Overhead Costs
Extremely competitive environment provides second lowest corporate income tax in Europe, together with other favorable taxes and costs.
Read in more detail about:
Value Added Tax
Corporate Income Tax
Withholding Tax
Personal Income Tax
Annual Income Tax
Social Insurance Contributions
Labor Costs
Utility Fees
The VAT rates are as follows:
- The standard VAT rate - 18% (for most taxable supplies);
- The lower VAT rate - 8% (for basic food stuffs, daily newspapers, utilities etc.).
Corporate profit tax is paid at the uniform rate of 10%. Non-residents are taxed only based on their income generated in Serbia.
Withholding tax is calculated and paid at the rate of 20% on various forms of income (dividends, shares in profits, royalties, interest income, capital gains, lease payments for real estate, and other assets) by a non-resident.
The personal income tax rate is 12% for salaries, while other personal income is predominantly taxed at the rate of 20%.
For non-Serbian citizens, the annual income is taxed if exceeding the amount of 5 times the average annual salary in Serbia. The tax rate is 10% for the annual income below the amount of 8 times the average annual salary, and 15% for the annual income above the amount of 8 times the average annual salary.
SOCIAL INSURANCE CONTRIBUTIONS
The rates for mandatory social security contributions are:
- 11% for pension and disability insurance,
- 6.15% for health insurance, and
- 0.75% for unemployment insurance.
Average salaries in Serbia are low enough to ensure cost-effective operations. While slightly higher than in neighboring countries such as Romania, total costs for employers stand at merely 50% of the level in EU countries from Eastern Europe. Social insurance charges and Salary Tax sum up to roughly 65% of the net salary but the tax burden for employers can be reduced through a variety of financial and tax incentives available.
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ELECTRICITY
The 100% state-owned Electric Power Industry of Serbia is the sole electricity supplier at the moment. The electricity price varies according to the consumption category and daily tariff rate, ranging between €0.0111-0.033 in the high tariff category.
GAS
As a natural gas supplier in Serbia, the state-owned company Srbijagas pursues its pricing policy in accordance with world prices of oil derivatives and the US dollar exchange rate fluctuations. The price of natural gas is set every 15 days, currently standing at €0.3328/m3.
WATER
The waterworks in Serbia are operated at the municipality level with water prices set by local authorities.
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