Bosnia and Herzegovina comprises two autonomous entities: the Federation of Bosnia and Herzegovina and Republika Srpska. Each has its own laws and regulations, so opening a company is also a bit different. We have gathered all the important information you need in order to start a business in either part.
Disclaimer: Be aware that this article is not a substitute for legal advice. Please always check official websites or seek legal advice before you take action.
Registration process for sole traders in the Federation of Bosnia and Herzegovina
The decision on the registration is made by the department of economy of the city or municipality, the so-called registration authority, based on the following documentation:
- Qualification required for performing the activity
- Certificate of citizenship
- Certificate of legal capacity
- Health insirance
- Certificate of the Court of General Jurisdiction - proving that the natural person has not been issued a ban on performing the requested activity
- Certificate of the Tax Administration - which proves that the person has no unpaid tax obligations
Registration process for sole traders in Republika Srpska
The documents required for sole traders who want to register in Republika Srpska are the following:
- Completed form for registration of entrepreneurs SP-1
- Certified copy of ID card - certified in the municipality office, with a fee of 2 KM
- Certificate of the Court of General Jurisdiction
- Certificate of the Tax Administration
- Contract on the Establishment of Partnership - only if the founders are two or more natural persons; certified by a notary
- Proof of payment of the registration fee - maximum of 30 KM
Making a business stamp
After providing the mentioned documents for inspection, the registration authority is obliged to make a decision on the registration within two days, if all the documentation is correct.
Upon receiving the decision, the proprietor has to make a business stamp, which costs between 20 and 50 KM.
Submitting documents to the Tax Administration
Within five days from the day of issuing the decision, the sole proprietor is obliged to submit these documents to the Tax Administration:
- Decision on registration
- Certified copy of ID card
- Bookkeeping agreement - if the proprietor does not keep the business books themselves
The last step is opening a designated business bank account. To open the bank account, you will need the following documents:
- Decision on registration
- Taxpayer registration certificate
- Fiscalization (costs around 600-700KM)
- VAT registration (if the turnover is less than 50 thousand KM, the sole trader does not have to register in the VAT system, although they can do so voluntarily. The application fee for this system is 15 marks.)
Benefits of using Deel
Relying on Deel to manage the contractors you decide to hire will help you get your “sole proprietor” off on the right foot. Our experienced teams work towards providing you the most streamlined contractor experience. With Deel, you can:
- Have a centralized platform that takes care of all the documentation, such as contracts, invoices, and compliance documents.
- Manage payments in different currencies and withdraw with a payment method of your choice (SEPA, PayPal, Payoneer, or bank transfer).
- Get 24/7 access to customer support and a team of experts.