Discover the Benefits of Company Registration in Serbia
Serbia’s legal landscape provides a welcoming environment for the company registration, open to individuals and legal entities globally, regardless of citizenship. Unlike some countries facing restrictions and sanctions, Serbia embraces inclusivity. Notably, there are no constraints on the nationality of founders or the legal representative, offering flexibility even in international scenarios. For instance, both the shareholder and the managing director could be citizens of the Russian Federation without impediments.
The process of company registration, especially for straightforward ownership structures, is streamlined, allowing for efficient completion in just over 7 business days.
Serbia boasts one of Europe’s lowest corporate income tax rates, a competitive advantage set at 15%. This stands in stark contrast to other European counterparts like Portugal (31.5%), Germany (29.9%), France (29.9%), and Spain (25%).
In addition to the favorable tax landscape, Serbia provides substantial non-refundable funds to founders, particularly benefiting startups engaged in innovative activities such as the IT sector. Noteworthy tax incentives are also extended to the employment of foreigners and young returnees, particularly within the realm of innovative endeavors.
From a cost-effectiveness perspective, Serbia emerges as an attractive destination for initiating a new business. The costs associated with company registration remain comparatively low in comparison to regional counterparts, and administrative expenses for newly established companies are nominal.
Essential Steps in Company Registration Process
When embarking on the journey of a company formation in Serbia, it is paramount to entrust this process to a reputable law firm specializing in company registration matters. Opting for a law firm provides distinct advantages, ensuring expertise, compliance with regulatory nuances, and comprehensive legal support throughout the entire company registration process.
Before initiating on the company registration process, it’s crucial to make informed business decisions. Here are key considerations:
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- Choosing the Right Business Name: Select a distinctive and suitable name for your company.
- Determining the Legal Form: Opt for a legal structure that aligns with your business objectives.
- Selecting a Company Headquarters Address: Choose a strategic and compliant business address.
- Defining the Core Business Activity: Clearly outline the primary activities of your company.
- Appointing Managing Director(s): Designate individuals to manage and represent the company.
- Determining Share Capital: Make decisions related to the amount of the share capital.
- Selecting a Bank: Identify the bank where you intend to open the company’s business account.
Once these critical decisions are made, you’re ready to initiate the company registration procedure, which involves four main steps:
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- Company registration with the Serbian Business Registers Agency (SBRA)
- Company Bank Account Opening
- Obtaining an Electronic Signature and Ultimate Beneficial Owners (UBO) Registration
- Submission of the First Tax Applications
Choosing the Appropriate Legal Form for Your New Company
When considering the suitable legal form for your new company in Serbia, various legal entities can be established, including:
- Limited liability company (LLC)
- Entrepreneur
- General partnership company
- Limited partnership company
- Joint-stock company
Limited Liability Company (LLC)
The Limited Liability Company (LLC) is a prevalent choice, characterized by its flexibility. In an LLC, one or more entities, whether natural persons or legal entities, hold shares in the company’s capital. The minimum required share capital for LLC registration is a nominal amount, only RSD 100.00 (approximately EUR 1.00).
Shareholders in an LLC bear liability for the company’s obligations up to the extent of their invested stakes. This limited liability ensures that a shareholder’s private assets remain separate from the company’s financial responsibilities. However, it’s crucial to note that shareholders may become liable if they misuse the rules of limited liability outlined by the law.
Entrepreneur
Another option is the Entrepreneur structure, offering simplicity in the company registration process. Entrepreneurs are not obligated to deposit a specific amount as share capital. However, this structure entails personal liability for the entrepreneur, as their personal assets are not distinct from their business. Therefore, an entrepreneur is personally liable for the company’s obligations.
The Entrepreneurship option provides ease in the company registration process and daily operations. Entrepreneurs may also choose a flat-rate taxation system, with more lenient fines for business irregularities.
Choosing the Right Legal Form for Your Business
The choice between Entrepreneurship and an LLC depends on factors such as business activity, planned hiring, and expected revenue. Seeking professional advice before finalizing the legal form of your new company is highly recommended for informed decision-making.
Company Registration with the Serbian Business Registers Agency (SBRA)
The initial step in commencing the registration of a company in Serbia involves its registration with the Serbian Business Registers Agency (SBRA). This pivotal measure guarantees the lawful acknowledgment and formal establishment of the company within the Serbian legal framework.
The procedural sequence commences with the meticulous preparation of crucial documents, including the Memorandum of Association and the Decision on the appointment of company representatives. These foundational documents serve as the bedrock of the company’s legal identity, delineating its objectives, structure, and governing principles. They provide a comprehensive framework in alignment with Serbian legal norms.
A distinctive aspect of this establishment process is its exclusive online nature. The SBRA mandates that all documentation, comprising the Memorandum of Association and related establishment documents, be submitted in electronic form. In this phase, Serbian attorneys play a pivotal role, not only in preparing documents but also in the certification process. They are authorized to certify and transform requisite physical documentation into electronic formats. This certification adds an extra layer of credibility to the company’s establishment, ensuring adherence to the stringent regulatory requirements of the SBRA.
Bank Account Opening
After completing the SBRA company registration, the subsequent step involves initiating the process of opening a company bank account with a chosen financial institution. Careful consideration is crucial in selecting a bank, particularly for individuals from EU-sanctioned states. Seeking legal advice is highly recommended to navigate this aspect successfully.
Electronic Signature and Ultimate Beneficial Owners (UBO) Registration
Securing an electronic signature from an accredited issuer, such as the Ministry of Internal Affairs, the Post of Serbia, or the Chamber of Commerce, is a compulsory prerequisite for the appointed company representative, typically the director.
The registration of Ultimate Beneficial Owners (UBO) must be diligently executed within 15 days from the formal establishment of the company. This requirement aims to establish transparency in ownership structures, aligning with prevailing legal standards and regulatory expectations.
First Tax Applications
Within 15 days of SBRA registration, the newly formed company must submit its first tax application, known as the advanced tax application. This not only fulfills the statutory obligation to tax authorities but also involves a subjective assessment of the potential profit for the company’s first year, thereby determining its tax obligation for that period. If the company hires employees and registers as a VAT taxpayer, additional obligations may apply.
When it comes to tax applications, it is advisable to engage the services of an professional accounting firm in Serbia.
Virtual Office and Purchase of Shelf Company
In an era where many professionals operate as business nomads, a virtual office in Serbia emerges as a practical solution. It encompasses a suite of services provided by the virtual office provider, including a virtual address, occasional use of office space, mail handling, a registered phone number, and call filtering with message forwarding.
For individuals aiming for a streamlined process, the prospect of acquiring a pre-established company, instead of company registration, holds considerable appeal. This astute manoeuvre affords the opportunity to sidestep the intricate and time-intensive bureaucratic procedures, presenting a distinct advantage, especially for founders who are not residents in Serbia.
The information in this document does not constitute legal advice on any particular matter and is provided for general informational purposes only.