Step by step – manage funds from Payoneer account in Serbia

A lot of entrepreneurs in Serbia are wondering if they can  use Payoneer. If yes, how can they use it and what can they do with the funds they receive in their account?

Before we go through what you can do with the funds, step by step, let’s remember some basics:

Payoneer is viewed as another bank account you have. That means that for every income you receive, you have to have an invoice or an agreement for it. It doesn’t matter if you are going to transfer the funds to your domestic bank account or not.

Now, let’s imagine that you offered services and invoiced your client. Your client paid you to your Payoneer account and you now have several options

Transfer to a domestic bank account

The first option is to transfer the funds to a domestic bank account. You can use this option if you want to use the funds for payments in Serbia.

When you use Withdraw to Bank service, your bank will ask you to fill out a form on the origin of the funds. You will need to fill out what services you charged and attach the invoice based on which you received the funds. Do not create a new invoice for this transfer, you are using the ones you already made for your client. Remember, funds will be transferred in EUR/USD, not in the local currency. After the bank receives funds, you can convert them to RSD.

Note: The amount of funds you are transferring doesn’t have to be identical to the invoice, but the amount on the invoice can’t be less than funds transferred. In that case, you wouldn’t have justification for the funds you received. Although the bank wouldn’t see your customer (from the invoice) as a payer, but Payoneer, there shouldn’t be any problem to receive funds. Banks are familiar with the way Payoneer as an institution of electronic money works.

Once the bank processes the form, you will receive the funds in your domestic account. Now you have two options:

• Conversion

In order to use the funds in Serbia, you will need to convert it to dinars first, and then use it for your expenses. If you are not registered as an entrepreneur or a legal entity, you would need to report income to the tax authorities and pay the taxes for it.

• Office rent or travel expenses

You don’t have to convert your funds from your foreign currency account. You can keep it on your account to pay for the office rent or travel expenses. Why just for these two things? Because only these kinds of payments are allowed to be made in Serbia in the foreign currency, by our laws. Keep in mind that if you are paying a lease to a natural person, you need to calculate the taxes and pay them, before paying the net amount, and that for travel expenses you should prepare the documents about your trip, to submit them to the bank.

Payments to foreign entities or persons

Do you have to withdraw the funds to a domestic bank account? Of course not! You can use the funds you have in your Payoneer account for payments to foreign entities or persons.

Why just to foreigners? Because it is defined by law on foreign exchange operations that you can have transactions between our residents only in dinars (the two exceptions are mentioned above – rent or travel expenses).

If you expect to have expenses abroad, keep in mind that you can pay them directly from your Payoneer account and avoid the hassle and expenses of transferring the funds to a domestic bank.

Leave the funds on your Payoneer account

If you want to keep the funds in your Payoneer account – you can. You can keep it until you receive additional payments, and then withdraw to bank account all at once, or you can save the funds there for a future business trip … it’s your choice!

Conclusion

You can view your Payoneer account as any other bank account in the foreign currency. You can receive payments if you have an invoice or an agreement for it. How you decide touse yourfunds is your choice, but keep in mind that you can’t make payments directly from Payoneer to another Serbian resident.

If you are a lump sum taxed entrepreneur (“pausalac”), you can easily create invoices, charge your services with Payoneer and keep track of all of the legal responsibilities with the help of one app – Pausal. With Pausal, you can digitalize your business, and if you have any questions, pausal team is there to help you.