Serbia attracted €4.5 billion in foreign direct investment in 2024, a 12% increase year-on-year according to the National Bank of Serbia. That figure sounds encouraging. Behind it, however, lies an uncomfortable truth: every year, a portion of those investors begin company formation in Serbia without understanding what each decision legally entails, and pay for it later.
Founders who paid the registration fee but missed the first tax filing within 15 days received automatic penalties. Foreign investors who chose an LLC over sole entrepreneurship because it "sounded more serious" overpaid taxes for years. Or the opposite happened.
This guide covers the full process from start to finish: which legal form to choose, exactly how much BRA registration costs, what the step-by-step process looks like, what cannot be skipped, and which tax incentives are available. No generalisations. If you are still weighing whether Serbia is the right jurisdiction, our overview of investment in Serbia covers the legal and tax case.
Contents
- Who Can Form a Company in Serbia?
- Types of Business Entities
- Comparison: Entrepreneur, LLC, Branch, Representative Office
- Company Formation in Serbia: Step by Step (7 Steps)
- Costs of Company Formation 2026: BRA Fee Table
- Company Formation in Serbia for Foreign Nationals
- Online Company Formation in Serbia
- Opening a Corporate Bank Account
- Post-Incorporation Obligations: Tax, Accounting, VAT
- Tax Incentives for Foreign Founders and Innovative Startups
- Most Common Mistakes When Forming a Company
- Frequently Asked Questions
Who Can Form a Company in Serbia?
Any natural or legal person, regardless of citizenship or country of origin, can initiate company formation in Serbia. There are no special conditions or restrictions for foreign founders, except those that apply to specific regulated sectors such as finance, healthcare, and energy (for example, opening a pharmacy in Serbia requires a Ministry of Health permit in addition to BRA registration).
The founder and the director of the company can be the same person or different persons, domestic or foreign. Among foreign clients of Zunic Law, the most common situation is one where the founder is a foreign national living outside Serbia and the director is the same or another person, as required.
One point that many founders overlook: the act of forming a company does not itself require a residence permit. However, as soon as a foreign national establishes an employment relationship within that company or takes on the role of a director who actively works in Serbia, a unified permit is required in most cases. More detail is available in our blog on temporary residence in Serbia by company formation.
Types of Business Entities
The Companies Act of Serbia (whose key 2024 amendments are analysed in our company law Serbia guide) recognises four forms of business entities: general partnership (OD), limited partnership (KD), limited liability company (LLC / d.o.o.), and joint-stock company (AD). In addition, entrepreneurship is a distinct form of conducting business activity that is not a company in the legal sense, yet it is the most common form by number of registered entities in Serbia.
For the vast majority of new founders, the relevant choice is between entrepreneurship and an LLC. The other forms have specific applications.
Sole Entrepreneur
A sole entrepreneur is a natural person who conducts business activity for profit. There is no minimum share capital requirement. Registration is the fastest and least expensive option. The key distinction from an LLC: the entrepreneur bears unlimited personal liability for all business obligations with their entire personal estate.
A helpful analogy: a sole entrepreneur is like a driver operating their own vehicle without third-party liability insurance. If damage occurs, it is paid from their own pocket. An LLC is like a driver operating a company car with full insurance. Personal financial exposure is limited.
Entrepreneurs carry a significantly lower tax burden and fewer administrative obligations. For freelancers, consultants, developers, and service businesses with relatively low commercial risk, this is often the optimal choice. Registration details are covered in our blog on electronic registration of entrepreneurs in Serbia.
Limited Liability Company (LLC)
When it comes to company formation in Serbia, the LLC is by far the most common legal form. BRA registration of an LLC takes between 3 and 5 business days from submission of complete documentation. A member's liability is limited to the amount of their capital contribution. The minimum share capital is 100 RSD, which is a symbolic amount. For founders intending to apply for a temporary residence permit based on their company position, a minimum capital of 250 EUR is recommended.
An LLC may have one or more members. Management is organised through a director, supervisory board, or board of directors.
One point that is often overlooked: the limited liability rule is not absolute. If a member has abused the limited liability rules in a manner provided by the Companies Act (so-called piercing the corporate veil), a creditor may pursue that member's personal liability. This regularly occurs in practice, particularly in cases involving commingling of business and personal finances.
Joint-Stock Company (AD)
An AD is appropriate for larger companies, stock exchange listing, and attracting institutional investors. The minimum share capital for a closed AD is 3,000,000 RSD (approximately 25,500 EUR). For startups and SMEs, this is generally not a relevant form.
Branch Office and Representative Office of Foreign Companies
A foreign company wishing to establish a presence in Serbia can, instead of forming a separate LLC, register a branch office or a representative office. A branch office is not a separate legal entity but an extension of the foreign parent company, which remains liable for the branch's obligations. A representative office may only conduct research, promotional, and marketing activities, not commercial activity. More details are available in our blog on establishing a branch office and representative office.
Comparison: Entrepreneur, LLC, Branch Office, Representative Office
| Characteristic | Entrepreneur | LLC | Branch Office | Representative Office |
|---|---|---|---|---|
| Minimum capital | None | 100 RSD (<1 EUR) | None | None |
| Liability | Unlimited (personal) | Limited to capital contribution | Parent company is liable | Not a commercial entity |
| Commercial activity | Yes | Yes | Yes | No |
| Can employ staff | Yes | Yes | Yes | Yes (limited) |
| Tax on income/profit | 10–20% lump-sum or actual income | 15% corporate income tax | 15% corporate income tax | N/A |
| BRA fees 2026 | 2,900 RSD online | 5,900 RSD online / 6,500 RSD classic | ~7,000 RSD | ~7,000 RSD |
| Time to incorporate | 3–5 business days | 10–15 business days | 10–15 business days | 10–15 business days |
| Best suited for | Freelancers, consultants, low-risk services | SMEs, startups, foreign investors | Foreign companies with a local subsidiary | Marketing and research |
Company Formation in Serbia: Step by Step (7 Steps)
Step 1: Choose the Legal Form and Ownership Structure
Define who the founders are, who will serve as director, and what the ownership structure looks like. These decisions determine which legal form is optimal and which obligations arise immediately upon incorporation. Some investors also consider acquiring an already-registered entity. Our blog on shelf companies in Serbia covers when that makes sense. The most common mistake: founders make this decision intuitively, without calculating the tax implications.
Step 2: Choose the Company Name
The company name must be unique in the BRA register. Availability can be checked before formally initiating the procedure via the BRA company name search. The name must include the designation of the legal form (d.o.o., a.d., etc.). Detailed rules and common disputes with the BRA are covered in our blog on choosing a business name in Serbia.
Step 3: Determine the Registered Address
The company must have a registered business address in Serbia. This can be physical office space or a virtual office. A virtual office is legal and sufficient for registration purposes, but it does not automatically entitle the director to a residence permit based on that address.
Step 4: Draft the Founding Document
The founding document (the Memorandum of Association for multi-member LLCs or the Decision on Incorporation for single-member LLCs) is the key legal instrument in company formation in Serbia. It must be prepared and signed in electronic form. An attorney can certify and submit the documentation by special power of attorney, which is particularly practical when the founder is not present in Serbia.
Step 5: Submit the BRA Registration Application
The registration application is submitted to the BRA exclusively electronically, either directly or through a representative. The deadline for submission is 15 days from the execution of the founding document. The application must include:
- Founding document in electronic form
- Copy of identity documents of the founder and director
- Special documents for foreign founders (apostilled or legalised, depending on the country of origin)
- Proof of payment of the BRA fee
Step 6: Receive the BRA Decision on Registration
The BRA issues a decision on entry in the Register of Business Entities within 3 to 5 business days of submission of complete documentation. Company formation in Serbia is considered complete only upon delivery of that decision. The decision assigns the Tax Identification Number (TIN), the Company Identification Number (CIN), and the National Health Insurance Fund number.
Step 7: Open a Corporate Current Account
Following the BRA decision, the company must open a current account at a bank. The company cannot legally make or receive payments until the account is active. The bank conducts a KYC (Know Your Customer) review, which can take anywhere from one business day to several weeks, depending on the bank and the complexity of the ownership structure.
Costs of Company Formation 2026: BRA Fee Table
| Item | Amount (RSD) | Amount (EUR, approx.) | Note |
|---|---|---|---|
| LLC registration, online | 5,900 RSD | ~€50 | BRA e-registration |
| LLC registration, classic | 6,500 RSD | ~€55 | Filed through a representative |
| Entrepreneur registration, online | 2,900 RSD | ~€25 | Least expensive option |
| Notary fee (signature certification) | 2,000–5,000 RSD | ~€17–43 | Variable by notary |
| Virtual office (monthly) | 3,000–10,000 RSD | ~€25–85 | Variable by provider |
| Legal fees for incorporation | By agreement | €200–800 | Depends on complexity |
| LLC share capital (minimum) | 100 RSD | <€1 | Symbolic; €250 recommended for residence permit |
The BRA fees listed above are current as of the date of updating this text (March 2026). Incorporating in Serbia ranks among the most affordable in the region, though the total cost depends on the legal form chosen and the professionals engaged. Fees are periodically revised by government decree, so we recommend checking the official BRA website before filing.
Company Formation in Serbia for Foreign Nationals
Company formation in Serbia is fully open to foreign nationals: a foreign national can be the sole founder and sole director, with no restrictions on ownership percentage or management. The procedure is identical to that for domestic persons, with some technical differences in documentation.
A foreign founder who is not present in Serbia can complete the entire process through an authorised representative, on the basis of a special power of attorney. This includes signing the founding document, provided the representative is specifically authorised to do so.
Legalisation and Apostille
For foreign documents, such as a power of attorney, to be accepted in Serbia, they must as a rule be certified. Three procedures apply:
- Full legalisation for countries that have not signed the Hague Convention
- Apostille for Hague Convention signatory states, which is the most common case
- Bilateral agreement: Serbia has mutual exemption from legalisation agreements with a number of countries, including Austria, Czech Republic, Slovenia, Italy, Greece, Croatia, Bulgaria, Hungary, the Russian Federation, Ukraine, and others
To verify which procedure applies to a specific country, contact us directly or consult the bilateral treaty database on the Ministry of Justice website.
Temporary Residence Through Company Formation
Forming a company in Serbia can serve as the basis for obtaining a temporary residence permit, but that connection is not automatic. The foreign national must satisfy additional conditions. A complete guide is available in our blog on temporary residence in Serbia by company formation.
Online Company Formation in Serbia
Since May 2023, all registration of business entities before the BRA is conducted exclusively electronically. Physical submission of documents at a BRA counter is no longer an option for LLC or entrepreneur registration.
For electronic LLC registration, the following are required:
- A qualified electronic certificate (electronic signature)
- An installed smart card reader and the NEXU application for electronic signing
- A MasterCard, Visa, or DinaCard payment card to pay the BRA fee
A limitation that is often overlooked: electronic registration is available for single-member LLCs where the founder is a domestic natural or legal person, or a foreign natural person. Multi-member LLCs with a foreign legal entity as a founder must use a representative for electronic filing. A more detailed guide is available in our blog on online company registration in Serbia.
Opening a Corporate Bank Account
The company must open a current (corporate) account at a bank registered in Serbia immediately upon receiving the BRA decision. The company cannot receive or make payments until the account is activated.
Banks that accept applications from non-residents and foreign companies include Raiffeisen Bank, UniCredit Bank, Intesa Banka, OTP Bank, and Erste Bank. Each bank has its own conditions and documentation requirements.
Standard documentation for opening a corporate account:
- BRA decision on registration
- Founding document
- Identity document of the director and authorised representative
- OP form (certified signatures of authorised persons)
- Signature card (specimen signature card for the bank)
- KYC documentation on ownership structure (UBO) for foreign founders
Account opening time ranges from one business day to several weeks. A more complex ownership structure and foreign founders extend this process due to KYC requirements. Details for non-residents are available in our blog on opening a non-resident bank account in Serbia.
Post-Incorporation Obligations: Tax, Accounting, VAT
Registration with the BRA is only the first step of company formation in Serbia. Immediate legal obligations arise upon incorporation that many founders underestimate.
Advance Tax Return (Deadline: 15 Days)
Within 15 days of the registration date, the company must file PPP DG-1S (for an LLC) or PP OPJ-K (for entrepreneurs). This return reports estimated revenues for the current year, which determines the monthly advance corporate income tax payments. Late-filing penalties are automatic. More on the Serbian tax system is available at the Tax Administration website.
Accounting
Every registered company in Serbia is required to maintain business records in accordance with the Accounting Act. For small business entities and entrepreneurs, engaging an accounting firm from the very beginning of the incorporation process is recommended, not as an afterthought.
VAT Registration
The VAT registration obligation arises when the company reaches a turnover threshold of 8,000,000 RSD (approximately €68,000) per year. Voluntary registration before reaching that threshold is possible and makes sense for companies that operate primarily with VAT-registered clients. More on VAT rules is available at propisi.gov.rs.
Employee Registration and Payroll Tax
Every employment relationship requires registering the employee with the Pension and Disability Insurance Fund (PIO) and the National Health Insurance Fund (RZZO), and paying payroll taxes and contributions. A founder who works within the company must be registered and pay contributions even if they do not draw a salary.
Tax Incentives for Foreign Founders and Innovative Startups
Serbia offers several tax incentives that are relevant at the point of company formation in Serbia. Even at the planning stage, it is worth understanding which benefits are available.
Incentives for Employment of Returnees and Foreigners
A person who enters into an employment relationship in Serbia after residing abroad for at least three months may qualify for payroll tax incentives. More on this topic is available in our blog on tax incentives for startups in Serbia.
Tax Incentives for Innovative Startups
Companies registered in the Register of the National Innovation System (NIS) can use payroll tax exemptions for employees working on R&D activities. Founders of innovative startups who register with the NIS have access to these benefits.
| Type of incentive | Who can use it | Amount and effect | Legal basis |
|---|---|---|---|
| Corporate income tax exemption (IP Box) | Companies with IP income (software, patents) | Up to 80% of IP income excluded from taxable base | Corporate Income Tax Act, Art. 25g |
| R&D payroll tax exemption | Companies in the NIS register | 70% of payroll taxes and contributions on R&D staff | Personal Income Tax Act, Art. 21v |
| Returnee employment incentive | Persons arriving from abroad | Payroll tax exemption for up to 3 years | Personal Income Tax Act, Art. 15l |
| Investment tax credit | LLCs investing in fixed assets | Up to 20% of investment costs | Corporate Income Tax Act, Art. 48 |
Most Common Mistakes When Forming a Company in Serbia
In practice, several mistakes appear with uncommon regularity. A broader treatment of legal pitfalls specific to Serbian startups is available in our blog on fatal legal mistakes startups make in Serbia.
1. Missing the First Tax Filing Deadline
The 15-day deadline for filing the advance tax return is regularly missed, particularly by founders managing their own administration. Penalties are automatic and the tax authority has no discretion to waive them.
2. Wrong Choice of Legal Form
A common situation: the founder chooses an LLC because it sounds more serious, but entrepreneurship is optimal given the lower tax burden and a business activity with low commercial risk. Or the opposite: the founder registers as an entrepreneur to save costs, then realises a year later that their clients, being legal entities, are reluctant to deal with non-VAT-registered counterparties and require an LLC structure.
3. Virtual Office Without Considering Residence Permit Implications
A foreign founder intending to apply for a residence permit through their company must understand that registering the company at a virtual address does not automatically confer residence rights. Additional conditions must be satisfied.
4. Incomplete KYC Documentation for the Bank
Foreign founders frequently underestimate the bank's documentation requirements. KYC procedures for foreign legal entities can require a dozen certified documents. Preparing the full documentation set in advance reduces account opening time from weeks to days.
5. Commingling Business and Personal Finances
Entrepreneurs who use their personal bank account for business transactions not only breach the law but also jeopardise their legal position. Piercing the corporate veil is far easier to establish when it is evident that the founder mixed assets.
Frequently Asked Questions
Who can form a company in Serbia?
Any natural or legal person, regardless of citizenship. Serbian residency is not required. Both the founder and the director can be foreign nationals.
How much does LLC formation in Serbia cost in 2026?
The BRA administrative fee is 5,900 RSD (approximately €50) for online registration or 6,500 RSD (approximately €55) for the classic procedure. An LLC in Serbia is the least expensive form of limited liability entity. Total realistic costs, including notary certification and legal assistance, range from €500 to €1,500.
How long does company formation in Serbia take?
Company formation in Serbia moves quickly: from submission of complete documentation to the BRA, the incorporation decision arrives in 3 to 5 business days. The full process, including documentation preparation and opening a bank account, most commonly takes 10 to 15 business days.
Can a foreign national be the sole owner of a company in Serbia?
Yes. There are no restrictions on foreign ownership of Serbian business entities. A foreign founder can hold 100% of an LLC's shares.
Is physical presence in Serbia required to form a company?
No. The entire process can be completed by an authorised representative on the basis of a special power of attorney. The founder need not be present, but the power of attorney must be properly apostilled or legalised.
What is the minimum share capital for an LLC?
Formally: 100 RSD (less than €1). For founders intending to apply for a temporary residence permit in Serbia on the basis of company formation, a minimum capital of €250 is recommended.
Does an LLC need a director who is a resident of Serbia?
No. The director of an LLC can be a foreign national who is not a resident of Serbia. If that director needs to work in Serbia, they will require a unified temporary residence and work permit.
When does the VAT registration obligation arise?
The obligation arises when the company reaches an annual turnover of 8,000,000 RSD (approximately €68,000). Voluntary VAT registration before reaching that threshold is also possible.
Planning Company Formation in Serbia?
Zunic Law provides comprehensive legal support throughout the company formation process in Serbia: selecting the optimal legal form, preparing incorporation documentation, representing clients before the BRA, and coordinating with the bank. Contact us through our corporate and commercial law practice page.
