Serbia is increasingly positioning itself as a regional hub for startups and digital entrepreneurs. The combination of a favorable tax system, a growing tech community, relatively low costs, and a geographically advantageous location attracts founders from around the world. For foreign nationals who plan to establish and grow their companies here, regularizing their residence status stands as one of the first — and most important — legal steps.
This text is informational in nature and does not substitute individual legal advice.
Temporary Residence as a Basis for Startup Founders
The Law on Foreigners (“Official Gazette of the RS”, Nos. 24/2018, 31/2019, and 62/2023) provides for temporary residence as a form of regularizing a foreigner’s status. Under the amendments to the Law that have been in effect since February 2024, temporary residence may be granted for a period of up to three years, with the possibility of extension; subsequent amendments to the Law on Foreigners and the Law on Employment of Foreigners from 2024 also introduced a unified permit for temporary residence and work. The grounds for granting temporary residence are precisely set out in the Law, and the most relevant ones for startup founders are:
- Temporary residence for the purpose of conducting business activity — for founders who establish or manage a commercial entity in Serbia
- Temporary residence for the purpose of employment — where the founder simultaneously establishes an employment relationship with a Serbian company (as a director under an employment contract)
- Temporary residence for the purpose of investment — depending on the structure of the engagement
Selecting the correct basis for residence is a key decision that directly affects the accompanying obligations and rights of the applicant.
The SOHO Program — What It Is and Who It Is Intended For
SOHO (Small Office / Home Office) is a term informally used for entrepreneurs and founders who operate independently, primarily digitally, without traditional business infrastructure. In the context of the Serbian legal system, this is not a separate statutory category but a descriptive term encompassing several legal forms.
The Serbian Development Agency (RAS — Razvojna agencija Srbije) and the relevant ministries periodically develop or support startup ecosystem programs that may include a streamlined procedure for foreign founders. Accurate and up-to-date information on specialized support programs is published by the RAS, as the specifics of these programs and the availability of conditions change periodically.
Establishing a Commercial Entity as the Basis for Residence
The most common route for foreign startup founders is to establish a limited liability company (DOO — društvo sa ograničenom odgovornošću) in Serbia and subsequently apply for temporary residence on the basis of that business engagement.
The process proceeds in two steps:
Step 1 — Establishing the company Registration of a DOO with the Business Registers Agency (BRA — Agencija za privredne registre, APR) is available to foreign nationals as well. The minimum share capital is nominal (100 Serbian dinars). The required documents are: a decision on incorporation or articles of association, a registration application, proof of capital payment, information about the founders and appointed persons, and proof of registered office. With complete documentation, the BRA process takes anywhere from a few days to a week.
Step 2 — Applying for temporary residence After the company has been incorporated, the founder applies for temporary residence for the purpose of conducting business activity with the competent organizational unit of the Ministry of Internal Affairs (MIA — Ministarstvo unutrašnjih poslova, MUP), submitting proof of incorporation and management of the company, a passport, proof of accommodation, proof of means of subsistence, and other prescribed documentation.
Documentation and Practical Requirements
Standard documentation for temporary residence for the purpose of conducting business activity includes:
- Valid travel document
- Extract from the BRA regarding the incorporated company (not older than 3 months)
- Decision on appointment as director (where the founder is also the director)
- Proof of accommodation in Serbia (lease agreement or confirmation from the property owner)
- Proof of financial means (bank statements, income certificates)
- Certificate of no criminal record from the country of origin (certified and apostilled)
- Health insurance
- Proof of payment of administrative fees
Documents issued abroad must be translated by a court-certified interpreter and certified by apostille or through consular legalization, depending on the country of origin.
Duration, Renewal, and the Path to Permanent Residence
Temporary residence is, under the applicable provisions of the Law on Foreigners, granted for a period of up to three years. It may be extended on the basis of continued business engagement in Serbia. Each extension requires a new application and updated documentation, including proof that the company continues to operate actively.
After three years of continuous lawful residence, the founder meets the basic eligibility requirement to apply for permanent residence, which confers a significantly broader scope of rights — including the right to work without being tied to a specific employer and de facto equal treatment with domestic citizens in most areas.
For founders who have family members who are Serbian citizens through marital or family ties, shorter paths to permanent residence may also be available.
Advantages of Serbia for Foreign Startup Founders
In addition to the relatively accessible procedure for regularizing residence, Serbia offers a number of concrete advantages for foreign entrepreneurs:
- Favorable tax environment: A corporate income tax rate of 15% is among the lower rates in the region; specific tax incentives are also available for innovative startups
- IT tax incentives: Special tax treatment of income for IT companies and their employees (IP Box regime) attracts tech founders
- Growing tech community: Belgrade in particular has an active startup scene, incubators, and accelerators
- Geographic position: Visa-free regimes or favorable entry conditions for many nationalities; center of the Balkans
- Affordable costs: Office space, labor, and living costs are lower than in Western Europe
Frequently Asked Questions (Q&A)
Can a foreigner be the sole founder and director of a Serbian DOO? Yes. Serbian law does not require that the founder or director of a commercial entity be a domestic citizen. A foreigner may be the sole owner and sole legal representative of a DOO.
When should one apply for temporary residence — before or after incorporating the company? As a general rule, the most practical sequence is: first incorporate the company (which does not require a regulated residence status in Serbia and can be done during a temporary visit), then apply for temporary residence on the basis of the company’s documentation. Certain categories of foreigners may also submit the application through the consulate in their home country — this depends on the applicant’s citizenship.
Does the founder’s temporary residence automatically apply to family members as well? Not automatically. Family companions (spouse, minor children) must apply separately for temporary residence for the purpose of family reunification, on the basis of the founder’s status.
What happens if the company ceases to operate? Temporary residence for the purpose of conducting business activity is tied to active business engagement. Cessation of activity or dissolution of the company may constitute grounds for termination of the residence permit. The founder should arrange an alternative basis for residence in a timely manner or depart the territory of Serbia.
Conclusion
Serbia offers a real and accessible legal route for foreign startup founders who wish to build their companies here. The combination of incorporating a DOO and obtaining temporary residence for the purpose of business activity is a proven solution — but it requires thorough preparation of documentation and an understanding of the statutory deadlines.
Schedule a consultation with the VertexLaw team and learn the exact course of action for your specific case — from incorporating the company to regularizing your residence status and long-term tax planning.
Sources: – https://www.mup.gov.rs/wps/portal/sr/gradjani/stranci/Privremeni+boravak/ – https://ras.gov.rs/sr/investicije/podrska-startapima – https://www.paragraf.rs/propisi/zakon_o_strancima.html
