The tax incentives which have been introduced in Serbia in the past years in the field of research and development demonstrate the increasing importance of encouraging innovations and enterprise. You can read more about the already existing tax incentives in the Serbian legal system in our text Checklist of Tax Incentives for Companies In Serbia – Don’t Give Away Your Money Just Yet!
The first R&D incentive in Serbia for companies working on research and development, which enabled the research and development expenses to be counted in the double amount in the tax balance, allowing the possibility of a significant reduction of the corporate income tax base of such companies.
R&D incentives have gone a step further by presenting the solution in the form of the Personal Income Tax Law from the beginning of the year, which provides tax exemption from the obligation to pay 70% of taxes for salaries of employees who are directly engaged in research and development, proportionally with the time these persons spend on such positions.
The abovementioned incentive has been applied since March 1, 2022, and in mid-April, the Government adopted the special Rulebook on the conditions and manner of exercising the right to tax exemption based on salaries of employees engaged in research and development (hereinafter: Rulebook), which specifies the conditions for exercising the tax exemption.