Looking to hire in Serbia

Sick leave requires a medical certificate from the first day of absence. Employers must ensure that employees provide this documentation to validate sick leave and process it correctly.

Employees in Serbia must submit current-year expenses within 60 days of the expense date or within 30 days after returning from a business trip, whichever is later. Prior-year expenses are only accepted until February 1 of the following year.

Mileage and fuel cannot be reimbursed tax-free in Serbia unless the vehicle is owned by the Serbian employing entity, but a taxable car allowance can be offered instead. All expenses are treated as taxable and grossed up, except business trip expenses for travel and accommodation, which can be reimbursed on a non-taxable basis when properly documented. Supporting documentation must include the employer’s information, and original receipts and invoices for business trip expenses must be sent to the employer for non-taxable reimbursement.

Internet, mobile phone, and coworking costs can be reimbursed in Serbia, but they are treated as taxable benefits and will be grossed up. Employees must provide a tax invoice or receipt showing when and with whom the expense was incurred and what was purchased.

Work equipment and supplies, including laptops and software subscriptions, are reimbursable but treated as taxable and grossed up. A tax invoice or receipt must show the date, amount, merchant or service provider, and a brief description of the goods or services.

Business travel costs are split between non-taxable core trip costs and taxable local transport and similar items. Flights (including luggage fees), accommodation, visas, and business trip travel insurance can be reimbursed on a non-taxable basis when supported by proper invoices or receipts, and accommodation booked via Airbnb is not accepted. Local transport such as taxis, trains, public transport, car rental, parking, tolls, and fuel is reimbursable but taxable with a gross-up. For non-taxable travel and accommodation, documentation must show the date, amount, merchant or service provider, and, where required, the employee’s name and a description of the service.

Employee meals, client or partner meals, and groceries can be reimbursed but are treated as taxable income in Serbia, with a gross-up applied. A tax invoice or receipt must show the date, amount, and the merchant or service provider.

Training, courses, books, promotional items, and gifts may be reimbursed but are treated as taxable and grossed up. These expenses generally require a tax invoice or receipt showing the date, amount, merchant or service provider, and a description of the purchase or service, except for gifts where no specific content is required on the document beyond the receipt itself.

For any business trip that includes an overnight stay, Serbia requires formal business travel forms. These must capture the travel dates, destination, and business purpose, and expenses for travel, accommodation, and meals submitted without the required forms may be treated as taxable.

Under Serbian labor law, employees are entitled to reimbursement of business travel costs, including a daily allowance (per diem). Serbian tax rules distinguish between non-taxable travel-allowance thresholds, which are periodically adjusted, and non-taxable meal allowances, which do not have a fixed threshold.

Bonuses in Serbia, including contractual and discretionary payments, incentives, and commissions, are taxed as regular income and attract the same social security contributions as salary. Serbia applies flat statutory rates by income category for ordinary salary and also levies an additional annual surtax on high earners, with 10% applied on income between three and six times the average annual salary and 15% (25% total) above six times the average annual salary. An age-under-40 relief allows qualifying younger taxpayers to deduct three average annual wages from the surtax base, which can materially affect gross-up calculations for large bonus payments.