Lump-Sum Tax in Serbia in 2026: Limits and Calculation

The lump-sum tax (paušalno oporezivanje) is the main reason freelancers and small studios choose Serbia. Instead of tracking income and expenses, a sole proprietor (preduzetnik) pays a fixed amount every month, and that amount already includes income tax and all social contributions. No year-end returns, no reconciling expenses — just a book of revenue records and a payment by the 15th.

That said, the regime comes with conditions, and breaching them is easier than it looks: exceeding the revenue limit, choosing the “wrong” activity code, or ending up in a situation where your only client is effectively your employer. Below is how the lump sum works in 2026, what goes into the amount and what the tax authority checks.

Who can choose the lump-sum regime

• Only a sole proprietor (a natural person registered with the APR). There is no lump-sum regime for a DOO.
• Annual revenue does not exceed 6,000,000 dinars. The limit is counted per calendar year; if you register mid-year, it is reduced proportionally.
• The sole proprietor is not registered for VAT (PDV). Mandatory VAT registration kicks in once revenue exceeds 8,000,000 dinars over any 12 consecutive months, and with it the right to the lump sum is lost.
• The type of activity is not on the list of exclusions: wholesale and retail trade, hotels and restaurants, financial intermediation and real estate, advertising and market research, accounting, audit and tax services.

Software development, IT consulting, design, translation, training, engineering and architectural services, photo and video production — all of these are available under the lump sum. The application to choose the regime is filed together with registration at the APR; if you do not file it, the sole proprietor is automatically placed on actual-income accounting.

How the tax authority calculates the amount

Since 2020 the calculation has been standardized and fully automated. The decision (rešenje) setting the amount of the lump-sum tax normally appears in your ePorezi account within two days of registration, and the amount is worked out using a formula published in a government regulation.

1. The starting base is taken: the average monthly salary for the previous year in the municipality where the sole proprietor is registered.
2. The base is multiplied by the coefficient for the type of activity: every code in the classifier has its own, and for IT services it is one of the highest.
3. Adjustments are applied: for the first year of operation, for age, for pensioner status or disability, and for being simultaneously employed under an employment contract.
4. The resulting base is charged with 10% income tax and social contributions: 24% pension, 10.3% health, 0.75% unemployment. The result is the monthly amount.

The easiest way to check the exact amount for your activity code and municipality in advance is the lump-sum tax calculator on the website of the Serbian Tax Administration. Figures found online go stale within a year, so rely on the calculator rather than on forums.

Why Belgrade is more expensive than Novi Sad

The only variable in the formula you can influence is the municipality of registration. The starting base is the average salary in that specific municipality, not the national one. In the central municipalities of Belgrade (Stari Grad, Vračar, Savski Venac, Novi Beograd) salaries are the highest in Serbia, so the lump sum there is higher too. In Novi Sad the base is lower, and in Niš, Kragujevac and Subotica lower still.

The practical conclusion follows: the sole proprietor’s registration address directly affects the tax amount. At the same time the address must be real — the tax authority can carry out an inspection there, and the owner of the premises must give consent. If you live in Belgrade but register in another city purely for the tax, be ready to explain where you actually work. We wrote about address requirements and the risks of “mass” addresses in our article on the registered seat; options with a genuine lease agreement are described on the virtual office in Serbia page.

The independence test: nine criteria

The independence test (test samostalnosti) was introduced to distinguish a genuine entrepreneur from an employee registered as a sole proprietor in order to save on taxes. The sole proprietor’s relationship with each client is assessed separately. If five or more of the nine criteria are met in a given sole proprietor and client pairing, income from that client stops counting as entrepreneurial income.

1. The client determines the sole proprietor’s working hours, holidays and time off.
2. The sole proprietor normally works on premises provided by the client.
3. The client organizes training or professional development for the sole proprietor.
4. The client found the sole proprietor through a job advertisement or a recruitment agency.
5. The client provides equipment and tools, or manages the work process.
6. At least 70% of the sole proprietor’s revenue over 12 months comes from that client.
7. The sole proprietor bears no entrepreneurial risk for the outcome of the work.
8. The contract prohibits the sole proprietor from providing services to other clients.
9. The sole proprietor works for the client for more than 130 working days over 12 months.

The consequences of failing the test: the income is taxed as “other income” — 20% tax plus pension contributions, and the Serbian client is obliged to pay them as tax agent. If the client is foreign, the obligation falls on the sole proprietor. Foreign companies working with Serbian contractors are aware of this and often require the sole proprietor to confirm that they have other clients.

What happens when you exceed the limits

If revenue for the calendar year exceeded 6,000,000 dinars, the sole proprietor loses the right to the lump sum from the following year and must switch to actual-income accounting: keeping books, hiring an accountant, filing an annual return. If revenue over 12 consecutive months exceeded 8,000,000 dinars, VAT (PDV) registration becomes mandatory — within 15 days — and the lump sum ends immediately.

At that point a growing business should compare two routes: staying a sole proprietor on self-assessment, or registering a DOO. We have gathered the arguments for and against in our article sole proprietor or DOO in Serbia. If the switch is unavoidable, it is better to prepare the accounting in advance — bookkeeping services for Serbian companies are easier to set up before rather than after the change of regime.

Obligations of a lump-sum sole proprietor

• Pay the monthly amount set by the tax decision by the 15th of the following month. Late payment means interest at the National Bank of Serbia rate plus 10 percentage points.
• Keep the book of revenue records (KPO) and retain the invoices you issue.
• Hold a separate business account for the sole proprietorship with a Serbian bank.
• Watch the 6,000,000 and 8,000,000 dinar limits — the tax authority learns about a breach from bank data and SEF.
• Notify the tax authority of any changes: a change of activity code or address, or suspension of activity.

The first decision on the amount arrives in ePorezi within roughly two days of registration, and for the month of registration the tax is charged pro rata for the days worked. Every year in early January the tax authority issues a new decision using the same formula with an updated base — it appears in your account automatically, and no application is needed. If the decision has not arrived or the amount looks wrong, the sole proprietor has the right to appeal it within the set deadline, and an appeal does not suspend the obligation to pay.

The lump sum remains one of the most comprehensible tax regimes in Europe for someone who works with their own head and hands. It does not suit trade, arrangements with a single employer, or a business that quickly outgrows the limit. If your case fits within those boundaries, registering a sole proprietorship takes a few days, and the decision on the tax amount arrives almost immediately.