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Global Payroll Team
Written by Global Payroll Team
Last updated May 1, 2026
Expert Reviewed
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Mercans offers complete payroll, PEO and HR services in Serbia

Serbia remains an attractive destination for foreign direct investment thanks to its strategic location, competitive operating costs, skilled labour force, and broad network of trade agreements. The country continues to support investment through industrial zones, incentives, and free zones, while also offering strong manufacturing, automotive, food processing, machinery, ICT, and services capabilities.

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Doing Business in Serbia

To assist companies in streamlining their operations, many municipalities and industrial zones offer developed infrastructure and business incentives. Serbia continues to position itself as a competitive regional hub for investment and operations. Employers should, however, closely monitor employment, tax, payroll, and immigration compliance requirements, especially following recent changes to the residence and work permit framework.

Entity Registration and Incorporation Requirements

Setting up a new business or expanding an existing one in Serbia is straightforward. Choose how your company operates from a range of entity types that suit your individual circumstance.

Banking

Banking hours vary by institution, with many branches operating Monday to Friday.

Working Week

The standard working week is from Monday to Friday. Under Serbian Labour Law, full-time work is generally 40 hours per week.

Labor Law

Employment in Serbia is primarily governed by the Labour Law, alongside anti-discrimination, health and safety, tax, and social insurance legislation. Bilateral tax and social security treaties may also be relevant for foreign nationals and cross-border workers, depending on their residence and work arrangements.

Main Industries

Motor vehicles, base metals, food processing, machinery, chemicals, information technology, agriculture and logistics

GDP Growth

3.9%

Dates & Numbers

dd/mm/yyyy

Official State Name

Republic of Serbia

Population

6.59 million

Capital

Belgrade

Major Languages

Serbian

Currency

Serbian dinar

Internet Domain

.rs

International Dialing Code

+381

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Serbia
Belgrade, RS
4:51 pm, May 2, 2026
20°C
clear sky
32 %
Wind Gust: 0 mph
Clouds: 0%
Sunrise: 5:26 am
Sunset: 7:43 pm

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Payroll

The minimum wage in Serbia is set by decision and expressed as an hourly amount. From 1 January 2026, the minimum wage amounts to 371 RSD per working hour. There are no general statutory caps on salary levels or universal restrictions on payment methods that apply to all employees.

Electronic payroll records and payslips are commonly used, provided payroll documentation is properly maintained

Payslip

Employees are entitled to receive paid annual leave of at least 20 working days

Annual Leave

Sick leave is paid according to medical certification rules, with the first 30 days generally paid by the employer

Sick Leave

Employees are entitled to 365 days of maternity leave and leave for nursing a child, while paid leave for childbirth-related events is regulated separately

Maternity & Paternity Leave

Where statutory notice applies, it may not be shorter than 8 days nor longer than 30 days

Employee Termination

There are no provisions mandated by law regarding the 13th month salary

13th month salary

371 RSD per hour

Minimum Wage

Overtime work must be paid at a minimum 26% increase over the base salary rate

Overtime

Eligible employees are entitled to at least one third of salary for each full year of service with the employer

Severance Pay

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Tax and Social Security

Residents are generally taxed on their worldwide income, while non-residents are taxed on Serbia-sourced income. Employment income is subject to personal income tax and mandatory social security contributions, with employers acting as withholding agents for payroll-related liabilities.

Tax

Serbia generally applies a 15% corporate income tax rate, a 10% personal income tax rate on salary income, and a standard VAT rate of 20%.

15%

Corporate Income Tax

10%

Personal Income Tax

20%

Sales Tax

20%

VAT

Social Security

Mandatory social security contributions cover pension and disability insurance, health insurance, and unemployment insurance. Contributions are calculated on salary up to the applicable statutory base limits and are withheld and remitted through payroll.

35.05%

Social Security Rate

15.15%

Social Security Rate for Employers

19.90%

Social Security Rate for Employees

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Employment Law

Where an employee is seconded from Serbia to work abroad, separate rules on secondment and worker protection may apply in addition to the Labour Law. Serbian employment law also regulates written contracts, working time, paid leave, dismissal procedures, and employee protections.

Employment Agreement

Every employment relationship must be supported by a written employment contract. Employment may be established for a definite or indefinite period, depending on the legal basis and duration of the role.

Working condition

Full-time working hours are generally 40 hours per week. Overtime is allowed only in specific cases, may not exceed eight hours a week, and total daily working time including overtime may not exceed 12 hours.

Leaves

Employees are entitled to at least 20 working days of annual paid leave per year. This can be increased based on internal rules or contracts. Paid leave is also available for specific personal events, including marriage, childbirth of a spouse, serious illness of an immediate family member, and bereavement.

Employment termination

A Serbian employment agreement may be terminated for reasons related to employee conduct, performance, redundancy, expiry of term, or other lawful grounds. Certain categories of employees benefit from specific statutory protections against dismissal.

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8 to 30 days

Minimum notice period for terminating an employee

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Total number of public holidays

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40

Working hours per week

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5 days

Total number of days for Compassionate & Bereavement Leave

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Immigration

Serbia now operates a single-permit framework for many foreign workers. In order to work in Serbia, foreign nationals generally need either a visa D issued on the basis of employment or a temporary residence and work permit, depending on the circumstances and nationality.

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Residency permits

Foreigners who wish to work in Serbia generally need an appropriate residence and work authorization. Requests for temporary residence and work, including the single permit, can be submitted electronically through the government portal. Permanent residence may generally be requested after three years of continuous residence, subject to legal conditions.

Work Permit Validity

Typically aligned with the validity of the issued single permit or temporary residence and work authorization

Required Documents

A duly completed visa or permit application form

A valid passport

Grounds for residence and work, including employment-related supporting documents

Proof of health insurance, where required

A passport photo, where requested

Evidence of sufficient funds or income for the stay, where required

Proof of accommodation in Serbia, where required

Proof of payment of the applicable government fee.

Compliant, reliable, error-free and touchless payroll in Serbia

Build the best team and hire top talent compliantly in Serbia. Get in touch with Serbia payroll outsourcing & PEO specialists for a free consultation!

This document was prepared for informational purposes only. As local laws & regulations keeps on changing. Please consult your tax & legal advisors as well.
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    FAQs

    What is an Employer of Record (EOR) in Serbia and how does it work for foreign companies?

    Mercans’ Employer of Record solution in Serbia enables international companies to hire Serbian employees legally and quickly. Mercans becomes the official employer of record, handling employment contracts, payroll processing, tax and social security filings, and labour-law compliance. Meanwhile, the foreign company retains operational control of the employee’s work, performance and direction in Serbia.

    Why should businesses use an EOR instead of establishing a legal entity in Serbia?

    Using Mercans as your EOR in Serbia avoids the time‐consuming and costly process of setting up a local subsidiary. You can access the Serbian labour market immediately, benefit from local payroll and compliance infrastructure, reduce administrative burden and ensure compliance with Serbian tax, social security and employment laws, without the overhead of entity formation.

    How does payroll outsourcing in Serbia ensure compliance with tax and labour regulations?

    Mercans’ payroll outsourcing services in Serbia manage all statutory obligations, including salary disbursal, income tax withholding, social security contributions, employment contract compliance and regulatory filings. The Mercans team keeps abreast of Serbian labour law and tax updates to ensure you stay risk-free, with accurate payroll and compliant workforce management.

    Can an Employer of Record in Serbia hire employees and manage work permits for international companies?

    Yes. Mercans can hire employees in Serbia on behalf of your international company, both local Serbian talent and eligible foreign nationals. Mercans handles work permit and visa arrangements for foreign employees where required, together with registrations, filings and compliance with Serbian immigration and labour regulations.

    What are the main benefits of using EOR and payroll services in Serbia for global expansion?

    The key benefits of partnering with Mercans for EOR and payroll in Serbia include fast market entry into Serbia and flexible workforce scaling, avoiding entity setup costs and local administrative overhead, full compliance with Serbian labour law, tax and social security regulations, reduced risk of fines or non-compliance through expert local oversight, access to local HR and payroll expertise from Mercans for a seamless hiring experience, and simplified global workforce management via a trusted EOR provider.

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