Payroll in BiH 2026 — Complete Guide for Employers

All contribution rates, calculation steps and legal obligations for employers in FBiH for 2026. Practical guide with worked calculation example.

Last January, a company in Sarajevo received a penalty of 4,200 BAM due to a single error in the MIP form — a field most owners have never even opened. Every mistake in payroll directly affects employees' rights, your finances and your relationship with the FBiH Tax Administration.

Why Accurate Payroll is Critical

A payroll error is not just a financial penalty. It is broken employee trust, a potential lawsuit before the labour court and possible freezing of the company's bank account. The FBiH Tax Administration has the legal right to inspect salary payments without prior notice, for a period of up to five years back.

Contribution Rates in FBiH for 2026

From employee (from gross salary):

Pension and disability insurance (PIO/MIO): 17%
Health insurance: 12.5%
Unemployment insurance: 1.5%
Total from employee: 31%

From employer (on gross salary):

Pension and disability insurance: 6%
Health insurance: 4%
Unemployment insurance: 0.5%
Total from employer: 10.5%

Practical Calculation Example

For a NET salary of 1,000 BAM:

Gross salary: approximately 1,587 BAM
Income tax (10% after personal deduction): ~158 BAM
Employee contributions (31%): ~492 BAM
Employer contributions (10.5%): ~167 BAM
Total employer cost: approximately 1,754 BAM

ENS d.o.o. — Payroll Processing in Sarajevo

ENS d.o.o. takes over the complete payroll process: calculation, payslips, MIP form submission and all Tax Administration reporting. Contact us: +387 61 158 271