Bosnia-Company formation
Bosnia and Herzegovina is a country known for its complexity. It is divided into different entities that offer special and unique benefits that have not yet been explored by foreign companies and investors. It is still one of the few countries in Europe where you will not encounter too many obstacles that have been set up by international institutions.
Limited Liability Company
Bosnian LLC (DOO) offers flexibility, low maintenance cost and great tax benefits that other European countries don’t have.
In case of bankruptcy, shareholders of LLC are not obligated to pay the company’s debt with their own assets.
Company Director or shareholder does not have to be a citizen of Bosnia and Herzegovina
Company can be opened remotely with Power of Attorney
Benefits of Bosnian LLC
- Founding capital 1 euro
- 0% dividend tax
- 10% corporate tax
- Time required for establishment 10 days.
- Only the basic documentation for the establishment is needed.
- It can be opened without the presence
- Director of LLC doesn’t need to be citizen of Bosnia and Herzegovina
Tax obligations and benefits
The main advantage is that the Bosnian LLC does not have to pay taxes on dividends. This provides an opportunity for business owners to withdraw dividends with 0% tax.
All income generated through company is subjected to 10% corporate tax.
The basis for the corporate tax is only the company’s net earnings. In other words, the corporate tax is only paid on the amount obtained when expenses are deducted from income.
Non-residents of Bosnia pay tax in accordance with Agreement on avoidance of double taxation. Often, the Agreement provide lower tax rates than 10%
Employees who are on special positions such as directors or sales managers, pay only 10% tax. This option gives you the ability to withdraw cash quickly and easily, without high cost
Export companies that are mainly engaged in production activities with headquarters in Bosnia are exempted from income tax in the double amount of income generated by exports.
Reduction of the tax base for the taxpayer, up to 50% of the taxable base, for the amount of investment in land, construction facilities, equipment furniture and means of transport for carrying out own activities in the territory of Bosnia.
Reduction of the tax base in the amount of paid gross wages of newly employed workers, as an incentive measure for employment to the taxpayer who employed new workers for an indefinite period in the tax year.
The possibility of submitting a consolidated tax return that is not time limited.
In case of bankruptcy, shareholders of LLC are not obligated to pay the company’s debt with their own assets.
Company registration cost
Our service package includes all government fees upon registration as well as services that will be of great help to you in the first few months.-
Power of attorney
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Government fees for registration
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Notarization fee
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Document translation
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Company seal
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Corporate bank account opening
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Personal bank account opening
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Receiving and forwarding E-banking
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One month of free address
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One month of free accounting
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Three months of assistance regarding bank and accounting communication
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Free consultations
What is required of you in order to register a company
a) Client should send a copy of passport, choose a business name, and come to Bosnia for 5 working days.
b) Establishment by power of attorney – if client can’t be present, he needs to sign and certify the power of attorney in the country where he is currently located and then send it to our address. With the help of a power of attorney, client won’t have to come to Bosnia until the bank account opening, which takes only 1 day. We do not charge extra for opening a company through a power of attorney since it is the most preferable option for many of our clients.
Process consists of several key stages:
- Preparation and notarization of documents
- Company registration in the Business Registry Agency
- Assistance when opening personal and corporate bank account
- Signing contracts for the office and accounting
Documents that are needed:
- Passport copy of shareholder/director
- Prof of address
- PoA in case of remote service
Corporate bank account
Together with the company, bank account is opened at the same time in order to enable your business functioning.
Banks in Bosnia are in the green zone. This means that your transactions with foreign countries will go through without frequent checks by banks and therefore the time required for money transfer will be much shorter.
You will get E-banking, which allows you to make payments through the app, giving you the ability to make transactions wherever you are.
Maintenance costs
Some of the main costs that companies have while doing business in Bosnia are accounting and address costs for their office.
Qualified accountant must be appointed so that the company can function properly.
Companies that have a minimum number of transactions, pay 60 euros per month.
Companies with an average number of transactions pay up to 150 euros per month.
Price of a company address starts from 100 euros.
Obligations after company formation
Maintaining the company requires constant communication with the bank as well as the accountant and state institutions. This is a problem for some clients, especially if they have several companies, as is often the case.
An obstacle can be represented by two things:
- If accountant does not understand English. This can be a difficulty when it is necessary to submit the documentation or to find out more about taxes
- Most forms as well as notices from banks and state institutions can only be found in Bosnian language
It is possible to achieve all this but it will take a lot of time.
If you want to be carefree and focus only on your business, you can request our Monthly Advisor service.
Our main job will be to:
- Coordinate with banks as well as government and tax authorities
- Provide legal and consulting services
- Inform you about upcoming obligations
Be free and let us know if you want this additional service. You choose the duration of the contract and you can also cancel the service at any time.
FAQ
Yes, all the taxes we have listed are legal and fully recognized by the state and are not loopholes.
In this case, you only have to pay for bookkeeping and office. If the company does not operate for a long period of time, the price can be negotiated and costs can be further reduced.
The taxes we have listed apply to almost all activities, so you can choose any activity that suits you the most.
Company can have 5 shareholders.
After opening, there are no hidden costs. The biggest costs are known to be accounting and office rent.
Yes, foreigners are allowed to register multiple companies.
Maximum is 3 months.
Yes, from start to finish whole process can be done remotely, but it is highly advised to be present when opening bank accounts.
Our principles of work
Information handling requires a responsible approach, so we always inform you in advance about the upcoming steps and documentation that is required, so you can plan your schedule and enjoy your time.
After the job is done, we don’t turn our backs on you and we don’t charge premium for further consultations.
Even for everyday challenges you stumble on you can always ask us for advice and we will be happy to assist.
Wish you luck and achievement of future plans! See you in Bosnia!
