How to set up a company in Serbia?

The first thing you need to do is register the company in the Serbian Business Registry Agency (APR), but before you register the company you must decide on its name, code of predominant activity, founding act and address (which can be virtual office).

Below we present the steps that await you when forming a company in Serbia, in which you can be significantly helped by a professional and reliable domestic accounting firm, which knows the legal and tax regulations, and therefore can contribute to the optimization of your business.

Selection of legal form of economic entity

The Law on Business Entities of the Republic of Serbia recognizes several forms of organization of legal entities, ie several forms of legal entities. Those are:

Entrepreneur

Entrepreneur is a natural person, who can be employed or unemployed, and who is registered in the APR in order to perform income-generating activities.

Limited Liability Company (LLC)

A LLC may have one or more founders, all of whom have a share in the share capital of the company. The minimum amount of initial capital is 100 dinars.

Partnerships

The partnership is founded by the so-called "Partners", two or more, which may be natural or legal persons, in order to perform activities under one name. Initial assets may consist of tangible and intangible assets.

Limited partnership

This type of legal form is established by at least two persons - a general partner and a joint venturer in order to perform activities under one name, for the purpose of making a profit. The general partner is liable for the company's obligations unlimitedly, with the entire property, and the limited partner only with his share.

Stock company

A joint stock company is a legal entity whose share capital consists of shares. It consists of shareholders, who own the shares, and who have the right to payments and decisions based on them.

Other legal forms are:

A branch of a domestic legal entity is a separate part of a company in one or more places on the territory of the RS, where the activity is performed in order to generate income.

A branch of a foreign legal entity is a separate organization, a part of a foreign company through which it performs activities in the Republic of Serbia, in accordance with the Law. It has a registered predominant activity, but it can also perform other activities that are not prohibited by law.

The representative office of a foreign legal entity is a separate organizational part of a foreign company in Serbia. The representative office cannot place or sell goods, nor provide services, it can only conclude deals related to their current business.

What is needed to establish a company in Serbia?

The documentation for company formation in Serbia differs depending on the legal form of the entity, but generally begins with the submission of a registration application in the APR. APR makes a decision within five days - approves or rejects the application, if it is not well completed.

However, before the same registration, it is necessary to make some more decisions, and these are:

Select a company name

The business name of the company must contain the name of the company, the legal form of the company and the place where the registered office of the company is registered. Choose the name of the company in accordance with the Law, and check on the APR website whether the desired name is available and book it in advance.

Selection of code of activity

The activity code refers to the predominant activity that the company will engage in in order to make a profit. In addition to the predominant activity, the company has the right to engage in other, secondary activities, but if those activities become dominant (predominant), it will be necessary to change the activity code. The activity code is also important because of the records of turnover through the fiscal cash register, because some activities are exempt from this obligation.

Preparation of the Founding Act

If you are registering a limited liability company, you will have to prepare a Memorandum of Association, a legal document that regulates all aspects of business. Depending on the number of members of the LLC, a Founding Act is created in accordance with the number of shareholders. For a one-member company, the Founding Act is the Founding Decision, and for a multi-member LLC, the Founding Act is the Founding Agreement.

Company address or virtual office

The company can have a physical headquarters, for which it rents business premises, and if it wants to avoid that type of costs, it can rent a virtual office. The virtual office is the place of registration of the company's headquarters, but also the place of receiving mail, telephone calls, administrative support, etc. If the business is not strictly related to your specific location, a virtual office is a flexible and economical concept that is compatible with the modern way of doing business.

The process of company formation in Serbia

The registration of a company can be done electronically, whether it is an entrepreneur or a limited liability company. The applicant must have an electronic signature, an installed electronic card reader and an installed application for electronic signing.

For the registration of entrepreneurs it is necessary to submit the following documents:

• completed registration application for founding an entrepreneur
• verified photocopy of the entrepreneur's ID card
• proof of paid fee or fee for the establishment of an entrepreneur
• consent of the relevant authorities to perform the activity.

As we mentioned, the establishment of a LLC is more complicated, and the required documentation is as follows:

• single registration application for the formation of company and entry in the register of taxpayers signed by the legal representative of a legal entity or an authorized person
• proof of identity of members of the company - photocopy of ID card for domestic citizens, photocopy of passport if foreign citizen; if the founder is a legal entity, an excerpt from the Register, in which that legal entity was previously registered, shall be attached,
• founding act of the LLC, with certified signatures of all founders, ie members of the company,
• decision on the appointment of a representative, if he is not determined by the founding act,
• certified signature of the representative,
• confirmation from the bank on the payment of the cash deposit as proof of payment of the establishment fee
• agreement of the members on the assessment of the value of the non-monetary contribution, if any
• proof of payment of the fee for registration of the establishment of the LLC and proof of payment of the fee for registration and publication of the founding act.

After setting up a company and the obtained Decision on registration, the company can make a seal, although its use from 2017 is not mandatory. The firm also needs to open an account in the selected bank and file a tax return, in order to be registered as a new taxpayer. The deadline for submitting the tax return is 15 days from the day of receiving the Decision on registration from the APR. Also, the company should have an electronic signature which is used for signing and verification of documents electronically, and which the citizens of Serbia can get in the competent police administration.

The company should make a decision, depending on the amount of expected turnover, whether it wants to enter the VAT system. If a turnover of more than 8,000,000 per year is expected, the firm must pay value added tax.

Last but not least, the company should choose a bookkeeping company or accounting firm that will, as a reliable associate, take care of all its needs, know how to recognize them and propose adequate solutions in a timely manner that will assist with proper financial and tax handling.

(Telegraf.rs/PR)