Payroll in Serbia 2026: Tax-Free Amount, Minimum Wage, Gross-to-Net
Payroll calculation in Serbia for 2026 rests on a handful of numbers every employer needs to know: the tax-free salary amount of RSD 34,221 per month, the minimum net hourly wage of RSD 371, employee contributions of 19.90%, employer contributions of 15.15%, and salary tax of 10%. The short answer to the most common question: for a net salary of RSD 100,000, gross is RSD 137,771.61 and the total employer cost is RSD 158,644.01. Below we show the formula, work through the example step by step and give a table for the minimum wage.
Payroll parameters for 2026
| Parameter | Value in 2026 |
|---|---|
| Tax-free salary amount | RSD 34,221 per month |
| Salary tax | 10% on (gross minus 34,221) |
| Employee contributions | 19.90% (pension 14%, health 5.15%, unemployment 0.75%) |
| Employer contributions | 15.15% (pension 10%, health 5.15%) |
| Minimum net hourly wage | RSD 371 per working hour |
| Lowest monthly contribution base | RSD 51,297 |
| Highest monthly contribution base | RSD 732,820 |
The tax-free amount and contribution bases are adjusted once a year and apply to payments from January 1 to December 31, 2026. For payments in 2027, check the current figures.
Who pays what
Salary tax of 10% and contributions of 19.90% are withheld from the employee's gross salary. What remains is the net salary. The employer adds another 15.15% in contributions on top of gross, out of its own funds. The total employer cost is therefore always gross multiplied by 1.1515. Employment contracts in Serbia usually state gross, while employees negotiate net, so converting in both directions is part of every payroll run.
Net-to-gross formula
The basic formula for a full-time monthly salary is:
net = gross - 10% × (gross - 34,221) - 19.90% × gross
Simplified: net = 0.701 × gross + 3,422.10. Rearranged for gross:
gross = (net - 3,422.10) / 0.701
Total employer cost: cost = gross × 1.1515. The formula holds while gross is between the lowest and highest contribution base. Below RSD 51,297 contributions are calculated on the lowest base, and above RSD 732,820 on the highest. For part-time work the tax-free amount applies proportionally.
Worked example: net salary of RSD 100,000
A full-time employee has an agreed net salary of RSD 100,000. We calculate gross and total cost.
- Gross = (100,000 - 3,422.10) / 0.701 = 96,577.90 / 0.701 = RSD 137,771.61.
- Salary tax = 10% × (137,771.61 - 34,221) = 10% × 103,550.61 = RSD 10,355.06.
- Employee contributions = 19.90% × 137,771.61 = RSD 27,416.55.
- Net = 137,771.61 - 10,355.06 - 27,416.55 = RSD 100,000.00. The check passes.
- Employer contributions = 15.15% × 137,771.61 = RSD 20,872.40.
- Total employer cost = 137,771.61 + 20,872.40 = RSD 158,644.01, the same as 137,771.61 × 1.1515.
| Item | Amount (RSD) |
|---|---|
| Gross salary | 137,771.61 |
| Salary tax (10%) | 10,355.06 |
| Employee contributions (19.90%) | 27,416.55 |
| Net paid out | 100,000.00 |
| Employer contributions (15.15%) | 20,872.40 |
| Total employer cost | 158,644.01 |
A conclusion employers often overlook: an employee with RSD 100,000 net costs the company about RSD 158,600 per month, or roughly RSD 1.9 million per year for 12 salaries, before commuting allowance and other expense reimbursements.
Minimum wage in 2026: table
The minimum net hourly wage in 2026 is RSD 371. The monthly minimum wage depends on the number of working hours in the month, so it is not the same every month.
| Hours | Net minimum (RSD) | Gross (RSD) | Employer cost (RSD) |
|---|---|---|---|
| 160 h | 59,360.00 | 79,797.29 | 91,886.58 |
| 168 h | 62,328.00 | 84,031.24 | 96,761.97 |
| 176 h | 65,296.00 | 88,265.19 | 101,637.37 |
| 184 h | 68,264.00 | 92,499.14 | 106,512.76 |
The hours depend on the number of working days in the month. For part-time employees the minimum wage is calculated proportionally. When gross falls below the lowest contribution base of RSD 51,297, contributions are paid on that base, which is exactly what happens with part-time work.
What else affects payroll
- Seniority bonus: at least 0.4% of base salary for every full year of service with the employer. It is part of gross and grows every year.
- Increases: at least 26% for overtime, 26% for night work and 110% for work on public holidays, under the Labor Law.
- Sick leave up to 30 days: paid by the employer, at least 65% of the employee's average salary over the previous 12 months (100% for work injuries).
- Commuting allowance: not salary, and tax-free up to the prescribed limit (check the current amount).
- Hiring incentives: several programs refund part of tax and contributions. Conditions change, so check the current programs before hiring.
If you are hiring for the first time, we described the registration with CROSO, the contract and the first PPP-PD filing in our article on employer obligations for the first employee. Foreign owners setting up a company will also find our guide to setting up a company in Serbia useful.
Deadlines and filings
For every salary payment the employer files the individual tax return PPP-PD electronically through the ePorezi portal, before the payment, and receives a BOP payment reference. Tax and contributions are paid on the same day as the net salary. Salaries are paid no later than the end of the month for the previous month. If the employer does not pay the salary by then, it must calculate and pay contributions for the previous month on the lowest monthly base by the end of that month. Forms and instructions are available from the Tax Administration of Serbia.
Common mistakes
- Agreeing on net without converting, so the budget shows net while the real cost is about 59% higher.
- Applying last year's tax-free amount in January before the software is updated.
- Forgetting the seniority bonus, which increases every year.
- Calculating the minimum wage as a fixed monthly amount instead of by hours.
- Paying the salary before the PPP-PD return is filed and the BOP reference received.
- Paying a commuting allowance above the tax-free limit without taxing the difference.
Frequently asked questions
What is the minimum wage in Serbia in 2026?
The minimum net hourly wage is RSD 371. For a month with 184 working hours that is RSD 68,264 net, RSD 92,499.14 gross, and a total employer cost of RSD 106,512.76.
Does the tax-free amount apply to part-time work?
Yes, proportionally. For an employee working half-time the tax-free amount is RSD 17,110.50. If an employee works for several employers, each applies a proportional share.
How is the salary of an entrepreneur paying themselves a personal salary calculated?
By the same logic, with the same rates and tax-free amount, but the entrepreneur sets the level of the personal salary, subject to the lowest contribution base.
What if gross salary exceeds RSD 732,820?
Contributions are calculated on the highest base of RSD 732,820, while the 10% tax is still paid on the entire amount above the tax-free part. The effective burden therefore falls for high salaries.
How NOTA GROUP can help
We run payroll for companies with one employee and with fifty: net-to-gross conversion, PPP-PD filings, sick leave, seniority bonus and the annual parameter update. Our accounting services also include advice on structuring salaries and allowances in line with the law. Book a consultation, send us your figures and we will return a complete calculation.
