Invoicing Foreign Clients as a Serbian Paušalac

Last updated: March 2026. Reflects current invoice requirements under Serbian law for non-VAT entrepreneurs.

Most Serbian paušalci in the IT and creative sectors earn the majority — or all — of their income from foreign clients. This creates a set of practical challenges that domestic-only paušalci never face: invoicing in foreign currencies, converting to dinars at the correct rate, navigating the place-of-supply rules for PDV exemption, and avoiding the notorious banking issue where the Tax Authority sees your revenue counted twice.

This guide walks through everything you need to know about issuing invoices to foreign clients, from mandatory fields to currency conversion, from the "nije u sistemu PDV" rule to the double-count trap that has triggered many unnecessary Tax Authority inquiries.

What must a paušalac's invoice contain?

Serbian law prescribes mandatory elements for invoices (račun / faktura) issued by entrepreneurs. Since paušalci are not in the VAT system, the requirements come from the Zakon o računovodstvu (Accounting Law, "Sl. glasnik RS", br. 73/2019) and the Zakon o trgovini (Trade Law) rather than the VAT-specific Article 42.

Every invoice you issue must include:

Your business details (issuer)

• Poslovno ime — your full registered business name (e.g., "MARKO MARKOVIĆ PR PROGRAMIRANJE BEOGRAD")
• Sedište — your registered business address
• PIB — your Tax Identification Number
• Matični broj — your APR registration number
• Tekući račun / IBAN — your bank account for payment (domestic account number for Serbian clients, IBAN for international clients)

Client details (recipient)

• Full company name — the legal entity name of your client
• Address — registered address of the client
• Company registration number or VAT ID — if applicable in their country
• Country — especially important for the PDV place-of-supply determination

Invoice specifics

• Redni broj računa — sequential invoice number. Must be unique and sequential within the calendar year. Common formats: "2025-001", "001/2025", "INV-2025-001". The numbering resets each January 1.
• Datum izdavanja — date of issue (when you created the invoice)
• Datum prometa — date of service delivery or goods supply. This is the accrual date that determines which period the revenue counts toward. If the service was delivered over a period (e.g., monthly retainer for March), this is typically March 31.
• Rok plaćanja — payment deadline (e.g., "Net 30", or a specific date). Optional but standard practice.
• Description of services/goods — what you provided. Can be brief: "Software development services, March 2025" or more detailed with line items. Include quantity and unit price if applicable.
• Total amount — the total sum with the currency clearly stated (e.g., "€3,000.00" or "3,000.00 EUR")

The critical non-VAT notation

Since paušalci are not registered for PDV (VAT), your invoice must include a note stating this. The standard formulation is:

"Nije u sistemu PDV-a na osnovu člana 33. Zakona o PDV-u." (Not in the VAT system pursuant to Article 33 of the VAT Law.)

This note is not optional — it's legally required. And the converse rule is equally important: never show a VAT amount on your invoice. If you accidentally include a line like "PDV 20%: €600" on your invoice, you create a legal obligation to remit that VAT to the state — even though you're not a VAT payer. The Tax Authority has been known to enforce this strictly. No VAT line, no VAT percentage, no VAT total. Your invoice total is the total.

For foreign clients, you can add an English equivalent beneath the Serbian text:

The issuer is not registered for VAT (PDV) under Article 33 of the Serbian VAT Law.

Stamp and signature

A company stamp (pečat) has not been mandatory in Serbia since 2017. You may include one if your client expects it (some foreign companies are accustomed to seeing stamps on Serbian documents), but it has no legal significance. A signature (handwritten, facsimile, or electronic) is sufficient. For electronic invoices, a typed name serves as the identification mark (identifikaciona oznaka) under the Zakon o računovodstvu.

Invoicing in foreign currency: what's allowed

Paušalci can issue invoices in any currency — EUR, USD, GBP, CHF, or any other. There is no legal requirement to invoice in dinars.

In practice, almost all invoices to foreign clients are issued in EUR or USD. The invoice shows the foreign-currency amount; the client pays in that currency to your foreign-currency bank account (devizni račun); and the bank eventually converts it to dinars.

However, for all Serbian tax and record-keeping purposes — your KPO knjiga, your revenue limit calculations, your official turnover — the amount must be expressed in Serbian dinars (RSD). The conversion rule is straightforward: use the NBS official middle exchange rate on the datum prometa.

Step-by-step conversion example

1. You issue invoice #2025-015 to a German client for €4,000
2. Datum prometa (service date): May 20, 2025
3. NBS middle rate on May 20, 2025: 117.42 RSD/EUR
4. KPO entry: 469,680 RSD (4,000 × 117.42)
5. Your 6M calendar-year limit now includes this 469,680 RSD
6. Your 8M rolling 12-month limit also includes this 469,680 RSD

What the bank actually credits to your RSD account when the client pays (maybe 2 weeks later, at a different rate, minus bank fees) is irrelevant for these calculations.

Where to find the NBS middle rate

The official source is the NBS website (nbs.rs → "Kursna lista"). For a given date, you need the "Srednji kurs" (middle rate) row for your currency.

For programmatic access, the unofficial API at kurs.resenje.org provides the same NBS data in a developer-friendly format. While convenient, for tax purposes you should verify the rate against the official NBS publication, especially for large invoices.

The double-count trap

This is the single most anxiety-inducing issue for paušalci who invoice in foreign currency, and it comes up constantly in forums and community discussions.

What happens

Here's the sequence:

1. Your German client sends €4,000 to your EUR devizni račun at Raiffeisen bank on June 5.
2. The bank records an incoming transaction: +€4,000 (credit to your EUR account).
3. A few days later, you convert the EUR to RSD. The bank records: -€4,000 (debit from EUR account) and +466,000 RSD (credit to your RSD account, at the bank's conversion rate).
4. Your annual bank statement now shows three transactions related to this single invoice: the EUR credit, the EUR debit, and the RSD credit.

When the Tax Authority reviews bank data (which they can access from the bank), they might initially see the incoming €4,000 (converted to ~469,000 RSD at NBS rates) plus the 466,000 RSD deposit — and calculate your revenue as ~935,000 RSD from a single €4,000 invoice.

Why it matters

If the Tax Authority cross-references bank data against your KPO and sees bank deposits that appear to significantly exceed your KPO total, this triggers a flag. The mismatch between "apparent bank revenue" and "declared KPO revenue" can generate an inquiry letter (zahtev za pojašnjenje) asking you to explain the discrepancy.

How to protect yourself

The solution is documentation clarity:

1. Your KPO records the correct single amount: 469,680 RSD (based on NBS rate at service date). This is your revenue. Period.

2. Keep all invoices on file matching each KPO entry. The Tax Authority can reconcile: Invoice #015 → KPO entry #15 → bank deposit.

3. If you receive an inquiry, explain that the bank statement reflects two movements (foreign currency in, conversion to RSD) for a single business transaction, and point to the matching invoice and KPO entry.

4. Consider converting currency promptly after receiving payment, to minimize the window where your EUR account shows a balance that might be counted as "additional" revenue.

5. Maintain a simple reconciliation document (even a spreadsheet) mapping each invoice to the specific bank transaction(s) it corresponds to. This isn't legally required but dramatically speeds up any inspection.

The double-count issue is well-known at the Tax Authority and resolved easily with proper documentation. It's not a legal problem — it's an administrative confusion that good record-keeping prevents.

Place of supply and the PDV exemption for foreign services

This section matters for the 8-million PDV threshold specifically. Understanding it can mean the difference between mandatory VAT registration and staying safely under the limit.

The basic rule

Under Article 12 of the Zakon o PDV, the place of supply (mesto prometa) for services provided to a foreign legal entity (a company) is the country where the recipient is established — not Serbia. This means such services are treated as supplied outside Serbia for PDV purposes.

What this means for the 8M limit

Services where the place of supply is outside Serbia do not count toward the 8,000,000 RSD PDV threshold. If you provide software development services exclusively to a company in Germany, those services are "supplied" in Germany, and the revenue from them doesn't enter the 8M calculation.

However — and this is critical — this same revenue does count toward the 6,000,000 RSD paušal calendar-year threshold. The exemption applies only to the PDV limit, not the paušal limit.

When the exemption applies

The exemption applies when:

• You provide services (not goods) to a legal entity (company, not an individual)
• The recipient is established outside Serbia (has their business seat in another country)
• The service type falls under the general B2B rule (most IT, consulting, marketing, design, translation services qualify)

When the exemption does NOT apply

The exemption generally does not apply to:

• Services related to immovable property located in Serbia
• Cultural, artistic, sporting, educational, or entertainment services physically performed in Serbia
• Services provided to individuals (B2C) rather than businesses
• Transport services where the supply occurs partly in Serbia

A practical scenario

You're a web developer earning €4,000/month from a US client and €1,500/month from a Serbian client:

• 6M paušal limit (calendar year): Counts both. That's approximately 5,500 × 117 = 643,500 RSD/month, or ~7,722,000 RSD/year. You'd exceed the 6M paušal limit.
• 8M PDV limit (rolling 12 months): Only the Serbian client's revenue counts (the US client's services are "supplied" in the US). That's ~1,500 × 117 = 175,500 RSD/month, or ~2,106,000 RSD/year. Well under 8M.

In this scenario, you'd lose paušal status (exceeding 6M) but wouldn't need to register for PDV (under 8M excluding foreign services).

The documentation requirement

To claim the place-of-supply exemption, you should be able to demonstrate:

• The client is a foreign legal entity (their registration documents, or at minimum, a verifiable company name and foreign address on your invoices)
• The services were performed for the client's business purposes (a contract or service agreement helps)
• The services fall under the general B2B rule

You don't need to file a special form or get pre-approval. But if the Tax Authority questions whether you should be PDV-registered, you need to show that your foreign-service revenue legitimately doesn't count toward the 8M threshold.

Invoice template for foreign clients

Here's a standard invoice structure for a Serbian paušalac invoicing a foreign client:

[YOUR BUSINESS LETTERHEAD / LOGO]

INVOICE / FAKTURA

Invoice No: 2025-015
Date of issue (Datum izdavanja): May 22, 2025
Date of service (Datum prometa): May 20, 2025
Payment due: June 21, 2025

FROM:
Marko Marković PR Programiranje Beograd
Knez Mihailova 42, 11000 Beograd, Srbija
PIB: 112233445
Matični broj: 66554433
IBAN: RS35265000000123456789
SWIFT: RZBSRSBG

TO:
TechCorp GmbH
Friedrichstraße 123, 10117 Berlin, Germany
VAT ID: DE123456789

DESCRIPTION                              AMOUNT
─────────────────────────────────────────────────
Software development services,           €4,000.00
May 1-20, 2025
─────────────────────────────────────────────────
TOTAL:                                   €4,000.00


Payment terms: Bank transfer to the IBAN above.
Please include invoice number in payment reference.

Nije u sistemu PDV-a na osnovu člana 33. Zakona o PDV-u.
(The issuer is not registered for VAT under Article 33
of the Serbian VAT Law.)


________________________
Marko Marković

Adjust as needed — there's no mandated visual format, only required content. Some paušalci add additional elements: purchase order numbers (if the client requires them), hourly breakdowns, project references. All fine as long as the mandatory elements are present.

Receiving payment: practical banking notes

Bank accounts for foreign payments

To receive foreign-currency payments, you need a devizni račun (foreign currency account) at your Serbian bank. Most banks offer EUR and USD accounts; some offer GBP and CHF. Opening one is straightforward — just request it from your existing business bank.

When your client's payment arrives, it lands in your devizni račun. You then convert to RSD at your convenience (some banks auto-convert, others let you hold foreign currency and convert manually). The conversion rate is the bank's own rate, which is less favorable than the NBS middle rate.

SWIFT fees and correspondent bank charges

International transfers often incur SWIFT messaging fees and correspondent bank charges. A €4,000 payment might arrive as €3,980 after fees. The "missing" €20 is a banking cost, not a revenue reduction — your KPO still records the full invoiced amount (€4,000 converted at NBS rate). The fee difference is simply a cost of doing business that paušalci absorb.

Payment platforms (Wise, Payoneer, Deel)

Many paušalci receive payments through Wise (formerly TransferWise), Payoneer, or similar platforms rather than direct bank transfers. This is generally fine, with a few notes:

• The payment still constitutes business revenue regardless of the receiving channel
• Your KPO records the invoiced amount at the NBS rate on the service date — not the amount that actually arrives after platform fees
• When you transfer from Wise/Payoneer to your Serbian bank, the bank sees an incoming transfer that should match (approximately) one of your invoices
• Keep records of platform transactions for reconciliation purposes

Key takeaways

1. Mandatory invoice elements: business name, PIB, matični broj, address, IBAN, invoice number, issue date, service date, client details, description, total amount, and the "nije u sistemu PDV" note.
2. Never show VAT on your invoice. You're not a VAT payer. Showing a VAT line creates a legal obligation to remit it.
3. Convert to RSD at the NBS middle rate on the service date for your KPO and limit calculations. Not the bank rate, not the payment-date rate.
4. The double-count trap is an administrative issue, not a legal one. Good documentation (matching invoices → KPO → bank transactions) resolves it instantly.
5. Foreign-service revenue may not count toward the 8M PDV threshold if the place of supply is outside Serbia. But it always counts toward the 6M paušal threshold.
6. Keep your invoices, contracts, and a simple reconciliation. When an inquiry comes — and for active paušalci billing foreign clients, it eventually will — clear records turn a potential headache into a 10-minute administrative exercise.