How to Start a Company in Serbia: A Guide for Foreign Investors

Opening a business in Serbia is a straightforward process, attracting foreign investors with its favorable tax policies, low operating costs, and its strategic location between Central and Southeastern Europe. Below is a step-by-step guide to company formation in Serbia:

1. Choosing the Right Business Structure in Serbia

When starting a company in Serbia, investors can choose from several legal entities, including:

• Limited Liability Company (D.O.O.): The most popular choice for small and medium-sized businesses. A D.O.O. requires minimal capital investment (just 100 dinars, less than 1 euro) and offers limited liability protection for shareholders.
• Sole Proprietorship (PR): Perfect for solo entrepreneurs, this structure makes the owner personally liable for the business’s obligations.
• Joint Stock Company (A.D.): Suited for larger companies, this structure requires more capital and allows the issuance of shares.
• General Partnership (O.D.) and Limited Partnership (K.D.): These structures involve multiple partners with varying degrees of liability, depending on the agreement.

                                                                                                                                                  2. Registering Your Company in Serbia

Business registration in Serbia is handled by the Business Registers Agency (APR). You’ll need to submit the following documents:

• Completed application for registration;
• Articles of association (the company’s founding document);
• Proof of capital deposit;
• Proof of a business address in Serbia (a virtual office can be used);
• Appointment of directors and administrators. Once submitted, the APR typically processes and registers the company within five working days.

                                                                                                                                                    3. Getting a Tax Identification Number (PIB)

After registering, your company must obtain a Tax Identification Number (PIB) from the Serbian Tax Authority. This is required for tax filings and business transactions.

4. Opening a Bank Account in Serbia

You will need to open a business bank account at a Serbian bank. The minimum capital deposit must be transferred to this account to initiate company operations.

5. Registering for VAT in Serbia

Businesses with an annual turnover exceeding 8 million dinars (around 68,000 euros) must register for VAT. However, smaller companies can opt for VAT registration voluntarily.

6. Tax and Accounting Compliance

Serbia offers a competitive corporate tax rate of 15%, one of the lowest in Europe. Companies must keep accounting records in line with both Serbian and international accounting standards. We recommend hiring a local accountant to help meet these regulatory requirements.

7. Industry-Specific Licenses and Permits

Some businesses, especially those in construction, hospitality, or retail, may require specific licenses or permits from Serbian authorities. Be sure to check if your business needs any additional approvals.

Incentives for Foreign Investors in Serbia

Serbia offers a wide range of incentives for foreign investors, such as:

• Tax breaks for investments in underdeveloped areas;
• Grants for creating new jobs;
• Access to multiple trade agreements with the European Union, Russia, and other key markets;
• Competitive labor costs compared to other European countries.