The self-employment test for entrepreneurs in Serbia is a tool used by the Tax Administration to determine whether an entrepreneur truly operates independently or essentially works as a disguised employee for one or dominant client. This test is still fully active and applies both to new and existing contracts, aiming to prevent abuse and ensure proper payment of taxes and contributions. The test is based on a set of criteria that examine how independent the entrepreneur is in running their business – from the number of clients, contract terms, and freedom in performing work, to taking business risks, owning equipment, and deciding on working hours.

An entrepreneur who works exclusively or almost exclusively for one client, uses the client’s equipment, receives compensation resembling a salary, has no autonomy in organizing work, or does not assume business risk risks being deemed non-independent by the Tax Administration. In such cases, income from that client may be retroactively treated as salary, which means obligations to pay personal income tax, pension and health contributions, and interest on arrears.

The test is applied not only to new arrangements but also retroactively, which makes it crucial for entrepreneurs to properly structure contracts and maintain documentation. The safest approach is to have multiple clients, clear contracts, autonomy in work, and assume business risk. Keeping records of invoices, payments, and communication with clients can help demonstrate independent operation in case of an inspection.

In essence, the self-employment test is not something to fear; it is a tool that protects genuinely independent entrepreneurs while ensuring that the state receives the proper taxes and contributions. Understanding the rules, proper documentation, and client diversification are key factors for successful business operation and avoiding issues with the Tax Administration.