New Taxation Model For Freelancers And Increase Of Non-taxable Salary

• Law Firm: Eurofast
• Subject Matter: Tax, Income Tax
• Author: Ivana Zivic
• Published date: 23 February 2023

The new year brought several changes in the set of tax laws in the Republic of Serbia. Significant changes on personal income tax and mandatory social security contributions were announced. New parameters for taxation of wages and other personal income, including a new model of taxation, the so-called freelancers, are applicable as of January 1, 2023 with the amendements being the following:

Law on Amendments to the Personal Income Tax

• Non-taxable salary amount is increasedfrom 19.300RSDto 21.712 RSD
• Minimum net wage in 2023 will be 230 RSD per working hour whereas new minimum labor price is increased by 14.3% compared to the previous one.

Law on Contributions for Compulsory Social Insurance

• Decreasing of theemployer'scontribution rate for pension insurancefor 1%;the total contribution rate for pension insurance will now be 24% instead of 25%.

Law on Taxation of freelancers

This year, freelancers will have the opportunity to choose one of the two possible taxation models they want to be taxed by. Taxation will be done quarterly and freelancers will be able to change model of taxation. The decision to apply one model in one quarter will not condition them to apply the same model of taxation in the following quarters.

• Model A

According to model A, the non-taxable amount per month will be 32,000 dinars (96,000 dinars quarterly) with a tax rate of 20%. Base for contributions will be the same as the base for paying taxes and the minimum amount for paying contributions will be 1,402...