The liquidation of a company through the regular procedure typically lasts just over 120 days.

To initiate liquidation, the first step is to engage a legal professional (attorney).

The attorney will prepare the documentation for initiating liquidation proceedings and file it with the Serbian Business Registers Agency (SBRA / APR).

Once liquidation is opened, the company name is formally changed to include the words “IN LIQUIDATION” (U LIKVIDACIJI).

Due to this name change, the legal representative must visit the bank and sign a new signature card. This is a standard procedure in most banks.

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Steps After Liquidation Begins

Once the SBRA issues a decision to open the liquidation procedure:

• The accountant prepares extraordinary financial statements and calculates corporate income tax for the period from the beginning of the calendar year until the date liquidation was initiated.

• The financial statements must be submitted to the SBRA within 60 days, and the tax return must be submitted to the Tax Administration within 30 days.

• The corporate income tax for this period must be paid before the tax return is submitted. If no taxable profit was generated, no tax is due.

From the opening of liquidation onward:

• Advance corporate income tax payments are no longer required,

• Chamber of Commerce membership fees are no longer due.

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Legal Representative vs. Liquidator

Upon entering liquidation:

• The company no longer has a Managing Director; instead, a Liquidator is appointed (usually the same person).

• Taxes and contributions for the Liquidator are calculated monthly, in the same way as for the Managing Director, and depend on the form of engagement.

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Permitted Business Activities During Liquidation

During liquidation, the company should not enter into new business arrangements, but may:

• Collect outstanding receivables,

• Sell assets,

• Settle all liabilities (to suppliers, employees, government, and other creditors).

Routine business activities continue as needed, such as:

• Paying rent, utilities, accounting and legal fees, and taxes,
  until the procedure is finalized.

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Debt Settlement and Founder Loans

All liabilities must be settled before the liquidation can be closed.
This includes founders’ loans, which must be resolved either by:

• Repayment, if funds are available, or

• Conversion into equity, which must be registered with the SBRA.
  Consult your attorney for the proper procedure.

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Final Stage: Closing the Liquidation

The attorney prepares the documentation for closing the liquidation.
The company must issue a formal decision on liquidation closure.

The accountant:

• Calculates final taxes and contributions (typically for the Liquidator’s last month),

• Files all outstanding tax returns, and

• Requests two certificates:

  1. Certificate of settled tax obligations from the Tax Administration, and

  2. Certificate of settled local public revenues from the local government.

Tax inspectors may:

• Require additional documentation,

• Verify taxes and contributions paid for the founders, directors, and office rent for previous years.

Once both certificates are issued:

• They must be submitted together to the SBRA within 5 days, along with the final liquidation documentation prepared by the attorney.

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Deletion from the Business Register and Final Accounting

The SBRA will then issue a Decision on Deregistration.

The accountant must:

• Prepare extraordinary financial statements as of the date of deregistration, and

• Submit them to the SBRA within 60 days.

A final tax return and corporate income tax calculation must also be prepared.
Usually, no profit is generated in this period, so no tax is due — but exceptions are possible.

The tax return must be submitted within 60 days from the date of SBRA’s deregistration decision.

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Distribution of Remaining Funds – Liquidation Surplus

Any funds remaining in the company’s bank account after liquidation are distributed to the founders.
This is called the liquidation surplus.

If the distributed amount exceeds the founder’s registered share capital, the surplus is taxed as a dividend.

• Dividend tax rate: 15% (must be paid before deregistration)

• If the amount is less than or equal to the founder’s registered capital, no dividend tax is due.

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Typical Liquidation Costs

During the procedure, the company should budget for the following:

• Compensation for the Liquidator (including taxes and contributions) for 4–5 months

• Office rent for 4–5 months

• Accounting fees for maintaining records and preparing two sets of extraordinary financial statements and two corporate income tax returns

• Corporate income tax (if applicable) for:

  • The period before liquidation,

  • The period during liquidation

• Bank fees

• SBRA registration fees

• Fees for issuing certificates from the Tax Administration and local authorities

• Reserve funds for unforeseen expenses

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🗓️ Note: This procedure reflects the legal framework effective from January 1, 2025.