Income Taxes in Serbia: What Foreign Employees Should Know

If you’re a foreign citizen living or working in Serbia, understanding how income taxes apply to your situation is essential. Whether you’re here for business, work, or remote employment, knowing your tax obligations can save you time, stress, and penalties.

This guide covers three key scenarios:

1️⃣ If you’re employed by a Serbian company

What tax rate applies to your salary, how contributions are handled, and what tax incentives are available for newly arrived professionals.

2️⃣ If you’re self-employed or a freelancer registered in Serbia

What income counts as taxable, how you declare and pay taxes, and which expenses you can deduct.

3️⃣ If you’re a digital nomad or a remote worker employed by a foreign company

What happens when you’re physically present in Serbia but work for an international employer — including how Serbia defines tax residency and when you’re subject to local tax laws.

Foreign Employees in Serbia: Tax Rules Explained

Who Pays Income Tax in Serbia?

Every employee working in Serbia must pay personal income tax, including foreign nationals. The tax applies to income you receive from a formal employment contract, as regulated by Serbian labor law.

Income Tax Rate and Tax Base

Here’s how the system works:

• You pay a 10% income tax rate on your salary.

• However, your first 25,000 RSD of monthly income is tax-free in 2024.

• The state adjusts this non-taxable threshold every year, based on inflation data from the national statistics office.

So, you only pay tax on the portion of your salary above the exempt amount.

Who Handles the Tax Payment?

In Serbia, your employer takes full responsibility for paying your income tax.

They:

• Calculate the tax

• Withhold the correct amount from your salary

• Transfer it to the state’s payment system each time they pay you

This process ensures full compliance with the tax regulations in force on the day you receive your income.

Social Security Contributions

Besides income tax, you and your employer must contribute to Serbia’s social security system, which includes pension, health, and unemployment coverage.

Here’s how the rates break down:

Employers calculate and submit both their share and yours each month. You don’t need to take any action — the contributions are automatically deducted from your gross salary.

Tax Relief for Newly Settled Foreign Workers

If you’re new to Serbia, you might qualify for a major tax incentive.

You can reduce both your tax base and your social security contributions by 70%, if you meet one of these conditions:

• You didn’t predominantly live in Serbia during the 24 months before signing your employment contract

• You’re under 40 years old and lived abroad for at least 12 months before employment, for education or training

This relief lasts for five years, starting from the date you sign your employment contract.

To activate this incentive:

• You need to register as a Serbian tax resident

• You must join the Serbian social insurance system

If you meet both conditions and settle in Serbia soon after signing the contract, you’ll unlock this substantial tax benefit.

Summary

Let’s recap the essentials if you’re a foreign employee working in Serbia:

• You pay 10% income tax only on income above 25,000 RSD/month

• Your employer calculates and pays the tax

• Both you and your employer contribute to social security

• You may qualify for a 70% tax and contribution relief if newly settled

Want to check your eligibility or set up your tax profile in Serbia? ✅

📧 Contact us at: [email protected]
📞 Call us directly: +381 11 328 1914
🌐 Visit: www.statt.rs

Self-Employed Foreigners in Serbia: How to Handle Taxes

If you’re a foreign citizen working as a freelancer or entrepreneur in Serbia, you must understand how self-employment income is taxed.

Whether you’ve just opened your business or have been working independently for a while, managing your taxes correctly is key to staying compliant.

Who Qualifies as Self-Employed?

If you register an independent activity in Serbia — commonly as a sole proprietor (preduzetnik) — the Serbian tax system treats you as self-employed.

This means you must:

• Pay income tax

• Contribute to the social security system

Income Tax Rate and Tax Base

You pay 10% income tax on your self-employment income. However, the way your tax base is calculated depends on your setup.

You have two options:

1. Taxable profit basis – You calculate profit by subtracting eligible business expenses from income.

2. Flat-rate taxation – You pay tax based on a fixed income estimate, approved by the Tax Administration, if you meet the legal conditions.

👉 If you choose to pay tax on taxable profit, you must submit tax returns yourself (self-assessment).
👉 If you opt for flat-rate taxation, the Tax Administration sends you a formal tax decision with the amount due.

Social Security Contributions for Entrepreneurs

As a self-employed person, you must also contribute to Serbia’s compulsory social insurance system, which covers:

• Pension and disability insurance

• Health insurance

• Unemployment insurance

Here are the contribution rates:

You must calculate and pay these contributions yourself, typically in monthly advance payments.

Need More Information?

You can find detailed guidance on self-employment taxes on the official Serbian Tax Administration website.

💡 For practical help, download their Tax Information Sheet for Self-Employed Natural Persons [Insert link here if online].

Summary

If you’re a self-employed foreigner in Serbia:

• You pay 10% tax on either profit or flat-rate income

• You choose between self-assessment or flat-rate taxation

• You must pay your own social security contributions

• You should stay updated using the official Tax Administration resources

Need assistance with self-employment registration or tax filings in Serbia? ✅ 

📧 Reach us at: [email protected]
📞 Or call: +381 11 328 1914
🌐 Visit: www.statt.rs

Digital Nomads in Serbia: Do You Owe Local Taxes?

If you’re a digital nomad or work in Serbia for a foreign company, you might wonder if — and how — you should pay taxes here.

This section explains what happens when you’re:

• A foreign national physically present in Serbia

• Working remotely for a foreign employer or client

• Receiving income from abroad, without any local company withholding taxes

Who Needs to Pay?

If you’re a non-resident foreigner working in Serbia and receive income from:

• Foreign legal entities (companies or entrepreneurs)

• Foreign individuals

• Domestic individuals who don’t calculate or pay taxes on your behalf

…then you are personally responsible for calculating and paying both income tax and social security contributions.

What Kind of Income Counts?

This applies if your income comes from:

• Copyrights or related rights

• Freelance work or service agreements

• Any fees paid for work performed on Serbian territory

You must use the self-assessment method to report and pay your taxes.

How and When to Pay

You must:

• Calculate and pay taxes quarterly, based on the income you earned in that period

• Submit a tax return within 30 days after each quarter ends

• Pay the tax within the same 30-day deadline

Two Models for Taxation

You can choose between two tax models each quarter, depending on what works best for you.

Model 1 – Standardized Cost Option

• Fixed deductible costs: 103,296 RSD per quarter

• Income tax rate: 20%

• Pension base: Your taxable income

• Health insurance base: At least 3× 15% of Serbia’s average monthly salary

Model 2 – Mixed Percentage Option

• Deductible costs: 62,300 RSD per quarter plus 34% of your gross income

• Income tax rate: 10%

• Pension base: Same as taxable income

• Health insurance base: Same rule as in Model 1

You can switch between models each quarter — just make sure to calculate, declare, and pay correctly based on your choice.

Special Case: Referred Workers

If a foreign employer sends you to work in Serbia (a “referred person”), the rules may differ.

Typically:

• Your earnings are subject to Serbian tax and contributions

• However, international tax agreements may exempt you, depending on the treaty between Serbia and your home country

Always check if your country has a double taxation agreement with Serbia and how it applies to your case.

Summary

If you’re a digital nomad or a referred worker in Serbia:

• You must handle self-taxation if no local entity pays your tax

• You pay taxes quarterly, with returns due 30 days after each quarter

• You choose between two models for calculating tax and contributions

• If you’re sent by a foreign employer, check international treaties for exemptions

Need help registering, filing tax forms, or choosing the right model? ✅

📧 Contact us at: [email protected]
📞 Call: +381 11 328 1914
🌐 Learn more: www.statt.rs

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