When you're starting a company in Serbia as a foreigner there are few things you will need to know before beginning your business venture.
Procedure for Opening a Business
Business Registers Agency is a government institution in charge of deciding whether conditions for registration of new company and business are met. All the documents regarding incorporation are to be submitted to the Agency, who is organized as One-Stop-Shop System for registration. Although this is truly a simple solution, there are certain steps that you will need to undertake before going to the Agency.
Those steps are: deciding whether you will register your business as a company, for example, Limited Liability Company, or as Sole Proprietor, afterward you will need to choose a business name which must contain the business name, legal form, and place where the head office of the company is located or name and surname of the Sole Proprietor, the label “the label “preduzetnik” or “pr” (in Serbian) and the place where the Sole Proprietor is situated. Since the location of the business is part of a business name, you need to register address of the company, as well as predominant business activity. If you decide to incorporate a business as one of four known forms, you will need to draft Memorandum of Association, pay prescribed share capital and prepare Registration Forms. The final step is to open a bank account and choose an accountant if one is needed.
Costs of Opening a Business
Depending on the form cost of incorporating varies from one form to another. For Limited Liability Company, for example, cost will be around 100,00 EUR for state fees, translation of necessary documents and notarization of the signatures on Memorandum of Association. To hire someone to draft Memorandum and to undertake all other relevant action will cost you around 400,00 EUR. In case you need a virtual address, you will need to pay 50,00 EUR per month, but discounts are possible if you want to pay one year in advance. If you decide to incorporate Limited Liability Company or Joint-stock Company will have to pay prescribed share capital. where for LLC minimum is 1,00 EUR and for JSC minimum is approximately 26.000,00 EUR. Finally, you will need to hire an accountant where average cost is 200,00 EUR per month, but this price may change depending on the business activity you register.
Tax Rates in Serbia
There are three essential tax rates that you need to take into consideration when thinking about opening a business in Serbia. First is Corporate Tax which is at this point only 15% and is accounted on yearly bases. The second one is Income Tax, and it refers to employees salary. This Taxis rated at 52% and paying is shared between employer and employee (capital gains tax 15%, standard income tax rate 10%, additional contributions by employee: 13% state pension fund, 6.5% state health fund, 0.5% unemployment fund; additional contributions by employer: 11% state pension fund, 6.5% state health fund, 0.5% unemployment; maximum contributions capped (amount changing monthly); additional tax for higher salaries (after 3 times average salary additional 10%, after 6 times average salary additional 15%). In the end, the Value Added Tax rate is 20%
To help you prepare documents and successfully finish the whole procedure you can find specialized companies like AsstOffice that can help you.