Salaries in Serbia

In order to deal with the topic of salaries in Serbia, it is necessary to state the source of that information in advance. The text that follows is not the subject of our subjective assessment but represents information on salaries in Serbia that was collected and processed by the Statistical Office of the Republic of Serbia.

The Statistical Office of the Republic of Serbia is a state body of the Republic of Serbia that performs professional tasks related to the adoption of programs, organization and implementation of statistical surveys, ie the development of methodology, collection, processing, statistical analysis and publication of statistical data; preparation and adoption of uniform statistical standards; development, maintenance and use of republic administrative and statistical registers; formation and maintenance of a system of national accounts; cooperation and professional coordination with bodies and organizations authorized to conduct statistical surveys; cooperation with international organizations for the purpose of standardization and ensuring comparability of data, as well as other tasks determined by law.

Average salary in Serbia

According to the Statistical Office of the Republic of Serbia, the average gross salary calculated for September 2020 amounted to 82,515 dinars, while the average salary without taxes and contributions (net salary) amounted to 59,698 dinars.

The median net salary for September 2020 amounted to 45,817 dinars, which means that 50% of employees earned up to the stated amount.

The average salary in Serbia in September 2020 are presented in Serbian currency (in dinars) in the following tables:

	Salaries			Salaries without taxes and contributions
	IX 2020	I–IX  2020	III quarter	IX  2020	I–IX  2020	III quarter
In total	82515	81936	82143	59698	59286	59412
Earnings of employees	82948	82332	82564	60029	59590	59735
Earnings of employees outside employment	53607	54057	53517	37572	37887	37509
Salaries of employees in legal entities	88041	87148	87601	63781	63162	63456
Earnings of entrepreneurs and their employees	44713	45030	44981	31760	31841	31879
Public sector	94197	93744	93880	67658	67345	67433
Outside the public sector	77456	76724	77064	56250	55729	55942

	Salaries				Salaries without taxes and contributions
	Dinars		Nominal index		Dinars		Nominal index
	IX 2020	I-IX 2020	IX 2020	I-IX 2020	IX 2020	I-IX 2020	IX 2020	I-IX 2020
			VIII 2020	I-IX 2019			VIII 2020	I-IX 2019
In total	82515	81936	102	109.5	59698	59286	102	109.4
Earnings of employees	82948	82332	102	109.4	60029	59590	102	109.3
Earnings of employees outside employment	53607	54057	102.5	108.1	37572	37887	102.5	108.1
Salaries of employees in legal entities	88041	87148	102	109.6	63781	63162	102	109.6
Earnings of entrepreneurs and their employees	44713	45030	100.9	111.7	31760	31841	101.2	111.1
Public sector	94197	93744	101.8	111.3	67658	67345	101.8	111.2
Outside the public sector	77456	76724	102.1	108.9	56250	55729	102.1	108.8

To calculate the salaries in Euro, just divide the amounts in dinars with 118.

Minimum wage

The minimum wage of labor is an economic category and its determination is based on the parameters provided by the Labor Law:

• employment rate in the labor market;
• growth rate of gross domestic product;
• movement of consumer prices;
• productivity trends and average wage trends in the Republic;
• existential and social needs of the employee and his family expressed through the value of the minimum consumer basket.

The minimum wage of labor is determined by the decision of the Social and Economic Council of the Republic of Serbia.

The minimum wage amounts about 260 EUR net, or 400 EUR gross (total cost).

Salaries in Serbia from the angle of income tax

The thing that probably interests employers and employees the most is the taxation of salaries in Serbia. In accordance with the Law on personal income tax, the object of taxation is:

• salary earned on the basis of labor relations, defined by the Labor Law,
• agreed compensation and other income earned by performing temporary and periodical jobs,
• paid personal salary of the entrepreneur,
• employee income earned by working with a domestic employer and paid by the party who is considered to be related to the employer
• employee benefits such as income.

Income benefits are:

• vouchers;
• securities, except for shares acquired in the process of ownership transformation;
• cash receipts;
• goods;
• achieved by making or providing benefits, debt forgiveness, as well as covering the taxpayer’s expenses with monetary compensation or direct payment.

Such other benefits are:

• usage of a business vehicle and other means of transport for private purposes;
• usage of residential buildings and apartments that are owned by the employer or at the disposal of the employer on the basis of the lease or other basis;
• premiums for certain types of voluntary insurance, as well as pension contributions to the voluntary pension fund, which the employer pays for employees

Salaries in the sense of the Labor Law are considered to be one that includes taxes and contributions paid from salaries (gross I). The payroll tax rate is 10% of gross 1 salary.

Salaries in Serbia from the angle of social contributions

In addition to taxes in Serbia, there is a legal obligation to calculate and pay contributions for mandatory social and health insurance.

In Serbia, the following types of contributions are mandatory:

• for mandatory pension and disability insurance – 25.5%;
• for mandatory health insurance – 10.3%;
• for unemployment insurance – 0.75%.

The legal nature of salary in relation to other income

Salary is the wage that comes from an employment contract.

Other incomes according to the Law on Personal Income Tax represent incomes that do not originate from employment. This type of income is most often realized through a work contract, which is also a manager engagement agreement.

The difference between salary and other income is reflected in the different tax rates for such income. Salary is taxed at a rate of 10% while other income is taxed at a rate of 20%.

Another income that is taxed at a rate of 20% is the income of freelancers.

In this regard, it should be noted that there is no obligation to pay health insurance if the employee, on the basis of another employment relationship, already pays health insurance.

Salaries in Serbia as one of the reasons for investing in Serbia

If you are thinking of investing in a business in Serbia, you can see our text about it. One of the reasons why investors decide to invest in Serbia is salaries in Serbia.

Compared to other European countries, salaries in Serbia are among the lowest.

Compared to other Balkan countries, salaries in Serbia are in the middle of the scale.

The following table lists Central European, Eastern and South-East European countries with average net salaries:

Country	Net salary
Austria	2885
Slovenia	1175
Greece	1116
Croatia	910
Czech Republic	900
Poland	860
Slovakia	831
Hungary	755
Romania	682
Bulgaria	554
Montenegro	527
Serbia	507
Bosnia and Herzegovina	492
Northern Macedonia	436
Albania	356
Moldova	316
Ukraine	288

Salaries and remote work

Remote work (work out of the office) is specially regulated by Labor Law. Calculation of salaries and all above mentioned is the applicable to remote workers. In the case of remote work employers prefer to use special software solutions and  tools for time tracking software for remote workers in order to calculate working time as basis for the salary calculation.

If you have an additional question related to this topic, feel free to contact us. Also, we recommend that you read our text 30 Reasons to invest in Serbia and Bookkeeping services in Serbia.

Our team of tax experts is at your disposal for all questions.