This post provides a detailed overview of the individual income tax framework in Bosnia and Herzegovina for 2025. All information below is based on currently available data and focuses exclusively on the regulations and rates applicable to individuals for this tax year.
Overview of Individual Income Tax in Bosnia and Herzegovina
Bosnia and Herzegovina employs a straightforward flat tax system for individual income. All taxable personal income is subject to a single fixed tax rate, which makes the process more predictable compared to many jurisdictions that utilize progressive tax bands.
Tax Structure and Main Features
For 2025, Bosnia and Herzegovina applies a flat tax on income earned by individuals. There are no progressive brackets or additional surtaxes reported for this period. This approach means that all income, regardless of amount, is taxed at the same rate.
| Assessment Basis | Tax Rate (%) | Currency (BAM) |
|---|---|---|
| Personal Income | 10% | BAM |
This flat rate creates transparency for taxpayers and simplifies compliance requirements. No minimum or maximum holding periods apply for income sourced domestically or abroad, nor are there requirements for calculating surtaxes under current law.
Key Details for 2025
- Tax Type: Flat rate
- Applicable Rate: 10% of all qualifying personal income
- Applicable Currency: Convertible Mark (BAM). As of January 2025, 1 BAM ≈ 0.55 USD.
- Tax Brackets: Not applicable
- Surtaxes: None reported
For international comparisons: if an individual earns 50,000 BAM in 2025, their total tax liability would be 5,000 BAM (about $2,750 USD at the referenced exchange rate).
Flat Tax Table: Bosnia and Herzegovina Individual Income Tax, 2025
| Taxable Income (BAM) | Flat Tax Rate (%) | Tax Due (BAM) | Tax Due (USD, at 0.55) |
|---|---|---|---|
| 10,000 BAM | 10% | 1,000 BAM | $550 |
| 30,000 BAM | 10% | 3,000 BAM | $1,650 |
| 50,000 BAM | 10% | 5,000 BAM | $2,750 |
| 100,000 BAM | 10% | 10,000 BAM | $5,500 |
The absence of tiered brackets or additional rates means taxpayers can easily calculate their annual tax obligations by applying the flat 10% rate to their total taxable income.
What Is Subject to Tax?
The tax applies to total qualifying income for individuals, though the precise categories of taxable and exempt income may be further detailed by Bosnia and Herzegovina tax authorities. For specific definitions of taxable income types or current guidance, consult the official site at porezna-uprava.gov.ba.
Pro Tips for Efficient Taxation in Bosnia and Herzegovina
- Always document all sources of income carefully—Bosnian tax authorities will request supporting evidence for declarations.
- Check for exemptions or deductions that may apply under current law, as these can vary year to year.
- Keep up to date with government publications, as income definitions or filing requirements can evolve unexpectedly.
- If you have international income or foreign assets, verify their treatment with a local advisor as cross-border taxation is subject to specific rules.
Where to Find Official Information
For further details and updates, always refer directly to the Bosnia and Herzegovina Tax Administration’s homepage: porezna-uprava.gov.ba.
In summary, Bosnia and Herzegovina’s flat 10% personal income tax for 2025 creates predictability and simplifies the compliance process for both residents and non-residents. The absence of progressive brackets or surtaxes limits unexpected tax liabilities, while the clear assessment basis allows straightforward calculation of obligations. Individuals are still encouraged to verify income categories and potential exemptions to optimize their tax position in a careful, compliant way.