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More than 300,000 Serbian citizens who, according to the latest census, are working abroad, could expect additional costs, if the Tax Administration decides to strictly implement the current Law on Personal Income Tax. That is, Article 7 of this Law prescribes that the taxpayer of income tax is a resident of Serbia, both for income earned on the territory of the Republic of Serbia and for income in another country. Ultimately, the new union earns more than 400 euros for every 1,000 euros, but this amount can be even less.
Therefore, all citizens of Serbia classified as “residents” are required to pay taxes and contributions, regardless of whether they have earned their salary abroad.
Serbian law practically obliges to pay taxes and contributions for PIO, as well as the health fund. There is the option of going cheaper at the same time. If the tax on your salary was paid in another country, you may be exempt from the tax in Serbia, but there are two conditions for this.
The first is that Serbia has an agreement with that country to avoid double taxation, and the second is that you have proof that the tax on your salary has already been paid abroad. For example, if your employer paid 50 euros in taxes in another country, and Serbia demands 85.9 euros from you, you pay the difference (35.9 euros) to Serbia.
“Tax exemption is not mentioned in contribution law and tax law. Therefore, the fact that you have paid your pension insurance to a foreign fund does not necessarily release you from your obligations to Serbia. you still have to pay a contribution to the Serbian Pension and Disability Insurance Fund. As a tax resident, wherever you are and wherever you work, Serbia can demand contributions from you. You don’t have to pay the tax only if a higher tax is paid in the abroad than in Serbia, but you have to contribute, “says the Serbian Association of Self-Employed and Entrepreneurs.
The tax is 10% of the tax base and the contribution to the PIO and the health fund is 25.5%, that is, 10.3% of the total salary.
Most guest workers in Austria and Germany
According to the latest official census, 313,411 citizens of Serbia work or stay abroad, representing 4.2 percent of the total population. The figures also confirm that the majority of young people leave Serbia.
“The average age of external migrants is 34.7 years, which makes them much younger than the total population of Serbia, which averages 42.2 years. Observed by gender, in contrast to the total population, where women are more represented (51.3 percent), the proportion of men is higher among external migrants (53.4 percent), while the proportion of women is 46.6 percent “- data from the Office of Statistics of the Republic (SORS).
By the way, just over half of guest workers work or live in Austria (22.5 percent), Germany (17.9 percent) and Switzerland (13.1 percent).
As for the total number of our people abroad, in Europe, the majority of Serbs are in Germany: 450,000, followed by Austria (300,000) and Switzerland (almost 200,000). Interestingly, 80,000 Serbs live in the UK, which is known for its strict procedures even with regard to tourist visas.
There are large numbers of Serbs living in both Asia and Oceania – 120,000, most of whom are in Australia.
Who pays taxes
And the definition given in the law says that a resident is “a natural person who has a residence or business center and life interests in the territory of the Republic of Serbia, or in the territory of Serbia, continuously or intermittently, stays for 183 or more days ends in the corresponding fiscal year. ” Or you went to work temporarily in a European Union country for 90 days, returned to Serbia and then went back to work.
In short, you need to meet only one of the above criteria to be treated by law as a tax-paying resident in Serbia.
Even if you moved to Austria or Germany ten years ago and worked there all the time, earned income and paid taxes, if you have not canceled your residence in Serbia, additional obligations await you, according to the regulations currently in force. The same is true if you occasionally went to work in a country in the European Union.
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