According to a decision which entered into force on July 1 2015, for the period 2015-2017, VAT taxpayers will be classified as large taxpayers if their total annual amount of VAT (sum of input and output VAT) is equal to or exceeds 1.5 million BAM ($870,000). Furthermore, compliance audits of large VAT taxpayers will be carried out at the indirect taxation premises.
On March 7 2016, the income and capital tax treaty concluded between BiH and Poland entered into force. Per the Treaty, the withholding tax charged on dividends shall not exceed 5% of the gross dividend amount in case of 25% participation, or 15% of the gross amount in all other cases. Regarding withholding tax on interest, the treaty stipulates a tax rate of 10% and the same rate has been set for withholding tax on royalties.
To prevent double taxation, BiH will allow a deduction from taxes in amount equal to the tax paid in Poland (not exceeding the amount of taxes calculated in BiH before such deduction is granted).
The amended law on property tax in the RoS entered into force on January 1 2016.
The most significant change introduced with the amendments is the decrease of the maximum property tax rate. The Law authorises municipal assemblies to determine the annual tax rate on a municipality basis, as well as in accordance with the following regulations:
Property used for educational, scientific, social, health and sport purposes is no longer exempt from property tax. On the other hand, property built exclusively for further sale is excluded from taxation as of January 2016.
The tax base for property tax is the market value of the land and buildings, which is – per the legislation – estimated by municipalities and corrected by the tax administration of the RoS.
Effective January 1 2016, a new profit tax law is in force in the RoS.
The amended law introduced the following novelties:
The new profit tax law in the Federation of BiH entered into force on March 5 2016.
Some of the most significant amendments in the new law include:
Dajana Topic (firstname.lastname@example.org), Eurofast GlobalTel: +387 51 961 610
|Corporate Income Tax||10%|
|Capital Gains Tax||10%|
|Net Operating Losses (years)|
|Branch Remittance Tax||0%|
|Royalties from, for example, patents, know-how||10%||C|
A Dividends paid to a non-resident are subject to a 5% withholding tax unless the rate is reduced under a tax treaty.
B Interest paid to a non-resident is subject to a 10% withholding tax unless the rate is reduced or the payment exempt from withholding tax under a tax treaty.
C Royalties paid to a non-resident are subject to a 10% withholding tax unless the rate is reduced under a tax treaty.
D Capital losses can be carried forward for five years against capital gains.
Tel: +387 51 335 100
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