Bosnia and Herzegovina
Register a D.o.
Foreign Ownership Eligibility
Bosnia and Herzegovina welcomes 100% foreign-owned companies
Fully remote formation — you never need to set foot in the country.
- 100% foreign ownership permitted — no local partner or Bosnian co-founder required
- Single-person company permitted — one foreign individual can be sole director and sole shareholder
- No mandatory local director — but a registered local address within BiH is required
- Minimum share capital: BAM 2,000 for FBiH D.o.o.; BAM 1 for RS D.o.o. (verify with RS Court Registry)
- Foreign shareholders' documents (passport, proof of address) must be notarised; apostille may be required depending on country of origin
- No restricted nationalities stated in BiH company law (verify for any active sanctions restrictions at the time of incorporation)
- Some regulated sectors — banking, insurance, defence — require special licensing beyond standard D.o.o. registration
Ownership
100% Foreign OK
Formation
100% Remote
Note
Registration can be completed without visiting Bosnia and Herzegovina — power of attorney to a local lawyer covers the Court Registry process. However, opening a corporate bank account requires a physical visit or an authorised local representative appearing in person. No major BiH bank offers fully remote corporate account opening for foreign-owned companies. Budget for an in-person visit or a local representative arrangement before committing to a setup timeline.
Tax at a glance
Bosnia and Herzegovina Tax Overview
10%
Corporate income tax — all three entities
Flat rate applies in FBiH, RS, and Brčko District. Standard rate, not a special incentive. Tax year = calendar year. ✅ PwC Tax Summaries, Feb 2026
17%
Value Added Tax (VAT)
Single standard rate — no reduced rates. Centrally administered by the Indirect Taxation Administration (ITA). Mandatory registration threshold: BAM 100,000 annual turnover. ✅ PwC Tax Summaries, Feb 2026
0%
Withholding tax on dividends — Brčko District
Non-resident dividend recipients pay 0% WHT in Brčko District. The lowest standard dividend WHT rate in Europe. ✅ PwC Tax Summaries, Feb 2026
5%
Withholding tax on dividends — FBiH
Non-resident dividend recipients in the Federation of Bosnia and Herzegovina. Reducible under applicable DTTs. ✅ PwC Tax Summaries, Feb 2026
10%
Withholding tax on dividends — Republika Srpska
Non-resident dividend recipients in Republika Srpska. Reducible under applicable DTTs. ✅ PwC Tax Summaries, Feb 2026
10%
Withholding tax on interest and royalties
Applies equally across all three entities for non-resident recipients. Reducible under applicable DTTs. ✅ PwC Tax Summaries, Feb 2026
10%
Personal income tax — FBiH and Brčko District
Flat rate. RS applies 8% flat PIT (small entrepreneurs: 2% on total annual revenue). ✅ PwC Tax Summaries, Feb 2026
30+
Double tax treaties in force
Including Germany, France, UK, Austria, Netherlands, Sweden, Norway, UAE, Turkey, Poland, Romania, Serbia, Croatia, Malaysia, and Qatar. Full list at the BiH Ministry of Finance. ✅ PwC Tax Summaries, Feb 2026
31 Mar
Corporate income tax return deadline
Annual CIT return due 31 March for FBiH and RS (prior calendar year). Brčko District deadline: 30 April. Loss carry-forward: 5 years (FBiH and RS).
Pros & cons
Advantages & Considerations
Key Advantages
10% flat corporate income tax applies in all three entities — FBiH, Republika Srpska, and Brčko District. This is the standard rate for every company in BiH, not an incentive or special zone. One of the lowest CIT rates in Europe. ✅ Verified: PwC Tax Summaries, Feb 2026.
Brčko District imposes 0% withholding tax on dividends paid to non-residents — the lowest dividend WHT rate in Europe at the standard rate. Profit repatriation from a Brčko District D.o.o. carries no dividend tax at source. ✅ Verified: PwC Tax Summaries, Feb 2026.
No capital gains tax regime. Capital gains are included in ordinary income and taxed at the standard 10% CIT rate. There is no separate CGT calculation, no CGT filing, and no higher rate on asset disposals. ✅ Verified: PwC Tax Summaries, Feb 2026.
No Controlled Foreign Corporation (CFC) rules in any of the three entities. Relevant for holding structures with non-BiH subsidiaries — BiH imposes no anti-avoidance charge on undistributed foreign profits. ✅ Verified: PwC Tax Summaries, Feb 2026.
Single 17% VAT rate — no reduced rates, no multiple bands, no complex classification rules. The Indirect Taxation Administration (ITA) administers VAT centrally for all of BiH. The simplest VAT system in Europe for compliance purposes. ✅ Verified: PwC Tax Summaries, Feb 2026.
BAM–EUR currency peg at a fixed 1.955830 BAM = 1 EUR, backed by a currency board arrangement in force since 1995. This provides de facto Euro exchange rate stability for financial planning and cross-border transactions, without formal EU membership.
100% foreign ownership permitted — no local partner requirement. A single foreign individual or foreign company can own 100% of a BiH D.o.o. with one foreign director. ✅ Verified: BiH Company Law.
EU candidate country since December 2022, with a Stabilisation and Association Agreement (SAA) already in force. The SAA provides preferential access to EU markets for BiH-incorporated companies ahead of full accession.
CEFTA membership provides preferential trade access to 6 additional Western Balkans markets: Albania, Kosovo, Moldova, Montenegro, North Macedonia, and Serbia. Combined with the SAA, a BiH company has preferential trade access to both the Western Balkans and the EU.
30+ double tax treaties in force with major investment source countries, including Germany, France, UK, Austria, Netherlands, Sweden, Norway, UAE, Turkey, Poland, Romania, Serbia, Croatia, Malaysia, and Qatar. DTT rates reduce withholding tax on dividends, interest, and royalties. ✅ Verified: PwC Tax Summaries, Feb 2026.
Low labor costs — average gross salary in BiH is among the lowest in Europe (approximately €700–1,000/month; verify current data). Social security contributions are structured with lower employer burdens in RS compared to FBiH.
Low total setup cost — a standard D.o.o. in FBiH can be fully incorporated and operational for approximately BAM 3,000–6,000 (~€1,500–3,000), including minimum share capital, notary fees, and registration costs.
Considerations
Three separate tax and regulatory jurisdictions — FBiH, Republika Srpska, and Brčko District — each with different personal income tax rates, dividend WHT rates, social security structures, and administrative deadlines. Companies operating across entities face genuine compliance complexity.
Banking requires physical presence. No major BiH bank currently offers fully remote corporate account opening for foreign-owned companies. An in-person visit or a local authorised representative with notarised power of attorney is required. Plan for 5–15 business days for account activation after registration.
Not yet an EU member. EU candidate status was granted in December 2022; full accession is a medium-to-long term prospect. BiH companies do not benefit from the EU financial services passport, EU procurement rules, or EU regulatory harmonisation.
Slower administrative processes compared to EU member states. E-government services and Court Registry digitalisation lag behind regional peers. Bureaucratic delays are common and increase the total setup timeline beyond the theoretical minimums.
Small domestic market of approximately 3.2 million people (verify; ongoing emigration reduces the effective working-age market further). BiH is viable as an export base or holding structure jurisdiction, but not primarily as a consumer market play.
BAM is pegged to the Euro but is not the Euro. The theoretical risk of peg abandonment — while historically remote and legally constrained by the currency board arrangement — is not zero. Foreign investors should note this distinction when assessing currency risk.
Structural Comparison
D.o.o. — Društvo s Ograničenom Odgovornošću (LLC)
D.d. — Dioničko Društvo (Joint Stock Company)
Branch Office (Podružnica / Ogranak)
Incorporation Process
The process is strictly digital. Each stage builds on the previous one.
Free consultation with XBandGlobal specialists to confirm the right entity and jurisdiction: FBiH D.o.o. (Sarajevo-based, BAM 2,000 capital), RS D.o.o. (Banja Luka or eastern BiH, lower capital), or Brčko District D.o.o. (0% dividend WHT). Sector restrictions and dividend repatriation strategy reviewed at this stage.
Check company name availability with the relevant Entity Court Registry (FBiH Court Registry or RS Court Registry). Name reservation confirms availability and prevents competing registrations while documents are prepared.
Prepare incorporation documents: Articles of Association (Statut or Ugovor o osnivanju), director and shareholder details, registered office address. Foreign shareholders' documents must be notarised and, where required, apostilled.
Arrange notarisation of Articles of Association before a BiH notary. This is a mandatory step — the Articles of Association must be notarized before submission to the Court Registry. XBandGlobal's local partners coordinate this.
Deposit the minimum share capital (BAM 2,000 for FBiH D.o.o.) into a temporary bank account. Proof of capital deposit is required for the Court Registry submission.
What you'll pay
Cost Architecture
Government Fees
Annual Ongoing
Professional Services
Government registration fees in Bosnia and Herzegovina are low — Court Registry and notary costs total approximately BAM 500–1,100. The real cost drivers are the minimum share capital (BAM 2,000 — equity you retain, not a fee), notarisation of foreign documents, and the requirement for an in-person bank visit. Annual compliance (accounting, registered address) runs BAM 4,000–10,000/year (~€2,000–5,000/year) for a lean D.o.o. without employees. Factor this into your first-year operating budget.
Still unsure about costs?
These are estimates — your actual cost depends on your structure
Every Bosnia and Herzegovina setup is different. A 15-minute call with one of our specialists will give you a personalised cost breakdown — completely free.
Fintech & Banking
Can non-residents open accounts without visiting? NO.
Banking options for non-resident founders in Bosnia and Herzegovina. Remote account opening availability varies by institution.
| Institution | Type | Ease for Non-Residents | Notes |
|---|---|---|---|
| Raiffeisen Bank BiH | International (Austrian parent) | Low (Visit Required) | Largest bank by assets in BiH. Strong international corporate banking capabilities — well suited to foreign-owned companies with cross-border transaction needs. In-person KYC required for new corporate accounts. Extensive AML/KYC documentation expected. |
| UniCredit Bank d.d. | International (UniCredit Group) | Low (Visit Required) | Part of the UniCredit Group. Widely used by foreign-owned entities and subsidiaries of European corporates. SEPA-adjacent capabilities through parent network. Physical visit required for initial account opening. |
| NLB Banka | International (Slovenian parent) | Low (Visit Required) | Suitable for SMEs and foreign-owned businesses. Slovenian parent provides access to broader CEE banking infrastructure. In-person visit required. KYC documentation: certified incorporation documents, beneficial ownership declaration, director and shareholder passports. |
| Sparkasse Bank | International (Austrian-linked) | Low (Visit Required) | Solid service for SMEs and foreign-owned D.o.o. companies. Austrian institutional backing provides familiarity for European founders. In-person opening required. Verify current minimum deposit requirements directly with the bank. |
Frequently Asked
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