Accounting and Bookkeeping in Serbia: What Every Foreigner Must Know Before Opening a Business

Moving to Serbia and starting a company can be an excellent strategic decision. Whether your goal is Serbian residency, agricultural land acquisition, or expanding operations into Southeast Europe, Serbia offers attractive corporate structures and tax advantages.

However, one of the most misunderstood aspects of running a business in Serbia—particularly among foreign founders—is accounting and bookkeeping compliance.

Many new business owners ask:

• “I just opened my company. I have zero revenue. Why do I need bookkeeping?”

• “If I’m not making money yet, what is there to report?”

• “Can I handle this myself like I did in my home country?”

The short answer: Serbian corporate compliance begins on day one — regardless of turnover.

This guide explains what expats and foreign investors need to understand about accounting, bookkeeping, VAT obligations, and corporate compliance in Serbia.

Under Serbian law, accounting and financial reporting are governed by:

• The Accounting Law

• Corporate Tax Law

• VAT Law

• Tax Administrative Procedures

Every registered business must maintain accounting records from the moment it is incorporated.

This applies even if:

• You have zero revenue

• You have no employees

• You own no property

• Your business has not yet started operating

The obligation is not based on activity — it is based on registration.

Once your company is established, financial reporting begins.

When expats move to Serbia and open a business, they typically choose between:

• DOO (Društvo sa Ograničenom Odgovornošću) – equivalent to an LLC

• Entrepreneur (Preduzetnik)

Understanding the accounting differences between these two is critical.

If you open a DOO, full bookkeeping and accounting are mandatory from day one.

This includes:

• Recording capital contributions

• Monthly bookkeeping

• Annual financial statements

• Corporate tax reporting

• Potential VAT reporting

Even if you deposit only initial share capital and have no additional transactions, that capital injection itself must be recorded.

Serbia technically allows a DOO to be formed with as little as €1 in share capital. However, in practice, foreign investors typically deposit €100–€500 to demonstrate operational credibility.

That deposit is your first transaction — and it must be recorded.

This structure has a variation.

If you operate under the flat-rate (paušal) taxation system and your annual revenue does not exceed 8 million RSD, you are not legally required to maintain full double-entry bookkeeping.

However:

• You must still issue proper invoices.

• You must maintain financial records.

• You are fully personally liable.

• You cannot deduct expenses in the same way as a DOO.

• You must still pay flat-rate monthly taxes — even with zero income.

Once revenue exceeds 8 million RSD annually, you are required to move into full bookkeeping compliance.

It is also important to note:

You can transition from Entrepreneur to DOO —
You cannot convert a DOO into an Entrepreneur structure.

VAT (PDV in Serbia) is another area of frequent confusion for expats in Serbia.

VAT registration becomes mandatory if:

• Your annual turnover exceeds 8 million RSD

• You voluntarily opt into the VAT system

• You operate certain regulated activities (e.g., hospitality)

Serbia’s standard VAT rate is 20%.

Important clarification:

The 8 million RSD threshold applies to total turnover — not profit.

If 8 million RSD enters your bank account, you have crossed the threshold, regardless of expenses.

Once in the VAT system, you must report:

• Input VAT (VAT you paid)

• Output VAT (VAT you charged)

• VAT liabilities

• VAT refund claims (if applicable)

VAT reporting is periodic and highly regulated. Errors can result in penalties or audits.

New founders often say:

“We had no activity. What could possibly need to be filed?”

Here is what typically exists, even in a dormant company:

• Bank account transactions

• Capital deposit

• Accounting service invoices

• Government fee payments

• Currency conversion differences

• Foreign exchange reporting

• Zero tax declarations

Serbian authorities expect regular filings — even when reporting zero activity.

Failure to submit required reports can result in fines or compliance flags.

Serbia applies a 15% corporate income tax rate on profits for DOO structures.

If your company is VAT registered, VAT is handled separately from corporate tax.

Corporate tax reporting includes:

• Balance sheets

• Income statements

• Statistical reports

• Annual filings with the Serbian Business Registry (APR)

• Tax authority submissions

All filings must reconcile correctly.

Discrepancies between bank records and accounting records may trigger inspections.

Foreign founders frequently operate in:

• EUR

• USD

• CAD

• GBP

Serbian businesses may hold multi-currency accounts. However, for reporting purposes, all transactions must be converted into Serbian dinars (RSD) using official exchange rates.

This introduces:

• Forex gain/loss calculations

• Currency reconciliation requirements

• Additional compliance complexity

If you work with foreign clients, international payment processors, or cross-border contracts, compliance obligations increase.

If your company has employees — including yourself — additional obligations apply.

This includes:

• Salary calculations

• Payroll tax filings

• Social contribution payments

• Payslips

• Annual payroll summaries

As a company director, you may:

• Serve as unpaid director

• Be employed by your own company

• Receive salary or director compensation

Each structure has compliance implications.

Serbian tax authorities have broad enforcement powers.

They can:

• Conduct audits

• Request documentation

• Freeze bank accounts

• Impose fines

• Review up to five years of records retroactively

We have seen cases where founders attempted to manage compliance independently and misfiled documentation. In some instances, accounts were frozen until accounting corrections were completed.

For a foreigner unfamiliar with Serbian tax codes and procedures, resolving such issues can be complex and stressful.

Foreign individuals cannot directly purchase agricultural land in Serbia.

However, Serbian corporations can.

Many foreign investors open a DOO specifically to:

• Acquire orchards

• Purchase farmland

• Invest in agricultural production

This is entirely legal — but requires proper corporate compliance.

If your company holds property, accounting obligations increase accordingly.

Even experienced entrepreneurs often assume:

“I managed my books back home. I can manage them here.”

Serbia operates under:

• Different accounting classifications

• Different reporting cycles

• Different tax codes

• Different compliance expectations

Failure to adapt to local regulations can create significant operational disruptions.

Opening a business in Serbia is straightforward. Remaining compliant is where expertise matters.

From day one, every company has:

• Reporting obligations

• Financial records

• Filing deadlines

• Tax compliance requirements

Even if your turnover is zero.

For expats in Serbia, investors, and entrepreneurs using business structures for residency or property acquisition, accounting is not a secondary detail — it is a legal foundation.

If you are planning to move to Serbia, open a company, or restructure your existing business, we strongly recommend professional guidance tailored to your case.

At Relocation Serbia, we provide full-service business setup, accounting, bookkeeping, tax compliance, and corporate advisory services — ensuring your company remains compliant from day one.

Book a paid consultation with our team to understand your exact obligations and structure your Serbian business correctly from the start.

Your Move, Our Mission.