Commercial lease contract in Serbia (ugovor o zakupu poslovnog prostora): contents, notarisation, termination, tax

What a commercial lease contract is

A commercial lease contract (ugovor o zakupu poslovnog prostora) is a contract by which the landlord undertakes to hand over a shop, office, warehouse, hall or other business premises to the tenant for use, and the tenant undertakes to pay rent (Art. 567 of the Law on Contracts and Torts, Zakon o obligacionim odnosima, Sl. list SFRJ No. 29/78 ... Sl. glasnik RS No. 18/2020). Unlike an apartment lease, which has a special regime in the Housing and Building Maintenance Act, business premises are covered only by the general lease rules in Art. 567 to 599 of the Law on Contracts and Torts. There is no separate "commercial lease act", and no new statute changing these rules was passed in 2025 or 2026. The core rules have been unchanged since 1978.

Almost everything can be agreed freely, and the statute fills the gaps where the contract is silent. Its default rules were not written for business premises: an eight-day notice period, rent payable half-yearly unless otherwise agreed (Art. 583(2)), or subletting without the landlord's consent (Art. 586) rarely suit the parties. That is why a commercial lease is usually longer and more detailed than an apartment lease.

What a commercial lease must contain

The essential elements are the premises and the rent. Everything else is a matter of agreement, and the clauses most often regulated are:

• Permitted use and permits. The tenant may use the premises only as set out in the contract or according to their purpose (Art. 581). The contract states the business to be carried on and who obtains the approvals for it (for example for catering, production or change of use). If the tenant keeps using the premises contrary to the contract after a warning, the landlord may terminate without notice (Art. 582).
• Condition and maintenance. The landlord hands over the premises in proper condition and keeps them so; minor repairs caused by ordinary use and the costs of use itself fall on the tenant (Art. 569 and 570). The landlord is liable for defects that hinder the agreed use (Art. 573).
• Fit-out. Business premises are almost always adapted. The contract states what the tenant may alter, who pays for the works, whether the investment is offset against rent and what stays when the lease ends. The statute only says that the tenant returns the premises in the condition received and may remove additions that can be detached without damage, while the landlord may keep them against payment of their value (Art. 585).
• Rent and indexation. Amount, due date, currency clause and VAT. The Foreign Exchange Act allows rent for real estate between residents to be paid in foreign currency too (Art. 34(2)(5)), but in practice the dinar equivalent at an agreed rate is used. Longer leases provide for annual indexation to the consumer price index.
• Term and notice. A fixed-term lease ends when the term expires (Art. 595). If the tenant keeps using the premises and the landlord does not object, a new lease for an indefinite term arises on the same conditions, and security given by third parties lapses (Art. 596). Renewal is therefore agreed expressly, with a new deposit or guarantee.
• Subletting. Without a ban in the contract, the tenant may sublet if this does not harm the landlord (Art. 586). If consent is required, the landlord may refuse it only for justified reasons (Art. 587), and a sublease without the required consent is a ground for termination (Art. 588). The landlord may claim payment directly from the subtenant (Art. 589).
• Security. The statute does not regulate deposits, so the amount, purpose and return date go into the contract. For larger leases a promissory note, bank guarantee or founder's guarantee is required.

Does a commercial lease contract have to be notarised

No. A lease is not on the list of contracts that must be solemnised (Art. 93 of the Law on Notaries, Zakon o javnom beležništvu, Sl. glasnik RS No. 31/2011 ... 80/2026), and the Law on Contracts and Torts does not even require written form. An oral commercial lease is valid, but it does not occur in practice, because the bank, the accountant, inspectors and the APR (on a change of seat) all ask for a written contract.

There are three levels of form:

1. A plain written contract signed by the parties. Sufficient for validity and for tax records.
2. Signature certification by a notary. Confirms who signed and when, which removes disputes over the signature and the date.
3. Solemnisation (a notarially confirmed private document) or a notarial deed with a statement of consent to direct enforcement. Such a document is an enforceable document if it sets out a specific obligation and contains the obligor's express statement that enforcement may be carried out directly on that basis once the obligation falls due (Art. 85 of the Law on Notaries). The obligation may be monetary (rent) or non-monetary (vacating and handing back the premises on expiry or termination). The landlord then does not need a lawsuit: on the basis of that document the landlord files an enforcement motion with the court, and a public enforcement officer carries out the eviction (Art. 353 and 355 of the Law on Enforcement and Security).

The third level costs more, but it saves the landlord a lawsuit against a tenant who neither pays nor leaves. For the tenant it means the risk of fast enforcement, so it is then important to define precisely what counts as maturity and how termination is proved.

Registering the company's seat at the leased premises

A commercial lease is the most common basis for a company's seat. The seat is the place and address from which the company's business is managed and it is registered with the Business Registers Agency (APR) (Art. 19 of the Companies Act, Zakon o privrednim društvima, Sl. glasnik RS No. 36/2011 ... 19/2025). To register incorporation the APR requires the founding act, proof of the founders' identity and proof of payment of the fee, but not a lease contract or the owner's consent.

The owner is protected another way: a person holding the ownership right may sue for deletion of the registered seat address if he or she did not allow the premises to be used for managing the company; the procedure is urgent, and if the company does not register a new address within 30 days of the final judgment, the APR starts compulsory liquidation ex officio (Art. 19(5) to (9)). The lease therefore includes the landlord's express consent for the tenant to register its seat, branch or mailing address at the premises, and the tenant's duty to change the address within a set period after the lease ends.

Lease from a private individual: income tax and VAT

When a company or sole trader rents premises from an individual, the landlord earns real-estate income under the Personal Income Tax Act (Zakon o porezu na dohodak građana, Sl. glasnik RS No. 24/2001 ... 80/2026):

• the base is the gross rent reduced by 25% standardised costs (Art. 65v), and gross rent includes the value of obligations taken over by the tenant, except costs that depend on the tenant's consumption, such as electricity and telephone (Art. 65a(2)),
• the rate is 20% (Art. 65g), so the tax is 15% of gross rent,
• the landlord may ask for actual costs to be recognised instead of standardised costs if he or she proves them (Art. 65v(3)),
• when the payer is a legal entity, sole trader or flat-rate sole trader, the tax is calculated and paid by withholding (Art. 99(1)(4)): the tenant withholds the tax on payment and pays the landlord the net amount,
• when the rent is paid by an individual, the landlord files form PP OPO within 30 days of receiving the income (Art. 100a(1)(3) and Art. 95).

The contract therefore states clearly whether the rent is gross or net. If it says only "RSD 100,000", the tenant calculates the tax out of that amount and pays RSD 85,000, a frequent source of dispute in the first month.

If a landlord who is an individual lets several premises as a registered business, the income is taxed as income from self-employment (Art. 65a(3) and Art. 65b(2)). Property tax on the premises is paid by the owner (Art. 4 of the Property Taxes Act), and if the tenant agrees to refund it, that amount forms part of gross rent.

VAT. Only the lease of apartments for residential purposes is exempt (Art. 25(2)(4) of the VAT Act, Zakon o porezu na dodatu vrednost, Sl. glasnik RS No. 84/2004 ... 80/2026). The lease of business premises is taxed at the general rate of 20% (Art. 23), but only if the landlord is a VAT payer. An individual outside the VAT system does not charge VAT, so for a tenant in the VAT system such a lease is more expensive, as there is no input VAT to deduct.

Rent-free use of business premises

This is searched for when a founder wants to let his or her own company use premises without rent, usually for the seat. Legally that is not a lease: without rent there is no lease (Art. 567), but a loan for use (posluga), a gratuitous handing over of a thing for use. The Law on Contracts and Torts does not regulate it, so the general rules on contracts and the legal rules of the pre-war civil codes apply. The contract is valid, is made in writing and contains the same elements as a lease except rent: the premises, use, term, costs and consent to register the seat.

The tax effect for an owner who is an individual: real-estate income is the rent received (Art. 65a(2)), so without rent there is no tax on real-estate income. If the owner is a VAT payer (for example a sole trader in the VAT system), a free-of-charge supply of services for non-business purposes is treated as a supply for consideration (Art. 5(4) of the VAT Act), so the Tax Administration may claim VAT on the cost of the service. The Tax Administration also looks at the economic substance: if rent is actually paid in cash, a rent-free contract does not help. Check the treatment with an accountant before signing.

Termination of a commercial lease and eviction

The statute distinguishes notice (otkaz) from rescission (raskid), but in practice both are called termination. The contract ends:

• on expiry of the term for a fixed-term lease (Art. 595), with no notice needed,
• by notice for an indefinite lease, with the agreed notice period or, if none is agreed, eight days, and notice may not be given at an inopportune time (Art. 597),
• by the landlord's notice for non-payment, if the tenant does not pay within 15 days of a call to pay, the contract staying in force if the tenant pays before the notice is communicated (Art. 584), for use contrary to the contract after a warning (Art. 582), and for an unauthorised sublease (Art. 588),
• at the tenant's request for defects that cannot be remedied or were not remedied within an additional period (Art. 578) and for repairs that hinder use considerably and for a long time (Art. 571),
• by destruction of the premises through force majeure (Art. 598); the death of a party does not end the lease, which continues with the heirs unless otherwise agreed (Art. 599).

For other breaches the general rules apply: the other party is given a reasonable additional period, and rescission for a negligible part of the obligation is not allowed (Art. 126 and 131). Notice and rescission are given in writing, with proof of receipt.

When the tenant does not leave, the landlord may not change the locks or remove the tenant's belongings. Eviction is carried out as enforcement for vacating and handing over real estate (Art. 353 to 355 of the Enforcement and Security Act, Zakon o izvršenju i obezbeđenju), which requires an enforceable document: a final judgment or a notarial document with an enforcement clause (Art. 41). Enforcement begins 30 days after the debtor receives the enforcement order. Without an enforcement clause the landlord must first obtain a judgment in litigation, which takes time. This is the main reason commercial leases are solemnised.

Common mistakes

• The rent is agreed without stating whether it is gross or net and whether it includes VAT.
• There is no fit-out clause, so the parties argue over investments and removal of equipment when the lease ends.
• No notice period is agreed, so the statutory eight days apply.
• There is no consent to register the seat, and the owner later sues for deletion of the address.
• A fixed-term lease is tacitly renewed, and the promissory note or guarantee expired with the first contract (Art. 596(2)).

A short overview of the clauses usually found in the contract: parties, premises and their condition, permitted use and seat, rent and VAT, indexation, term and notice, costs and maintenance, fit-out, subletting, security, handover, enforcement clause, dispute resolution. This is an overview of content, not a ready-made contract text.

Sources

• Law on Contracts and Torts (Zakon o obligacionim odnosima, Sl. list SFRJ No. 29/78 ... Sl. glasnik RS No. 18/2020), Art. 124-132 and 567-599
• Law on Notaries (Zakon o javnom beležništvu, Sl. glasnik RS Nos. 31/2011 ... 80/2026), Art. 85 and 93
• Notary Tariff (Javnobeležnička tarifa, Sl. glasnik RS Nos. 91/2014 ... 59/2025), Art. 10 and tariff items 1, 8 and 9
• Personal Income Tax Act (Zakon o porezu na dohodak građana, Sl. glasnik RS Nos. 24/2001 ... 80/2026), Art. 65a-65g, 95, 99 and 100a
• VAT Act (Zakon o porezu na dodatu vrednost, Sl. glasnik RS Nos. 84/2004 ... 80/2026), Art. 5, 23 and 25
• Companies Act (Zakon o privrednim društvima, Sl. glasnik RS Nos. 36/2011 ... 19/2025), Art. 19
• Property Taxes Act (Zakon o porezima na imovinu, Sl. glasnik RS Nos. 26/2001 ... 94/2024), Art. 2 and 4
• Enforcement and Security Act (Zakon o izvršenju i obezbeđenju, Sl. glasnik RS Nos. 106/2015 ... 91/2025), Art. 41 and 353-355
• Foreign Exchange Act (Zakon o deviznom poslovanju, Sl. glasnik RS Nos. 62/2006 ... 19/2025), Art. 34
• Tax Administration: how to report income from letting real estate
• APR: incorporation of a company, required documents