TAX · EXPATS AND RETIREES · UPDATED OCTOBER 2026
Taxes in Serbia for expats (2026): income tax rates, tax residency, foreign income, pensions, property — and how retirees are taxed
Serbian law taxes income at flat rates by type: 10% on salaries, 15% on dividends, interest, capital gains and company profits, and 20% on rental income (PwC Worldwide Tax Summaries, reviewed 7 August 2026). An annual income tax of 10–15% applies only once total yearly income passes three times the average annual salary — 5,439,096 dinars for 2025 income (KPMG Serbia, February 2026). The law makes a person tax resident if their home or centre of business and life interests is in Serbia, or if they stay 183 or more days in a 12-month period; residents are taxed on worldwide income. There is no income-tax treaty with the United States. Pensions paid under compulsory pension insurance are exempt under Article 9 of the Law on Personal Income Tax. There is no wealth tax and no exit tax. How any of this applies to you is decided case by case — that is what our tax advisory and accounting services are for.
This guide is general information, not tax advice. Your situation is decided case by case — contact us or your home-country adviser.
Most people asking "what are taxes like in Serbia?" get the same three numbers back — 10%, 15%, 20% — and none of the questions that actually decide their bill: whether they are a Serbian tax resident at all, how their foreign salary, dividends, rent or pension is treated once they are, what their home country still taxes, and which filings a resident owes that no employer does for them. This guide, checked against the Law on Personal Income Tax, the Law on Corporate Income Tax and PwC's August 2026 Serbian tax summaries, explains the whole picture for expats, remote workers, business owners and retirees. It describes what the rules are and where they bite; the planning, filings and dealings with the Tax Administration are what our international tax advisory and accounting and tax service do.
Are you a Serbian tax resident? The test that decides everything
Under Article 7 of the Law on Personal Income Tax you are a Serbian tax resident if your domicile or the centre of your business and life interests is in Serbia, or if you are present in Serbia for 183 or more days, continuously or with breaks, in any 12-month period that begins or ends in the tax year. Either test is enough on its own. Which one applies to you, and from what date, is decided case by case. Residents are taxed on worldwide income. Non-residents are taxed only on income from Serbian sources, such as a Serbian salary, a Serbian company's dividends or rent from a Serbian apartment.
Two refinements matter in practice. If you are also resident in a country that has a double taxation treaty with Serbia, the treaty's tie-breaker rules (permanent home, centre of vital interests, habitual abode, nationality) decide which country treats you as resident. And residence is not the same as a residence permit: holding a Serbian permit does not by itself make you a tax resident, and not holding one does not stop you becoming one. Our guides to the permanent residence and the relocation sequence explain where tax residence sits in the timeline. Your own position is decided case by case.
Serbia income tax rates in 2026: what each type of income pays
Serbia has no single progressive income tax scale. Each category of income is taxed separately at its own flat rate, with an annual top-up tax for high earners (next section). The table gives the rates as published for 2026 (PwC Worldwide Tax Summaries, reviewed 7 August 2026; Law on Personal Income Tax). How they apply to you is decided case by case.
| Income | Rate | What to know |
|---|---|---|
| Salary (employment) | 10% | On gross salary above the non-taxable amount of 34,221 RSD a month; employee social contributions of 19.9% and employer contributions of 15.15% come on top |
| Self-employment (entrepreneur, sole trader) | 10% | On actual profit; the flat-rate (paušal) regime is available up to 6 million RSD of turnover |
| Freelance income paid from abroad | 10% or 20% | Two self-assessment models with fixed quarterly cost allowances (2026: 20% after a 103,296 RSD quarterly allowance, or 10% after 62,300 RSD plus 34% of income), filed quarterly |
| Dividends and interest | 15% | Interest on dinar savings and government bonds is exempt |
| Capital gains (property, shares, crypto) | 15% | Exempt if the asset was held for more than ten years; crypto has its own rules (see our crypto tax guide) |
| Rental income | 20% | After a standard cost deduction set in law |
| Royalties and other income | 20% | After standard cost deductions (34–50% for royalties, 20% for most other income) |
| Pensions from a compulsory state scheme | Exempt | Article 9 of the PIT Law; see the retiree section below |
| Annual income tax (top-up) | 10% / 15% | Only on total annual income above three times the average annual salary; 15% above six times |
Company profits are taxed at 15% corporate income tax, and profit paid out to an owner is taxed again at 15% as a dividend. Value added tax is 20% (10% on basic food, medicines, utilities and some other supplies), with compulsory registration once turnover passes 8 million dinars in a rolling twelve months. Our salaries guide shows what the 10% rate and contributions do to a real pay slip, and the digital-nomad guide compares the freelancer models with a company for remote workers.
The annual income tax most expats do not know exists
On top of the flat rates, Serbia levies an annual personal income tax (godišnji porez na dohodak građana) on residents whose total income for the calendar year — salary, self-employment, rent, royalties and most other income, but not dividends, interest or capital gains — exceeds three times the average annual salary. For 2025 income the threshold was 5,439,096 dinars (KPMG Serbia, February 2026). Income above the threshold is taxed at 10% up to six times the average salary (10,878,192 dinars for 2025) and 15% beyond that, after personal deductions of 40% of the average annual salary for the taxpayer and 15% per dependant (capped at half the taxable amount), with an extra deduction of three average salaries for taxpayers under 40. The return is filed by self-assessment by 15 May of the following year, and the tax is paid at the same time. Nothing is withheld for this tax during the year. Whether it applies to you is decided case by case.
Foreign income: what a resident must declare, and how double taxation is avoided
Once you are resident, income you receive from abroad is Serbian-taxable in the year you receive it. Where the payer is foreign and no Serbian tax is withheld — a foreign employer paying a remote worker, a foreign client paying a freelancer, foreign dividends, interest or rent — the resident must self-assess: calculate the tax (and, for employment and self-employment income, the contributions), file a return and pay, generally within 30 days of receiving the income, or quarterly under the freelancer models. Serbia grants a foreign tax credit for income tax paid abroad on the same income, capped at the Serbian tax that would be due on it, and where a treaty exists the treaty's relief method applies instead.
PwC's August 2026 table lists 68 double taxation treaties, covering every EU member state, the United Kingdom, Switzerland, Norway, Canada, Turkey, the Gulf states, China, India, Russia and most of Serbia's neighbours. The treaties decide which country may tax salaries, business profits, dividends, interest, royalties, pensions and property income, and usually reduce Serbian withholding on dividends and interest paid to residents of the other state. There is no income-tax treaty with the United States. US citizens keep filing in the US wherever they live; we work alongside your US adviser — see our US tax guide. PwC's table lists no treaty with Australia or New Zealand either. How your home country treats you is a question for your home-country adviser.
The filing gap. Serbian employers withhold everything for their staff, so employees never file. Expats with foreign income have the opposite problem: nobody withholds, nobody reminds them, and the obligation to self-assess within 30 days, file quarterly under a freelancer model, or file the annual income tax by 15 May sits entirely with them. Late filings attract interest and penalties. Our accounting and tax service runs these filings for expats who do not want to track Serbian deadlines themselves. Relocation Serbia has offices in Belgrade and Novi Sad, so you can go through your income documents with us in person (by appointment) or by video call.
How retirees are taxed in Serbia
Article 9 of the Law on Personal Income Tax exempts pensions and disability benefits paid under compulsory pension and disability insurance from income tax. Whether a pension paid from another country's scheme counts as exempt is decided case by case. Private, occupational and personal pension payments do not automatically fall under the exemption, so the source of each pension has to be classified. Where a tax treaty applies, it decides which country may tax the pension; what your home country does is a question for your home-country adviser. A retiree with several kinds of income — a pension, dividends, rent from a flat back home — can have a different Serbian treatment for each, and the annual income tax above the threshold.
Other Serbian taxes a retiree may meet: annual property tax on a Serbian home, set by each municipality (see the table below). There is no wealth tax. Source of funds for money brought into Serbia is a banking question (see sending money to Serbia). Our retiring in Serbia guide covers the residence route and the cost of living. Your own tax position depends on the treaty and on how each pension is paid, so it is decided case by case.
Not sure which route fits you?
Take the free two-minute Route Finder. It asks about your nationality, how you earn — salary, business, pension, investments or rent — and where your income is paid, and shows which residence route realistically fits. Tax questions are decided case by case after that.
Business owners, remote workers and freelancers
For anyone earning through work, Serbian law offers several set-ups. A Serbian company pays 15% corporate tax and its owner 15% on dividends; a director's salary is taxed at 10% plus contributions; and a company gives founders a residence basis and a clean audit trail for banks and residence renewals (see company formation). An entrepreneur registration under the flat-rate regime pays a fixed monthly amount that covers tax and contributions — but the flat-rate regime is capped at 6 million dinars of turnover and excludes some activities, and an entrepreneur who works mainly for one foreign client can fail the independence test and be re-characterised. The freelancer models are for people paid from abroad without a Serbian entity; they mean quarterly filings. Which set-up fits you is decided case by case. Employees of a foreign company that has no Serbian entity are usually hired through an employer of record, which puts them on a normal Serbian payroll.
Incentives exist, each with its own conditions. The ten-year corporate tax holiday for large investors is being abolished from 1 January 2028 (grandfathered only for conditions met by the end of 2027), the start-up investment credit has been repealed, and the salary tax reliefs for newly settled and newly hired staff, R&D staff and founders each have precise conditions — our incentives guide lists them with the legal basis. Whether any incentive applies to you is decided case by case.
Property, inheritance and the other taxes you will meet
| Tax | Rate | Who pays and when |
|---|---|---|
| Property transfer tax | 2.5% | On purchases of existing property (new-builds carry 10% VAT instead); the seller is the statutory payer, but contracts routinely shift it to the buyer |
| Annual property tax | Progressive, from 0.4% up to 2% for individuals; up to 0.4% for companies | Set by each municipality on an assessed value with deductions for an owner-occupied home; paid quarterly |
| Rental income | 20% after a standard cost deduction | Self-assessed by individual landlords; short-term lets have a separate lump-sum regime (see renting out property) |
| Capital gains on a sale | 15% | On the gain; exempt after ten years of ownership, and relief if the proceeds fund a new home for the seller's family |
| Inheritance and gift tax | 0%, 1.5% or 2.5% | Spouses, children and parents are exempt; second-order relatives 1.5%; everyone else 2.5% |
| Wealth tax, exit tax | None | Serbia has neither |
| VAT | 20% / 10% | Consumers simply pay it; businesses register above 8 million RSD turnover |
Two property points are worth stating plainly. Buying a Serbian home does not by itself create tax residence (see our property guide). For a resident, rent from property abroad is part of worldwide income; how a treaty applies to it is decided case by case.
Common tax mistakes expats make in Serbia
- Counting only days. The law has two residence tests, not one, and a treaty can decide between two countries.
- Assuming an employer or bank handles it. Foreign income is self-assessed; nothing is withheld and nobody sends a reminder.
- Missing the annual income tax. The annual return is due by 15 May of the next year for those above the threshold.
- Treating every pension the same. Compulsory-insurance pensions are exempt under Article 9; private and occupational pensions may not be.
- Leaving the old residence open. Two countries can both see you as resident; how your old country treats your exit is a question for your home-country adviser.
- Choosing the entity from a forum. Company, entrepreneur, flat-rate or freelancer model — which fits you is decided case by case.
Your Serbian tax position, handled case by case.
Our accounting and tax service handles residency assessment, the foreign-income and annual filings, entrepreneur and company bookkeeping and VAT; our international tax advisory handles the Serbian side of cross-border questions and works alongside your home-country adviser.
Frequently asked questions
What is the income tax rate in Serbia?
Flat rates by type of income, as published for 2026: 10% on salaries, 15% on dividends, interest and capital gains, 20% on rental and most other income, and 15% corporate income tax. An annual income tax of 10% (15% at the top) applies only to residents whose total yearly income exceeds three times the average annual salary — 5,439,096 dinars for 2025 income. How they apply to you is decided case by case.
When do I become a tax resident of Serbia?
Under Article 7 of the Law on Personal Income Tax: when your domicile or the centre of your business and life interests is in Serbia, or when you spend 183 or more days here, continuously or with breaks, in any 12-month period. If you are also resident in a treaty country, the treaty's tie-breaker rules decide. Residents are taxed on worldwide income; non-residents only on Serbian-source income. Whether and when that is true for you is decided case by case.
Does Serbia tax foreign income?
Yes, for residents. Foreign salary, freelance income, dividends, interest and rent are taxable in Serbia and, where nothing was withheld, must be self-assessed — generally within 30 days of receipt or quarterly under the freelancer models. Tax paid abroad is credited up to the Serbian tax on the same income, and a double taxation treaty, where one exists, takes priority.
Are pensions taxed in Serbia?
Pensions paid under compulsory pension insurance are exempt from Serbian income tax under Article 9 of the PIT Law. Whether a foreign pension qualifies is decided case by case. Private, occupational and personal pension payments do not automatically qualify and may be taxed as other income. What your home country taxes is a question for your home-country adviser.
Does Serbia have a tax treaty with the United States?
No. There is no US–Serbia income-tax treaty. US citizens keep filing in the US wherever they live; we work alongside your US adviser. PwC's August 2026 table lists 68 Serbian treaties, including every EU state, the UK, Canada, Switzerland and China; it lists none with Australia or New Zealand.
How are freelancers and remote workers taxed in Serbia?
Through one of three set-ups: a Serbian company (15% corporate tax plus 15% on dividends, 10% on a salary), an entrepreneur registration (10% on profit, or a fixed flat-rate amount up to 6 million dinars of turnover), or the freelancer self-assessment models for income paid from abroad (20% after a fixed quarterly allowance, or 10% after a smaller allowance plus 34% of income), filed quarterly. Which one fits you is decided case by case.
Is there a wealth tax, inheritance tax or exit tax in Serbia?
No wealth tax and no exit tax. Inheritance and gift tax is 0% between spouses, children and parents, 1.5% for second-order relatives and 2.5% for everyone else. Property carries an annual property tax (progressive up to 2% for individuals) and a 2.5% transfer tax on purchases of existing property.
Is Serbia a low-tax country for expats?
Serbia uses flat rates (10–20% by type of income), exempts pensions paid under compulsory insurance, and has no wealth or exit tax. Whether your total tax is lower than at home depends on your income, your home country's rules and any treaty, so it is decided case by case.
Written by the Relocation Serbia team. Last reviewed: 17 October 2026. This guide is general information, not tax advice. Your situation is decided case by case — contact us or your home-country adviser. Rates, thresholds and treaty positions change. Sources: Law on Personal Income Tax (consolidated text with 2026 amendments), Articles 7–9, 12, 16, 38 and 87; Law on Corporate Income Tax as amended by Official Gazette 80/2026; Law on Value Added Tax; Law on Property Taxes; PwC Worldwide Tax Summaries — Serbia, individual and corporate (last reviewed 7 August 2026), including the 68-treaty withholding table; Tax Administration of the Republic of Serbia (English text of the PIT Law, November 2025); Welcome to Serbia portal, income taxes (freelancer models and 2026 allowances); annual income tax thresholds for 2025 income (5,439,096 / 10,878,192 RSD; deductions 725,213 / 271,955 RSD; KPMG Serbia tax alert, February 2026).