The following conditions must be fulfilled in order to exercise the right to the exemption:
- The foreigner must be employed in his own country and possess the proof of employment (the confirmation on compulsory social insurance issued by a competent authority of foreign country),
- The Republic of Serbia must have signed an international agreement on social insurance with a foreign country of residence of the employed foreigner, and
- The mentioned agreement must predict exemption from payment of compulsory social contributions for the period when the foreigner is insured in his own country based on employment.
However, this exemption cannot be applied in case when the founder is insured in a foreign country based on retirement, entrepreneurship and freelance work.
Ministry of Labor and Social Politics published Opinion number 011-0000964/2010-07 on 2 February 2011 related to the citizen of Montenegro who is a founder of a company in Serbia and employed in Montenegro where he exercises the right to compulsory social security, in which the following is stated:
“…individual who performs independent activity in Serbia, and at the same time has compulsory social insurance based on employment for pension and disability insurance in one of the countries Serbia has concluded agreement on social insurance and submit proper proof regarding this matter, such individual is not obliged for compulsory social insurance in Serbia, i.e. does not have the feature of insured person according to the regulations of retirement and disability insurance, which means that such individual is not obliged to pay contributions to the same basis.”
Double taxation of contributions is regulated in the same manner in most of these agreements. Serbia concluded such agreements with Bosnia and Herzegovina, Macedonia, Croatia, Slovenia, Bulgaria, Slovakia, Germany, Austria, France, Italy, Switzerland, Netherlands, Sweden and Belgium.
In case when there is no international agreement on social insurance concluded between the Republic of Serbia and other countries in which the foreigner is paying the contributions, the provisions of social insurance of the Republic of Serbia will be applied. In this case, foreigners who meet the conditions for being social insured are obliged to pay social contributions based on work in a company (within the employment or out of it).