS but you must still report globally
5. Consult a local tax advisor for complex situations