Flat-rate taxpayer (Sole Proprietorship) - registration and taxes

What is a Paushalac?

Paushalac (paušalno oporezivanje) is a simplified taxation system for individual entrepreneurs (preduzetnik) in Serbia. It is the most popular option among IT specialists and freelancers: taxes and mandatory contributions are calculated from a fixed base approved by the tax authority, rather than from actual income.

Benefits

• Fixed payments, not dependent on how much you actually earned (within the limit).
• Accounting - no professional accountant is required, KPO book can be kept independently.
• Registration takes 2-3 working days.
• Obtaining paushal status serves as a basis for temporary residence permit (boravak) for work/business.

Limits: 6 million and 8 million RSD

• 6,000,000 RSD per calendar year - the limit of the paushal regime itself. If exceeded, you will have to switch to regular accounting (knjigaš) in the next year.
• 8,000,000 RSD for any 12 consecutive months - the threshold for mandatory registration in the VAT (PDV) system. No VAT is required to be paid up to this level.

How much to pay (2026)

The payment consists of four fixed components: income tax 10% + pension (PIO) 25.5% + healthcare 10.3% + unemployment contribution 0.75% ≈ 46.55% of the calculated base.

For IT codes 6201 and 6202, the calculated base is set at the national level, without differences by cities. Estimated amounts (Belgrade, 2026, per month):

Code	Name	Calculated base (RSD)
6201	Computer programming	48,000
6202	IT consulting	48,000
6209	Other IT services	32,000
6312	Web portals	32,000
7022	Business consulting	33,000
7410	Design	32,000
7430	Translators	57,000
9003	Artists/writers	40,000

For new paushalacs, a reducing coefficient of 0.5 applies, which can increase by a maximum of 10% annually. It is already included in the specified amounts; separate "50% discounts" are a myth. Always check the exact figure in the official tax calculator: eporezi.purs.gov.rs (in January, the service is not available due to rate updates).

Test of independence (important for IT and freelancers)

Since March 2020, the Poreska uprava has been operating a "test of independence" (test samostalnosti). It consists of 9 criteria that check whether a paushalac is not a hidden employee of one client. If 5 or more criteria are met, income from this client is considered "other income" and taxed at a rate of 20% + 25.5% PIO contributions - significantly more expensive than the paushal regime. The test is conducted only within a tax audit; it is not required to pass it when opening an individual entrepreneurship.

Registration - step by step

1. Choose an activity code. For IT, usually 6201 (programming) or 6202 (IT consulting). There can be only one code, so carefully study the official description.
2. Register with APR (Agencija za privredne registre). The fee is around 2,500 RSD; it can be formalized online (e-signature/ConsentID required) or in person.
3. Obtain rešenje - within 2-3 working days.
4. Open a business account in a Serbian bank (a bank account is mandatory by law).
5. Apply for paushal in Poreska uprava; after approval, you receive rešenje o rasčatnoj bazi.
6. Register with PIO - pension fund (only after obtaining temporary residence permit, foreigner's ID number required).

Who is not suitable for paushal

According to Article 40 of the Law on Income Tax, the paushal regime is prohibited for: trade (wholesale/retail), catering and hotels, financial intermediation and insurance, advertising and market research, real estate transactions, audit/accounting, as well as any activity requiring a license. Income from advertising (website, YouTube, Twitch) refers to code 7311 and does not fall under paushal.

Alternatives to paushal

• Knjigaš with salary - taxes around 20%; suitable for non-paushal code, limit exceeded, or high margin.
• Knjigaš without salary - taxes around 46% of all profit; beneficial for low margin and large deductible expenses.
• DOO - for two or more co-founders working with common clients (see separate article).
• Freelancer (samozaposleni) - a special tax regime for those who already have a temporary residence permit on a different basis; it is not possible to obtain a temporary residence permit under this regime.

Monthly obligations

• Payment of taxes and contributions - by the 15th of the previous month.
• Issuance of invoices (bills) to clients and maintenance of KPO book (KPO).
• Eco-tax (ekološka taksa) - for small businesses, the minimum rate is approximately 5,000 RSD per year.

Important: if your income changes or you switch to a different tax regime, update your calculated base in Poreska uprava in a timely manner.