Living in Serbia: A European Haven for Those Seeking Freedom and Low Taxes

Today we are going to explain why Serbia can be a great option for those seeking a life with greater freedom and low taxes.

At Denationalize.me, we like countries that treat their inhabitants well, and Serbia offers excellent value for money for those seeking freedom-friendly countries.

Serbia is a landlocked country located in the center of the Balkans and offers beautiful landscapes, especially in the central and eastern parts of the country. Its geographical position makes it a historical crossroads, where Eastern and Western cultures converge.

The climate is continental, with hot, humid summers and dry, cold winters. In January, temperatures can drop below freezing, especially in the mountainous interior, while in July and August they easily exceed 30°C in cities such as Novi Sad and Niš.

The national currency, the Serbian dinar (RSD), is approximately 117 RSD to the euro, and the average cost of living is around 700 euros. Belgrade has approximately 1.5 million inhabitants and, in terms of cost of living, is one of the most affordable cities of its size in Europe.

The official language is Serbian, written in both the Cyrillic (Russian) and Latin alphabets, although most young people understand English reasonably well. The currency is the Serbian dinar, although in tourist areas you can also pay in euros (for a small surcharge).

Serbia is not part of the EU or the Schengen area. However, similar to what happened until 2025 with Bulgaria and still happens today with Montenegro, Serbia has found a way to help citizens from outside Europe stay longer in Europe by allowing them to travel between Serbia and Schengen countries. In addition, Serbia has good international air connections through Belgrade’s Nikola Tesla Airport.

Serbia is becoming increasingly attractive to visitors and residents, and Belgrade and Novi Sad, as major English-speaking centers, are welcoming more visitors every year.

With Serbia offering both a dynamic tech scene and a culture of leisure and healthy living, it is becoming an attractive destination for residents. It also offers a kind of visa for digital nomads, as well as opportunities to minimize income tax for foreigners.

Home ownership and gun ownership are very high, and almost everyone owns land somewhere in the countryside where they can buy natural produce and goods. The country is rich in natural water sources, and there is a growing movement of urban Serbs and foreigners taking advantage of cheap land and almost abandoned villages that are ripe for renovation. Not to mention the astronomical explosion of real estate investment in the capital, Belgrade, whose population has grown from 1.3 million to nearly two million since 2014.

How much tax do you pay in Serbia?

Serbia uses an interesting personal income tax system, which is set out in a single tax law: all exceptions, rules, and regulations are contained in this single law.

Tax residence and personal income tax

Serbia considers anyone who has their habitual residence or the center of their business and personal life there to be a tax resident. You also become a tax resident if you spend 183 days or more there within a twelve-month period, regardless of whether this is continuous or intermittent.

This means that if your family has a home in, for example, Belgrade, you could be considered a tax resident. The same applies if you have a business there or, of course, if your family lives there.

Serbia taxes individuals on:

• Income from employment (10% is automatically deducted, but health insurance and other taxes increase this amount considerably. The effective tax rate is closer to 45%).
• Income from self-employment (nominally 10%, but a fixed monthly fee of EUR 300-500 applies for income up to EUR 50,000 per year).
• License fees, real estate or industrial capital (20%, declared by the taxpayer).
• Capital gains (15%, declared by the taxpayer).
• Other income (20-15%, different forms of declaration).

Interesting: If you are self-employed and have an income of up to EUR 50,000 per year, you can pay a fixed fee of EUR 300 per month and forget about everything else. Payments are usually made in cash at a local post office.

Corporate tax

Corporate tax in Serbia is a fixed 15% (i.e., it does not vary depending on how much you earn).

Companies only pay tax on profits, but, of course, not all types of expenses can be deducted. Here is a list of those that are not considered deductible:

• Unaccounted expenses
• Reductions in outstanding accounts
• Increases in liabilities
• Gifts or donations to political organizations
• Fees or penalties imposed by the state
• Any expenses “not related to commercial activity”

Avoiding double taxation

Serbia has an extensive network of double taxation agreements (DTAs) with: Albania, Germany, Saudi Arabia, Armenia, Austria, Azerbaijan, Belgium, Belarus, Bosnia and Herzegovina, Bulgaria, Canada, China, Cyprus, Croatia, Denmark, Egypt, United Arab Emirates, Slovakia, Slovenia, Spain, Estonia, Finland, France, Georgia, Greece, Hong Kong, Hungary, India, Indonesia, Iran, Ireland, Israel, Italy, Japan, Kazakhstan, Kuwait, Latvia, Libya, Lithuania, Luxembourg, Macedonia, Malta, Morocco, Moldova, Montenegro, Norway, Netherlands, Pakistan, Poland, United Kingdom, Romania, Russia, San Marino, Singapore, Sri Lanka, Sweden, Switzerland, Tunisia, Turkey, Ukraine, Vietnam.

These usually include clauses on the exchange of tax information and typically only mean that the taxes you pay abroad will be deducted from your Serbian taxes.

Setting up a business in Serbia

As we have seen, companies do not pay much tax in Serbia (15%), but beyond that, it can also be attractive from the point of view of labor costs and the quality of the workforce.

The minimum wage in 2025 is around €618 gross per month for a full-time job (12 monthly payments). This wage level, combined with a relatively low cost of living, makes Serbia an attractive country for employers seeking to optimize costs without sacrificing a skilled workforce.

The overall unemployment rate is around 8.6%, although among young people it rises to around 25%. This means that in sectors where young or recent graduates are needed, there is ample availability.

In addition, many Serbian workers are well educated, especially in engineering, manufacturing, and information technology, a legacy of the Yugoslav education system.

In large cities such as Belgrade and Novi Sad, there is an abundance of young talent with a good level of English, especially in the field of technology. It is relatively easy to find qualified personnel with sufficient language skills to work in international environments.

On the other hand, in rural areas, it can be more difficult to find specialized profiles, although personnel costs there are even lower.

In terms of labor rights, in Serbia, you can dismiss a worker who is no longer needed or who does not perform their duties as desired, but you will have to document the cause and comply with legal deadlines. The system protects employees more than in countries such as the US, but it is much less rigid than in much of Western Europe.

Visa and residence in Serbia

Serbia offers two types of visas: C (short stay) and D (long stay). Both are issued through the E-Visa digital portal.

An interesting form of long-term visa, which could be useful for people who do not have visa-free access to Serbia, is the “digital nomad” visa, for which the applicant must prove that they earn €3,500 or more per month.

Other reasons for applying for a D visa include:

• Investment or employment, including seasonal work
• Education, therapy, and family reunification
• Other (religious service, digital nomads, etc.)

With both types of visas, you can apply for a temporary residence permit and stay legally in the country while your application is being processed.

Serbia is known as a visa destination for those who need to extend their stay in the EU.

Temporary stay in Serbia

For stays of up to 3 years, Serbia offers a digital portal through which both visas and temporary residence permits can be applied for. These permits are issued for various reasons, including:

• Training, studies, research, language or cultural exchange programs
• Medical treatment or family reunification
• Real estate
• Work reasons (self-employment or employment contract)

If the reason for temporary residence is work-related, it is necessary to obtain a single permit, which serves as both a temporary residence permit and a work permit.

The Single Residence and Work Permit

If you wish to carry out an economic activity during a short stay in Serbia, the single permit is an easy way to obtain both a temporary residence permit and a work permit. To obtain the single permit, you use the same digital portal as for the temporary residence permit. The only difference is that you must provide proof that you are carrying out an economic activity (self-employment).

Permanent residence in Serbia

Foreign citizens in Serbia who have resided in the country continuously for three years with a temporary residence permit can obtain a permanent residence permit. In each of those three consecutive years, you cannot be absent for more than ten months in total, and no individual absence can last longer than six months.

Notwithstanding the above, a permanent residence permit will be granted to minors whose legal guardians are Serbian citizens or persons with permanent residence in the country, as well as to foreigners who can prove that they are of Serbian origin. There is a fourth possibility, namely the granting of a permanent residence permit to foreigners whose stay in Serbia is considered to be in the national interest.

Ways to acquire Serbian citizenship

There are four possibilities regulated by law for foreigners to obtain Serbian citizenship.

Citizenship by descent

If one of your parents had Serbian citizenship at the time of your birth or if you were adopted by a Serbian citizen before you turned 18, you are entitled to citizenship by descent.

You are entitled to an indefinite residence permit if you can prove that you are of Serbian descent. However, if you cannot prove your parents’ Serbian citizenship, the Ministry of the Interior will treat these cases on an individual basis. For people of Sorbian origin in Germany, this could be a practical way to start this process.

Citizenship by birth

A person born in Serbia is considered a Serbian citizen if both parents are stateless or their nationality is unknown (and, of course, if either parent is Serbian). If, before the child turns 18, it is determined that both parents have foreign nationality, that nationality will be withdrawn. This withdrawal requires the consent of the child if they are over 14 years of age.

International agreements

In certain countries, such as Montenegro, Bosnia, and other former Yugoslav states with a significant Serbian minority, there is the possibility for their citizens to obtain Serbian citizenship.

Serbian citizenship by naturalization

Foreigners can become naturalized as Serbian citizens, for which they must cumulatively meet the following requirements:

• Be over 18 years of age.
• Prove that you have renounced your citizenship or
• Prove that you will automatically lose your citizenship upon obtaining Serbian citizenship.
• Have permanent residence in Serbia for 3 years.
• Submit a written statement indicating that Serbia is your only country of origin.

Other ways to acquire Serbian citizenship

In addition, Serbia grants citizenship on an exceptional basis to athletes, artists, personalities, or other persons of national interest. Among the best-known beneficiaries of this citizenship are, for example, actors Ralph Fiennes and Steven Seagal.

International policy and agreements

Serbia is in Europe, but it has a different status and position than most European countries, which makes it a very interesting option for those who want to continue living in Europe and enjoying a European quality of life, but without all the disadvantages of the old continent.

The Serbian government practices what is called the “three-legged stool”: on the one hand, it tries to maintain ties with the EU (for trade and funds). On the other hand, it seeks to retain Russia’s support. And finally, it seeks to strengthen its alliance with China (investment and infrastructure).

Serbia and the Russia-Ukraine issue

Serbia’s relationship with Russia has historically been very close, based on both cultural affinities (Slavic people and Orthodox religion) and political ties. Unlike the European Union, Serbia has not imposed sanctions on Moscow following the invasion of Ukraine. In addition, it receives Russian gas on preferential terms and maintains active military cooperation. However, Belgrade is trying not to become completely caught up in the Kremlin’s orbit and is seeking a certain degree of autonomy in its foreign policy.

A large number of Russian citizens have arrived in Belgrade and are welcome there. The same is true of Ukrainians who, although fewer in number, have also chosen Belgrade as their destination in the last two years of instability between these two countries.

According to estimates by the Belgrade police, between 2022 and 2024 more than 100,000 Russians and Ukrainians will have stayed in the city for more than three months.

Serbia’s relationship with China and the United States

China has become a key partner for Serbia in terms of investment and infrastructure, with projects covering roads, railways, and mines. The country is actively participating in the Belt and Road Initiative, and Belgrade has also purchased Chinese military equipment. In its domestic discourse, the Serbian government presents China as a “reliable friend,” especially since the COVID pandemic, when it was one of the first countries to send vaccines and aid.

As for the United States, the relationship is more complicated due to the Kosovo issue. Washington has exerted strong pressure on Serbia to recognize Kosovar independence, something that Belgrade categorically rejects. Despite this, the United States maintains a strategic dialogue with Serbia, mainly in the interests of ensuring stability in the Balkans.

The gray area of international agreements

As a non-EU country, Serbia is often used to obtain visas and extended stays outside the EU. This role has been further expanded as Serbia realized that it was better to delay its accession to various international treaties and organizations. Although Serbia is supposedly on track to join the EU, the delay in this process and the maintenance of its activity as a less regulated island have yielded great results for Serbia.

Serbia is in a semi-permanent state of “pending review” when it comes to compliance with OECD tax agreements: for example, Serbia has not signed the OECD’s Multilateral Competent Authority Agreement (MCAA) for the implementation of automatic exchange of information (AEOI) nor has it set a date for its possible signing.

This means that although Serbia has acceded to the OECD Convention on Mutual Administrative Assistance in Tax Matters and the OECD Convention to Prevent Tax Avoidance and Profit Shifting, there is no technical agreement on the exchange of information. In practice, this means that tax information is generally not exchanged, which has aroused great interest among people who are jealous of their “economic privacy” throughout Europe.

Other agreements

However, Serbia has been a signatory to FATCA since 2014, which means that Americans cannot benefit as much from this transitional regime.

It is interesting to note that Serbia’s network of social security agreements covers most of Europe. In some of these bilateral relationships, it makes more sense to collect social security contributions in Serbia, as these contributions are tax-exempt in Serbia. This can be useful for Europeans looking for a lesser-known retirement destination.

In conclusion

Serbia is a unique country within Europe. It does not belong to the European Union or the Schengen area, but it is sufficiently integrated into the continent to offer a European quality of life without the restrictions, taxes, and bureaucracy of the “old club.” Its low cost of living, relatively simple and competitive tax system, the possibility of settling with accessible visas, and the flexibility of its labor market make it an attractive option both for those seeking a haven of freedom and for investors and entrepreneurs who want to diversify their flags.

In addition, Serbia maintains a geopolitical balance that allows it to play several cards: trade with the EU, cheap energy from Russia, and large investments from China. This mix of East and West is reflected not only in its international politics, but also in its culture, cuisine, and daily life in its cities. Vibrant and expanding Belgrade is combined with a rural interior full of opportunities for those seeking land, nature, and a simpler life.

For those who want to live in Europe without being subject to the total control of Brussels, Serbia offers an interesting framework of freedom: low taxation, opportunities for residency and citizenship, and an environment where it is still possible to live with more personal autonomy.

If you are looking for a quiet place to retire, where your family and domestic life can proceed undisturbed, the Serbian countryside offers a wide selection of properties, while international tax agreements ensure that most of your foreign income remains in your hands.

For those seeking a more dynamic lifestyle, Belgrade is a booming European city that has much to offer, is relatively affordable, and yet is well connected.

If you want to make Serbia your next destination or plant a flag there, contact us.