Serbian Freelance Tax Optimization Guide (Model A vs Model B)
Freelancing in Serbia is regulated under a quarterly self-assessment regime. Freelancers must file their tax returns (PP OPO-K form) within 30 days of the end of each quarter (Q1: April 30, Q2: July 30, Q3: October 30, Q4: January 30). You can choose between two different calculation models to minimize your tax liability depending on your actual quarterly earnings. To calculate your target hourly rate including these tax obligations, you can use our Hourly Rate Calculator. Calculating these values correctly ensures you avoid heavy penalties while legally keeping your tax burden to a minimum.
Model A (Optimal for Lower Revenues)
Model A offers a generous flat tax-free deduction of 96,000 RSD per quarter. The remaining taxable base is taxed at 20%. Additionally, you pay 24% for pension insurance (PIO). If you are not employed elsewhere, a minimum health insurance contribution of approximately 4,800 RSD per quarter applies. If you earn less than 96,000 RSD in a quarter, your tax liability is practically zero except for the mandatory health insurance contribution if you are otherwise unemployed.
Model B (Optimal for Higher Revenues)
Model B includes a smaller flat deduction of 57,900 RSD, but allows you to deduct 34% of your total quarterly revenue as normalized business costs (normirani troškovi). The tax rate on the remaining base is only 10%, with 24% for PIO and 10.3% for health insurance. This structure is highly beneficial for freelancers earning over 200,000 RSD per quarter. As your income scales, the 34% normalized cost deduction significantly reduces your taxable base compared to the fixed deduction of Model A.
Choosing Pausalac (Sole Proprietor) vs. Freelancer Self-Assessment
While the self-assessment models (Model A and B) are ideal for part-time freelancers or those with irregular income, high-earning professionals might consider registering as a sole proprietor (Preduzetnik Paušalac). Pausalac features flat-rate monthly taxes regardless of revenue up to 6 million RSD annually, but comes with rigid monthly payments and a strict test of independence (test samostalnosti). For flexible, low-overhead freelance operations, self-assessment remains the simplest route. You can also estimate your take-home cash using our Net Income Calculator to compare against other tax regimes.