Working in Serbia offers many opportunities for foreigners — affordable living, friendly locals, and a growing job market. However, understanding Serbia’s tax system is crucial before you start working there. This guide explains the types of taxes, rates, and obligations that foreign workers need to know in 2025.

Who Pays Taxes in Serbia?

In Serbia, anyone earning income from employment — whether local or foreign — must pay taxes. However, the rules differ depending on your residency status.

• Tax Residents: Individuals who live in Serbia for 183 days or more in a 12-month period are considered tax residents. They are taxed on their worldwide income (income earned both in and outside Serbia).

• Non-Residents: Those who stay in Serbia for less than 183 days are taxed only on income earned within Serbia(such as salaries from Serbian employers).

Income Tax Rates in Serbia

Serbia has a flat income tax system, meaning everyone pays the same percentage regardless of income level.

• Personal Income Tax Rate: 10% on salaries and wages.

• Self-Employment Tax: Usually 10% to 15%, depending on the type of activity and deductions allowed.

• Freelancers / Remote Workers: Often taxed under the same rate (10%), but additional contributions may apply based on earnings and structure (company, sole proprietor, etc.).

Employers typically withhold the tax at source, so employees receive a net salary after tax deductions.

Social Security Contributions

In addition to income tax, foreign and local employees must contribute to Serbia’s social security system. These contributions cover health insurance, pensions, and unemployment benefits.

The total contribution rate is approximately 37.8%, divided between the employer and employee as follows:

• Pension and Disability Insurance: 25.5% (14% paid by employer, 11.5% by employee)

• Health Insurance: 10.3% (5.15% each by employer and employee)

• Unemployment Insurance: 2% (0.75% by employer, 1.25% by employee)

While these rates can seem high, they ensure access to Serbia’s healthcare and pension systems.

Double Taxation Treaties

Serbia has double taxation agreements (DTAs) with over 60 countries, including India, the United States, the United Kingdom, Germany, and France.

These treaties prevent workers from paying taxes twice on the same income — once in Serbia and again in their home country. If your country has a DTA with Serbia, you can usually claim tax relief or exemption by providing a tax residency certificate from your home country.

Tax Filing and Deadlines

• Employer Responsibilities: Most employers in Serbia handle tax deductions automatically each month.

• Employee Obligations: If you earn additional income (like freelance work or rent), you must file an annual tax return.

• Filing Deadline: The annual income tax return is generally due by May 15 of the following year.

Foreign workers are encouraged to consult a local tax advisor or accountant to ensure compliance with Serbian tax laws.

Example of Take-Home Pay

If a foreign worker earns €1,500 per month in Serbia:

• 10% income tax = €150

• Social security (approx. 19.9% employee share) = €298.5

• Net take-home pay: roughly €1,051.5 per month (after tax and contributions).

Benefits of Paying Taxes in Serbia

• Access to public healthcare and social security benefits

• Eligibility for pension contributions

• Legal compliance for visa and work permit renewals

• Potential use of tax treaties to reduce total liability