If you want to start a business in Bosnia and Herzegovina, you have to know about taxation for a LLC (DOO) which is the most common company type in Bosnia and Herzegovina.
Bosnia and Herzegovina taxes income on a worldwide basis. The established percentage for offshore income, from our research, and your results may vary, is 10%. Bosnia and Herzegovina does not have known exemptions to bring in offshore income made internationally. Taxes are quite low in Bosnia and Herzegovina as the rate which a LLC (DOO) will pay tax is 10%. This ranks Bosnia and Herzegovina as 31st overall with regards to corp. taxation rate internationally.
The valued added tax rate in BA is 17.00%, that ranks Bosnia and Herzegovina as 109th overall with regards to value added tax rate worldwide. In terms of other taxation, an employer will contribute 10.5% to the equivalent of a social security fund and an employee will contribute 31%. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 81hours. Contributing to this is the number of yearly labor tax payments, which is 11 in BA.
Thin capitalization standards are in force. Thin capitalisation refers to any sort of laws on companies' debt-to-asset ratios. Dividends received from a resident entity are tax-exempted. Dividends from foreign entities are usually subject to CIT, but foreign tax expenses may be credited against total tax liability. A dividend is a payment of a company profit, decided by the board of directors, to a particular class of shareholders. Dividends can be either stock, cash, or property. Capital Gains are included in Corporate Income Tax base. A capital gains tax is levied on the profits that a corporation or natural person realizes when he or she sells sells a capital asset for a price that is higher than the purchase price.
The interest withholding tax rate is estimated at 10%. This means that the tax authorities expects LLC (DOO)'s to withhold 10% of interest payments made to non-residents. The dividends withholding tax rate is 5%. This should be interpreted that usually the relevant tax authorities expects LLC (DOO)'s to pay 5% tax of dividend payments to non-residents. The royalties withholding tax rate is 10%. This means that the relevant tax authorities expects legal entities to pay 10% tax of royalty payments remitted abroad. Taxes may be reduced or exempted under a tax treaty.
There is no known tax on wealth in Bosnia and Herzegovina. There are inheritance, transfer and real property taxes in Bosnia and Herzegovina. We are not aware of any frequently implemented R&D initiatives that provide tax relief in this country.
The above is not tax or legal advice for your individual facts and circumstances. We are able to to point you to a tax advisor in Bosnia and Herzegovina who can help you. Want to work together? Click incorporate now if you are in a hurry, or press the free consultation button above.
It takes approximately 68 hours to file and prepare documents for a Bosnia and Herzegovina Civil Law.
The corporate tax is approximately 10% which is 35 in the world.
Owners of a company in Bosnia and Herzegovina are not allowed to carry back a loss and may be allowed to carry forward a loss for 5 years.
The vat rate in Bosnia and Herzegovina is 17% which ranks 109 in the world.
Thin capitalization rules are in effect. A company is thinly capitalised when there is a greater proportion of debt than equity. The minimum capitalization for a Bosnia and Herzegovina Civil Law is 2,000.
A corporate director is permitted, meaning this country is a good option if you are setting up a structure where you want to protect director liability.
The directors are disclosed in the public registry of Bosnia and Herzegovina, Registar poslovnih subjekata (Registers of Business Entities in Bosnia and Herzegovia). Shareholders are not disclosed in the Registar poslovnih subjekata (Registers of Business Entities in Bosnia and Herzegovia).
Typically companies take 7 weeks to setup and there are 1 director(s) required and 1 shareholder(s) required at the time of incorporation.
Overall we think Bosnia and Herzegovina is a good option and have given it a score of 73 as an IO score, using the Incorporations.IO proprietary formula.
We can help you form a company in Bosnia and Herzegovina. Click the button above for a no-obligation quote. We will provide you with all the necessary documents to open a bank account as well as a registered office in Bosnia and Herzegovina, which is required by law.
We can help you with your incorporations needs for an initial payment of just $1000.
Easy Step by Step Process:
The standard process typically takes between two (2) to three (3) weeks depending on when we receive all the required information from you. Once we receive your information, we will email you a complete set of documents for your review within 3 working days upon confirmation of payment. After executing the documents, you will need to mail them to us and we will formally submit your application for filing with the Registry. The Registry will then take about 3-8 working days to process the incorporation and produce certificates necessary for opening your bank account.
Applying for Your Bank Accounts:
Incorporations.IO maintains close working relationship within our extensive network of partner banks to help you apply for and receive banking services that are most appropriate to your specific situation. From the time of verification of incorporation it can take (1) one week to (2) two weeks to apply for and receive a bank account. We work primarily with banks that allow for remotely opened accounts to ensure you are ready to do business as soon as possible.
Applying for Payment Processing:
We include introductions to payment processors or merchant accounts with all of our incorporation services. Whether you just need standard credit card processing or specialized services for high risk processing, we have partners that can assist you and are happy to help you with introductions that can empower your business.
Start Online or via Phone:
We can get started for you whenever you are ready via a US$1000 initial payment via credit card. I get notified whenever a payment is made here and would send out the welcome letter and initial forms we would need within 12 hours. If you prefer, we can also process via a phone or Skype call.
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