HOW TO OPEN A NON-RESIDENT BANK ACCOUNT IN SERBIA?

03
Mar 2021

Contact: Kristina Vuljaj

Non resident bank account Serbia, offshore business bank account

Have you ever wondered what are the benefits of opening a non-resident bank account in Serbia?

Were you ever in need of a long-term or continuous solution for receiving money or depositing money in a foreign country?

WHAT IS A NON-RESIDENT BANK ACCOUNT?

Relying on the laws of the Republic of Serbia, a non-resident bank account is a bank account whose beneficiary is a natural person or legal entity, who permanently resides or is registered in a foreign country.

Hence, it does not rely on the person’s citizenship or company’s place of management, but rather their registered center of life or business activities.

Non-resident bank account in Serbia can be opened in RSD (Serbian Dinar) or any other currency.

WHO CAN OPEN A NON-RESIDENT BANK ACCOUNT IN SERBIA?

A beneficiary of a non-resident bank account in Serbia can be a natural person, as well as a legal entity, such as a company, branch, representative office, etc.

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WHAT ARE THE BENEFITS OF HAVING NON-RESIDENT BANK ACCOUNTS IN SERBIA?

There are numerous benefits of having a non-resident bank account in Serbia and they depend on the individual or dedicated need of each natural or legal person. We will briefly outline several benefits of opening a non-resident bank account in Serbia, depending on whether a non-resident is a natural or legal person.

Benefits of having a non-resident bank account in Serbia for natural persons

1. Common transactions

The non-resident bank account can be used for all common transactions such as receiving payments, ordering transfers, withdrawing money, etc.

The bank issues Visa or Master cards, which can be used anywhere in the world.

2. Savings Account

A non-resident may open a savings account in the Republic of Serbia. Maybe you are planning to retire in a foreign country, so you wish to keep the retirement fund safely in a foreign country. This way, it will be preserved and more independent from your obligations and activities in your country of residence.

On the other hand, the transaction fee from moving that money to the third country may be lower in Serbian banks than in the banks in your country of residence.

3. Special-purpose account in Serbia

The special-purpose account can be used if you are interested in investing in the stock market or other similar investments.

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Benefits for companies with international/cross-border interest and cooperation in Serbia

For example, if you have a long-term business partner in Serbia and your cooperation requires two-way payments or investments, having a non-resident bank account, which you will be able to manage, even remotely, would be very convenient. It will save you and your partner’s time and money because you will not need to bother with the procedures of international transfers and pay large fees for this transfer. Hence, this would lower your costs and make the international project and business cooperation more convenient and lucrative.

On the other hand, if a foreign company has some form of business entity registered in Serbia, a non-resident business bank account will even be required in some cases. In cases when it is not required, it will certainly make the investment in the company’s business activity in Serbia less costly, more efficient, and easier.

However, if the foreign company does not operate in Serbia yet, the non-resident bank account may be useful for future investments.

Fees for opening a non-resident bank account and transaction costs

Overall, the banks operating under the regulations of the Republic of Serbia have lower transaction costs for international transfers. Although they differ from bank to bank, a common example would be 0.4% or a minimum of 5 EUR.

Also, the bank fees for maintenance of an RSD bank account are exceptionally low, ranging from 5 to 10 EUR, whereas the maintenance of a foreign currency bank account is free of charge.

MANAGING A NON-RESIDENT BANK ACCOUNT

If all of this sounds great to you, but you still have some reservations, they probably lay in questions such as:

  • How can I manage my non-resident bank account?
  • Do I need to undertake some actions in person, in Serbia?
  • Do I have full control of my account?

There is no need to worry, as you can manage your bank account from anywhere in the world. Namely, the bank can issue debit cards, Visa, or Master Card, which you can use at any convenient ATM, as well as for payment.

Serbian banks also offer online banking and mobile banking, with which your access to the account is always at your disposal.

You can always transfer money from the non-resident bank account to your other bank accounts in Serbia or any foreign country.

OPENING A NON-RESIDENT BANK ACCOUNT IN SERBIA FOR NATURAL PERSONS

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As a non-resident, a natural person can open a bank account in Serbia by personally initiating the procedure in the bank.

After the request for opening and maintaining the bank account is filed at the bank, it takes a few days for the bank to approve the client.

Upon approval, you would be requested to come to the bank again to sign all of the documents and collect a copy of your contracts. From that day, your bank account is active.

Opening non-resident bank accounts remotely

However, if a person does not want or cannot travel with the sole purpose of opening the bank account, which is especially reasonable in situations like the COVID-19 pandemic, the bank account can be opened remotely, by an attorney with the Special Power of Attorney. In that case, your activity would be minimal, and you will be able to use the bank account pretty quickly, without the need to travel or to go to the bank.

OPENING A NON-RESIDENT BUSINESS BANK ACCOUNT IN SERBIA

Foreign legal entities may open a non-resident business bank account, represented by their legal representative before the bank agent, as well as remotely. There, the company’s Managing Director or legal representative, does not have to be present for opening the company’s non-resident business bank account.

To open the non-resident business bank account, the client will need to go through the approval procedure in the bank. This procedure consists of reviewing the company’s registration and ownership documentation. Given the fact that in this case, the bank will check the company’s data as well as the data on the natural persons who own or represent the company, as well as the fact that the company may be only a link in the larger chain, the procedure of approval may take a bit longer compared to the approval procedure for non-resident bank of a natural person.

However, even then, it is only a matter of a few days.

NECESSARY DOCUMENTATION AND RELEVANT INFORMATION

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To give you an idea of the information that needs to be presented and revealed to the bank’s management and available to the Serbian National Bank, we can refer you to the documentation which will be required by the bank.

In that matter, the company will need to present a newly issued registry act, i.e., the extract from the official business registry, which contains all the relevant information on the company.

On the other hand, the company will need to prove or to state its Ultimate Beneficial Owner (hereinafter: UBO).

Revealing and registering the UBO is an obligation of the bank and other government institutions or institutions that provide services to the public sector, according to The Law on the Prevention of Money Laundering and the Financing of Terrorism.

To give you an idea of the information that needs to be presented and revealed to the bank’s management and available to the Serbian National Bank, we can refer you to the documentation which will be required by the bank.

In that matter, the company will need to present a newly issued registry act, i.e., the extract from the official business registry, which contains all the relevant information on the company.

On the other hand, the company will need to prove or to state its Ultimate Beneficial Owner (hereinafter: UBO).

Revealing and registering the UBO is an obligation of the bank and other government institutions or institutions that provide services to the public sector, according to The Law on the Prevention of Money Laundering and the Financing of Terrorism.

Who is a UBO?

UBO represents:

1. A natural person who owns, directly or indirectly, 25% or more of the business interest, shares, voting rights, or other rights, based on which they participate in controlling the legal person, or who participates in the capital of the legal person with 25% or more of the interest, or a natural person who indirectly or directly has a dominant influence on business management and decision-making.

2. A natural person who has provided or provides funds to a company in an indirect manner, which entitles them to influence significantly the decisions made by the managing bodies of the company concerning its financing and business operations.

Obtaining the tax ID in Serbia

To open the non-resident business bank account, the company does not have to be a tax resident of Serbia. However, some of the banks that offer the service of maintaining non-resident business accounts will open the account only for the companies that are Serbian tax residents. Namely, they require their clients to obtain a Serbian tax ID number.

This makes the procedure of opening a non-resident business bank account in such a bank more complex because it consists of two phases.

How can a foreign company obtain a tax ID in Serbia?

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A tax ID in Serbia is assigned to the natural or legal entities by the Serbian Tax authority. However, to obtain it, a legal entity will need to justify the application for the tax ID by proving future income, or business that may be subject to taxation in Serbia.

Condition

If a company proves its expected income in Serbia, a business project, or cooperation, which takes place or is in connection to Serbia, the tax authority will issue a tax number to the foreign legal entity. However, this entity will also need to provide a tax representative who is a Serbian resident.

Given the fact that this initial step is more challenging than the actual process before the bank, it is important to make the right choice of a bank, one which will not require this as a precondition.

LEGALITY OF HAVING A NON-RESIDENT BANK ACCOUNT IN SERBIA

Is it illegal to have an offshore bank account?

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Having a non-resident bank account is legal in Serbia, however, the repercussions are carried by the client, and they differ from country to country, depending on the regulations in each foreign state.

Furthermore, whether your country will be notified of the fact that you have a non-resident account opened in Serbia and what other information it expects regarding the account activity depends on the foreign country in question.

For that matter, Serbia is a member of the Egmont group, and participates in the activities of the Eurasian group for the prevention of money laundering. The activities in these bodies imply general cooperation and commitment to preventing money laundering within their members.

On the other hand, Serbia has the most specific cooperation with the US, given the fact that the two countries entered the bilateral treaty regarding the recognition of the FATCA regulations in Serbia.

As a country striving to become a member of the European Union and a member of the European Council and its Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism, over the years, the Republic of Serbia has adopted several regulations on the foreign currency transactions, international transfers among which the most important one is the Law on the Prevention of Money Laundering and the Financing of Terrorism. Under this Law, apart from keeping the data on their clients, the information on the bank account beneficiary and transaction activities are also kept for 10 years.

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