7 main advantages of the Association:
Legal and documentary requirements:
In the moment, thanks to the rudimentary law and the attitude of banks, the Serbian Association has no match in the world market. Key is the legal definition of categories of persons who (do not) appear in the structure of the Association:
- Founders: passive category. At least three individuals or legal entities can register an Association.
- Legal representative: must be a citizen of Serbia or a foreign citizen with a residence permit in Serbia.
- Members: active category.
The most important category of persons in the structure. According to the law they are the legal and actual identity of the association. The Association can acquire assets through membership fees, voluntary contributions, donations and gifts (in money or in assets), financial subsidies, inheritance, interest on deposits, rent, dividends and other funds allowed by law. In the case of donation, the association pays a tax of only 2.5% gift tax. This legal form is used for association of experts in various sectors of the economy, for registering football clubs in Serbia and, of course, our company is organized in this way. It is worth mentioning that the first private companies in Serbia, even during a socialist economy, were registered as associations, so our jurisdiction have a tradition of successfully using Associations that can fully articulate economic interests and ensure the safety of the beneficiaries. Keeping in mind main advantages of the association, it must be emphasized that it is impossible to find a competitor to this solution on other meridians. Either the beneficiaries lose control over the property (trust) or they are disclosed in the process of registration of the so-called related parties according to the OECD procedures.
Frequently asked questions
What is Association?
Association is a non-profit organization with a status of a legal entity, founded by several persons in order to promote or achieve common or general aim or interest.
What is the main benefit of registering an Association in Serbia?
This is an unique way of combining non-commercial aims with commercial activity while maintaining complete control over the structure, in accordance with Serbian law.
What are the requirements regarding the legal identity and residency of the Founders?
Founders can be resident or non-resident individuals or legal entities. At least one of minimum three Founders must be a Serbian resident.
Is the information about Founders published on the registry web site?
The personal data of the Founders is stated in the Founding Act, which is not published on the registry web site.
Does the legal representative of the Association have to be Serbian resident?
Legal representative has to be Serbian resident.
Can the Founders be “removed” from the structure?
Founders are a passive category from the very beginning. In the moment of forming they will become the first Members of the Association, but they can leave the membership of the Association.
Can non-residents become Members of the Association?
No residency related restrictions are imposed on the Members.
Does the Assembly of the Association have full control over the structure?
Yes. The Assembly decides on the membership changes and appointment of the President and Board Members.
Is every Member of the Assembly authorized to vote on the Assembly?
This is not mandatory. Association can have Members that do not have voting rights.
Does the change of Membership have to be registered in the registry?
It doesn’t need to be declared to the registry.
Is it possible to conduct commercial activity as an Association?
Yes. Such engagement is subject to registration. Commercial activity needs to be related to the declared aims or interests.
Can the Association become an owner of share capital of foreign companies?
Given that the Association is a legal entity, it can form daughter structures in Serbia and abroad.
Can the Association become an owner of real estate?
Association can own real estate in Serbia and abroad.
Are there any tax exemptions related to the commercial activity?
If Association conducts commercial activity its profit is being taxed at the same rate as in case of commercial legal entities (15%). If its profit doesn’t exceed RSD 400k in a calendar year it shall not be taxed.
Can Association be subject to different tax rates?
Yes. Gifts are subject to special tax rate at 2.5%.