VAT in BiH — Everything You Need to Know as a Business Owner in 2026

Who must be in the VAT system in BiH, how the calculation works and what happens if you file late. Guide without jargon.

Last year in BiH, over 12,000 penalties were issued for VAT irregularities — and most of those companies had an accountant. VAT in BiH is not complicated if you understand the basics, but it is unforgiving to those who ignore them.

How VAT Works

VAT (Value Added Tax) is an indirect tax that you collect from your customers and pass on to the state. You are the intermediary between the buyer and the state budget.

The standard VAT rate in BiH is 17%. Every time you issue an invoice to a customer who is not in the VAT system, you add 17% to the price and collect that amount. That money is not yours — you must pay it to the Indirect Taxation Authority (ITA) of BiH. You have the right to deduct VAT you have paid your suppliers (input VAT), which reduces your debt to the ITA.

Who Must Register for VAT?

Mandatory VAT registration occurs when your taxable turnover reaches 50,000 BAM in the previous 12 calendar months. Voluntary registration is possible at any time.

VAT Return Deadlines

• Monthly filers: by the 10th of each month for the previous month
• Quarterly filers: possible with ITA approval for lower-turnover businesses
• Penalty for late filing: financial penalty + default interest

KUF and KIF Books

Every VAT payer must maintain:

• KUF (Book of incoming invoices) — records all supplier invoices
• KIF (Book of outgoing invoices) — records all customer invoices

ENS d.o.o. maintains these records and handles all VAT filings for our clients. Contact: +387 61 158 271