How To Compliantly Hire Contractors In Serbia

Over 100,000 workers in Serbia make their living as freelancers, and many of these contractors have created successful businesses offering IT services to overseas clients. If you’re looking to hire contractors to support your business, Serbia is a great place to source talent.

Serbian laws regulating independent contractor engagements have not been updated since their 2005 Labor Law was passed. But recent freelancer protests, as well as legislative and legal attention surrounding “re-characterisation” (aka “reclassification”) of independent workers is on the rise and attracting national attention.

In 2021, several thousand freelancers and IT workers staged a protest in Belgrade over high tax rates and retroactive demands for debt payments that can potentially send freelancers to prison for 10 years if they fail to pay.

The Serbian government began negotiating a solution, but talks later stalled—so taxation still remains a pressing issue for the thousands of freelance workers in this country.

The number of independent contractors is increasing in Serbia – and despite the general unrest, there’s one tax related perk that is, in part, driving this growth. This is the option for independent contractors to pay taxes via a “lump-sum” model, which is often less than employee income taxation amounts. 

With the current uncertainty around tax legislation for independent contractors, it’s more important than ever that companies looking to hire Serbian freelancers carry out due diligence before hiring, and keep an eye on developments and legislative changes that could have an impact on compliance.

A platform like Worksuite can ensure that you’re always up to date with current tax and legal requirements when you’re hiring freelancers in Serbia.

Worksuite’s Global Shield protects your business when you’re hiring Serbian freelance talent in today’s and tomorrow’s regulatory environment, ensuring you’re never at risk of fines and penalties from non-compliance.

Our custom onboarding workflows and screening questionnaires will help you determine each freelancer’s status in compliance with Serbian law. 

You can then decide to engage each worker as either a contractor or full-time worker—all without needing to set up your business entity in Serbia.

We also partner with the best legal teams in Serbia to create contract templates that are compliant with local laws. This protects you and your contractors from fines and penalties, and gives you peace of mind when you’re growing your talent pool in this country.