If you are from the Balkans and considering starting a business, you’ve likely heard about both the local DOO (limited liability company, known as “Društvo so Ograničena Odgovornost” in Macedonia or “Društvo sa Ograničenom Odgovornošću” in Serbia) and the US LLC (limited liability company). Both are popular choices for small and medium-sized businesses, but the way they are set up, taxed, and managed can be very different. If you understand these differences, it can help you choose the right structure for your goals.
Formation Requirements
Let’s start with the basics: how each company type is actually created and what documents or steps you need to begin.
DOO: Starting a DOO in Macedonia, Serbia, or the region usually requires multiple steps. You need notarized documents, registration with the local business registry, and, in some cases, additional approvals. Founders must prepare a founding agreement and deposit the starting capital into a bank account before the company can be registered or soon afterwards. The process is straightforward but bureaucratic, and it may take several days to complete.
US LLC: In the US, forming an LLC is much simpler. You file Articles of Organization with the state, appoint a registered agent, and pay a filing fee. The whole process is usually done online, and in most states it can be completed within a few days. No notarization, no bank deposit, and no in-person visits are required. The registered agent can do it all on your behalf.
A DOO requires more paperwork, steps, and sometimes in-person involvement. A US LLC can be created quickly and fully online, making it especially appealing for non-residents.
Starting Capital
Here’s what you need to know about the money you must put into the company before it starts operating. With a DOO, you need to lock in starting capital upfront, which can tie up resources, and with an LLC, you can begin lean without having to prove funding.
DOO
Balkan DOOs require minimum starting capital. In Macedonia, the minimum is €5,000 (and sometimes €1, while in Serbia it is €100, but many entrepreneurs still deposit more to strengthen credibility with banks and partners. This capital must be deposited into a bank account and becomes part of the company’s equity.
US LLC
In the US, there is no legal minimum capital. Members can contribute money, assets, or even services, but they are not required to deposit anything to form the company.
Ownership Structure
Ownership works very differently between these two systems, so it’s important to understand how flexible or not each one is. We would say that a DOO has more formal rules about ownership and transfers; on the other hand, a US LLC gives you far more flexibility to structure ownership and bring in partners or investors.
DOO: A DOO is owned by members who hold “ownership stakes” in the company. These stakes are registered with the Central Registry (in Macedonia) or Business Registers Agency (in Serbia). It is similar in Bosnia, Croatia, Albania, and other countries in the region. Transferring ownership requires notarization and registry procedure.
US LLC: An LLC is owned by members as well, but ownership is flexible and defined in an Operating Agreement. Members can agree on different profit splits and management rights, regardless of capital contributions. Ownership can be transferred more easily, depending on the rules the members set.
Liability Protection
The good news? Both structures protect your personal assets; here’s how that works in practice.
Both DOO and LLC structures are designed to protect owners from personal liability. If the company incurs debts or faces lawsuits, members are only responsible up to the amount of their investment.
On this point, both structures work the same; your personal assets are shielded from company obligations.
Taxation
Taxes are one of the biggest differences, and understanding this part can completely change which option is better for you.
An important thing to note is that DOO always results in two layers of taxation, and a US LLC is never taxed on a corporate level. Furthermore, it can eliminate that issue for non-resident owners, making it much more tax-efficient for international or online businesses.
DOO: A DOO is taxed as a separate legal entity. In Macedonia, corporate income tax is 10%; in Serbia, it is 15%. When profits are distributed to members as dividends, an additional 10% tax applies. This creates double taxation, once at the company level and again at the personal level.
US LLC: An LLC is a “pass-through” entity by default. The company itself does not pay federal income tax. Instead, profits are taxed in the hands of the members. If the money remains in the company’s bank account at the end of the year, the IRS will tax LLC members on a personal level depending on the percentage of their equity in the LLC. For non-US residents, this is often very favorable: if the LLC earns income outside the US, it is usually not taxed in the US at all. However, reporting is still required. A foreign-owned single-member LLC must file Form 5472 every year, even if no tax is owed.
Taking Out Profits
Let’s look at how each structure allows you to move money from the company to yourself and what rules or taxes apply: A DOO restricts profit-taking to formal dividend payouts at the end of the year, while an LLC gives you more freedom to take profits to your personal bank account whenever you want. Let’s explore the comparison:
DOO: Profits must be formally declared and distributed as dividends before members can take them out. Dividend taxes apply when distributions are made. This means the process is structured and taxed at two levels.
US LLC: Members can take money out of the LLC at any time as distributions. Since the LLC itself does not pay federal tax, the only tax consideration is how distributions are treated in the member’s home country.
Compliance and Reporting
Every company has obligations, and both forms require you to keep proper books if you want to run the business professionally.
DOO: A DOO must file annual accounts, maintain proper bookkeeping, and sometimes undergo audits. Compliance is detailed and must follow local accounting standards.
US LLC: The compliance burden is much lighter. States typically require only a simple annual report and a small fee. For foreign-owned LLCs, the key federal requirement is Form 5472. Bookkeeping is not legally enforced in every state, but it is practically necessary to keep records clean and meet reporting obligations.
Administrative Burden and Costs
This is where many founders feel the difference; one structure is far easier (and cheaper) to maintain than the other. A DOO is more complex and costly to maintain; an LLC is simpler and less expensive, but you should still plan for professional accounting support.
DOO: Running a DOO usually requires ongoing costs: an accountant, payroll services if employees are hired, and various government fees. The bureaucracy is heavier and more expensive.
US LLC: An LLC is generally cheaper to run. Annual state fees vary from about $50 to $500. While you don’t need an accountant by law, it’s strongly recommended for clean books and tax reporting.
Access to Banking and Business Opportunities
Your company type affects which banks, payment processors, and markets you can reach; a DOO is the best solution for local markets, and a US LLC gives you global reach and credibility. Here’s how:
DOO: With a DOO, you gain access to local Balkan banks and, in some cases, connections to the EU banking system. However, global payment processors like Stripe or PayPal may still be limited.
US LLC: An LLC provides direct access to US banking, fintechs, and payment processors. This is often critical for online businesses and startups that need to accept payments internationally or raise money from investors.
Flexibility in Use
Depending on where you sell, operate, or store products, one structure may fit your business model much better.
DOO: Well-suited for businesses that operate locally. For example, trading companies, manufacturing, or services delivered in the Balkans. If you store your products locally, you sell in your own country only, or you have local employees, DOO makes more sense.
US LLC: Better for international operations, online services, SaaS companies, e-commerce, and holding structures for global founders.
If your focus is local, the DOO may be enough. If you’re going global, an LLC is almost always the better choice.
Similarities Recap
Despite their differences, DOOs and LLCs do share some common ground:
- Both provide limited liability protection.
- Both can be owned by one or multiple members.
- Both require some level of annual reporting to remain active.
Meaning, whichever structure you choose, you get personal asset protection and a recognized legal structure.
Differences
Here’s a comparison table between the two:
Conclusion
The DOO is a traditional and well-established option for businesses in Macedonia, Serbia, and the wider Balkan region. It works best if your operations are local and you expect to deal mostly with local banks, clients, and authorities.
The US LLC, on the other hand, is built for flexibility. It is simpler to form, easier to maintain, and often much more tax-efficient for non-US residents. It also opens doors to US banking, fintech solutions, and international opportunities that a DOO cannot easily match.
At Neubase, we help founders from the Balkans and beyond set up their US LLCs with full guidance on banking, compliance, and reporting so they can grow their business without unnecessary hurdles.
