Are you planning to prepare gifts for your employees’ children for Christmas and New Year? This is a common practise in Serbia. If you wish to follow it, here is what you need to know.

Labour Law of Republic of Serbia created an option to the employers is Serbia to decide whether they want to provide New Year’s gift to children of their emloyees, who are younger than 15. This is an option, not an obligation, and it depends on employer’s policy and liquidity.

Giving gifts is untaxable under certain conditions:

• gifts are given only to the children of employees
• children are not above 15
• value of the gift is not more than 12.544,00 dinars per child per calendar year (for payments made till 31st January 2024)
• gift is related to Christmas holidays

If all of those conditions are not met, gift is taxed as a salary, and the tax burden falls on employer. 

Gifts can be delivered as toys, candies, vauchers and money, or combination of those. The form doesn’t affect untaxabe amount.

Employer should draft Decision about gifts, which will contain list of employees and children who are entitled to a Christmas gift, and collect documents that proove every child is below 15.

If you hire both parents, child is entitled to two gifts, as each parent practise his right independently. In this case, both gifts are untaxable (provided all the conditions are met). This was confirmed within Opinion no. 011-00-46/2010 issued by Ministry of Finance of Republic of Serbia in 2010.