Serbia is a small, landlocked country between Central and Southeastern Europe. With a similar culture to other countries in Western Europe and a pending application to join the EU, Serbia is a great country to choose for your expansion. During the process, you’ll need to navigate Serbia payroll options, set up a payroll, and ensure compliance.
G-P will make the process easier with Serbia payroll outsourcing. As a global PEO, we use our existing subsidiary to run your compliant payroll, hire employees that work on your behalf, and make your expansion painless and easy.
Taxation Rules in Serbia
Serbia’s social security program includes pension and disability, health insurance, and unemployment insurance. Employees and employers contribute to all three areas at varying rates:
- Pension and disability: Employees contribute 14%, and employers contribute 11.5%
- Health insurance: Employers and employees contribute 5.15%
- Unemployment insurance: Employees contribute 0.75%
As an employer, you have to withhold all employees’ income tax as part of your Serbia payroll. All employees get taxed 10% (Income tax) whether they are foreigners or local nationals. Income tax it is calculated as per the formula: (Gross salary – 21712 RSD)*10%. In regards to Social and Health Contributions for Employees and Employers, there is a threshold for individuals making up to 500,360 RSD.
Serbia Payroll Options for Companies
Before you set up your Serbia payroll, you need to decide which option is best for your company. The four main Serbia payroll options include:
- Internal: Larger companies looking to operate in Serbia for years to come may want to establish their own internal payroll. This option will require hiring a larger staff, though, so you can run your payroll.
- Remote: Remote payroll works well for big parent companies who want their subsidiary to operate under the same payroll. However, you need to ensure you follow the correct regulations for each company.
- Serbia payroll processing company: A Serbia payroll processing company will take care of outsourcing your payroll, but you will still be held responsible for all payroll regulations and employment compliance laws.
- Serbia payroll outsourcing: Finally, you can outsource your Serbia payroll with G-P. We use our Employer of Record platform to handle your payroll and take on the responsibility of compliance.
How to Set Up a Payroll in Serbia
The most important thing you need to set up your Serbia payroll is a compliant subsidiary. Establishing a subsidiary in Serbia allows you to operate legally in the country, and you can start hiring employees and adding them to a Serbia payroll option. However, establishing a subsidiary can take weeks or months and leave you without an option in the meantime.
G-P can assist with our Serbia payroll outsourcing services. We’ll help you navigate complex employment compliance laws, and get your Serbia payroll set up faster.
Entitlement/Termination Terms
We recommend outlining entitlement and termination terms in an employment contract before you hire employees and set up your payroll since termination can be tricky in Serbia. You should include the exact duration of notice in a contract and give the employee a warning before terminating them for violating work duty or discipline.
Payroll Processing Company in Serbia
Contact us today to learn more about our Serbia payroll outsourcing services and how we can help with your expansion.