What is the procedure for obtaining a building permit?
If the investor wants to execute next work:
· Construction of the building;
· Reconstruction of the building;
· Upgrading facilities (adding floors to the top of an existing object);
· Other ex-works on the existing building;
· Changing the purpose of the facility (eg. changing the purpose from a residential to a business facility);
· Construction of transport, communal and energy infrastructure or their part.
Getting 3 documents would allow them to proceed:
· I – Urban permit
· II- Building permit
· III- Exploitation permit
How can an investor transfer capital from abroad to BiH?
The granting of loans to a company by its founders is regulated by the Companies Act.
A member of the company or a related person may, without fulfilling any special pre-requisitions, make a limited liability company at any time, with the conclusion of a loan agreement. The founder makes a loan to the company’s current account and subsequently disposes of borrowed funds. Whether the loan will be given without interest or with a certain interest, is the subject of a contract between the founder and the company.
The Company returns the loan when the financial conditions are met.
Borrowings which the company is not able to return to the founder may be converted into equity. Increase of capital is carried out in accordance with the Law on Business Companies and is obligatorily applied to the Ministry of Finance.
How can I get a temporary stay in BiH?
Q: How much a foreigner can stay in BiH on the basis of a visa-free regime?
A: Visa free stay is the right to stay in BiH for foreigners coming from visa-free countries in a total of up to 90 days in any 180-day period, which involves taking into account the 180-day period preceding each day of residence, unless otherwise determined by international contract, where BiH is a contracting party.
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Q: Is a foreigner who wants to stay in BiH on the basis of a visa-free regime obliged to register his stay in BiH?
A: An foreigner who does not use the accommodation services of legal, and natural persons providing accommodation services or a natural person who a foreigner is visiting, is obliged to report to the competent organizational Service or the police, the residence of a foreigner in BiH within 48 hours of the foreigners entry into BiH, if a foreigner in BiH stay for more than three days.
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Q: What are the obligations of foreign citizens who want / intend to work in BiH?
A: If a foreigner intends to stay in BiH for the purpose of paid work, he must have a work permit issued by a body competent for employment of foreigners, unless this law or an international agreement stipulates that a work permit is not required for certain types of work. Upon obtaining a work permit, an foreigner applies for a temporary residence permit in BiH without which he can not work in BiH.
Q: How much is a temporary residence permit in BiH?
A: The temporary residence permit can be issued for a period of up to one year, provided that foreigner has entered BiH legally and meets the general requirements for the approval of residence.
Q: Stay in BiH without a residence permit?
A: Any foreign citizen without regulated residence in accordance with the laws of BiH, is considered an illegal migrant who is ultimately threatened by deportation from Bosnia and Herzegovina with a pronouncement of a ban on entry to BiH for a minimum of one to five years. A foreigner shall be fined in the amount from 300 KM to 1500 KM if he resides in BiH longer than the time specified in the visa or in the temporary residence permit, or longer than the validity of the visa-free stay.
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Q: What are the conditions for granting permanent residence to foreign nationals?
A: The granting of permanent residence to foreign nationals may be granted to a foreigner under the following conditions:
• Based on the temporary residence permit, he resides on the territory of BiH for at least five years before submitting a request for permanent residence permit. Interruption of stay is not considered as a stay of a foreigner outside BiH for up to 90 days in the period of one year during the granted temporary stay in BiH;
• has sufficient and regular means of subsistence;
• has adequate accommodation;
• has health insurance;
At the time of filing the application and deciding on a request for a permanent residence permit, a foreigner must have an approved temporary stay in BiH (sixth temporary stay).
Tax system in BiH?
Basic tax categories:
– Value-added tax
– Profit tax
– Income tax
– Property tax
– Social security contributions paid by the employer and employee,
TAX RATING CATEGORIES
Value Added Tax 17% (FBiH, RS, BD)
Profit tax 10% (FBiH, RS, BD)
Income Tax 10% (FBiH, RS, BD)
Foreigners and Taxes in BiH
All foreigners resident in the Federation of Bosnia and Herzegovina and the Republic of Srpska pay the tax on revenues generated in the calendar year on the territory of BiH. Similarly, all foreigners who do not have residence in BiH but who earn income in the Federation of BiH and the Republic of Srpska are considered taxpayers.
In the Brčko District, foreigners are treated as taxpayers if they they hahve resiedence in the territory of the Brčko District for an uninterrupted period of 183 days.
What is the real estate sales tax?
The tax rate varies at the level of entities in BIH so:
• In FBiH, the real estate tax rate is 5%,
• in RS, the real estate tax rate is 3%.
Is it possible to include more co-owners in the company in BiH?
Yes, it is possible to add new co-owners in the company.
What personal documents are needed to open a company in BiH?
Only document that is required is a passport.
What is the best way to open a company in BiH?
D.o.o. translated in English is the limited liability
company (LLC), or the German – Gesellschaft mit beschränkter Haftung (GmBH), is
a company in which each member of the company has a share in the capital of the
company and bears the risk of doing business only up to the amount of that
share. It is a business structure established by a foundation document or a
founding contract with one or more domestic / foreign natural and / or legal
entities and with initial capital divided into parts.
Therefore, the responsibility for doing business is
limited, so the founder or more of them do not meet the obligations of the
company with their personal assets, but only for the amount of the share. This
characteristic makes d.o.o. (LLC, GMBH, in further text d.o.o.) one of the most
common forms of a commercial company in Bosnia and Herzegovina.
The basic and most important document for d.o.o. is its
founding act.
The founding act may be in the form of a decision (if there
is one founder) or in the form of a contract (if there are several founders).
Registration is done with the department of the register
for registration of legal entities.
Data entered in the register are data about
establishment, merger and termination of the subject of registration,
establishment or termination of part of the subject of registration, all status
changes that include changes in the form of organization of the subject of
registration, information on the subject of registration which are relevant for
legal correspondence and their changes, data on bankruptcy and liquidation of
the process, data on the initiated procedure of termination of the enrollment
subject as well as other legally prescribed data.
For registration, it is necessary to provide the
following documentation (translation of the documentation with an authorized
court interpreter in one of the official languages in Bosnia and
Herzegovina):
– Requests for registration (forms can be downloaded in
court, or on the court page);
– Founding act;
– Evidence of payment for the founding capital to a
temporary account in a bank;
– Proof of payment of court fee and the receipt of
payment of fee for publishing the advertisement for the establishment of a
company in the Official Gazette of the FBiH, or the Official Gazette of the
Republic of Serbia (Službene novine FBIH ili Službenom glasniku RS);
– Receipt from the tax administration office about
non-existence of debt;
– The signature of the person authorized to represent
the company in the internal and external business;
– The statement of the director on the acceptance of the duty.
Can a foreign investor buy a property on his behalf in Bosnia and Herzegovina?
Foreign person acquire the
right to own property in the Federation BIH (FBIH) under the condition of
reciprocity, except when the right is acquired by inheritance, unless otherwise
provided by law or by international contracts. The list of countries where
there is no reciprocity is published by the Federal Ministry of Justice, with
the previously obtained opinion of the Ministry of Foreign Affairs of Bosnia
and Herzegovina, every year by January 31st at the latest”, states Article
2 of the Law on Real Rights of FBiH.
The concept of reciprocity implies that foreigners in BiH have the same
rights, as the state they come from, guarantees to BiH citizens. The
reciprocity system is considered fair because it puts foreigners and BiH
citizens in the same position.
According to the last available list on the website of Federal Ministry
of Justice, citizens of the following countries may become owners of real
estate in FBiH due to the existence of reciprocity: Andorra, Belgium,
Montenegro, Estonia, Finland, France, Greece, the Netherlands, Ireland, Italy,
Japan, South Korea, Canada, Macedonia, Monaco, Norway, New Zealand, Germany,
Serbia, Spain, Great Britain and Uzbekistan.
BiH has a reciprocity with a number of countries, but under special
conditions, on the basis of which the scope and duration of ownership of real
estate of BiH citizens in these countries and also foreigners from those states
in FBiH is limited. This group of countries includes the following: Algeria,
Austria, Australia, Belarus, Bulgaria, Czech Republic, Denmark, Georgia,
Croatia, Iran, Iceland, Israel, Iodine, Kazakhstan, Cyprus, Hungary, Malaysia,
Romania, Russia, Saudi Arabia, USA , Syria, Slovakia, Sweden, Switzerland,
Turkey, Turkmenistan and Tajikistan.
Ultimately, citizens of the following countries are not able to acquire
ownership of real estate in FBiH as natural person because of the lack of
reciprocity: Afghanistan, Armenia, Bahrain, Egypt, India, Indonesia, Iraq,
Qatar, Kuwait, Lebanon, Slovenia and United Arab Emirates.
What is the difference between a real estate agent and a real estate broker?
Most states require real estate sales professionals to be licensed by the state, so that they can control education and experience requirements and have a central authority to resolve consumer problems.
The terminology used to identify real estate professionals varies a little from state to state. Brokers are generally required to have more education and experience than real estate salespersons or agents.
The person you normally deal with is a real estate agent or salesperson. The salesperson is licensed by the state, but must work for a broker. All listings are placed in the broker’s name, not the salesperson’s.
A broker can deal directly with home buyers and sellers, or can have a staff of salespersons or agents working for him or her.
Why should I use a real estate salesperson?
A real estate salesperson is more than just a “sales person.” They act on your behalf as your agent, providing you with advice and guidance and doing a job – helping you buy or sell a home. While it is true they get paid for what they do, so do other professions that provide advice, guidance, and have a service to sell –such as Certified Public Accountants and Attorneys
The Internet has opened up a world of information that wasn’t previously available to homebuyers and seller. The data on listings available for sale is almost current – but not quite. There are times when you need the most current information about what has sold or is for sale, and the only way to get that is with an agent.
However, the role of an agent has changed in the last couple of years. In the past, agents were the only way home buyers and sellers could access information. Now agents are evolving. Because today’s home buyers and sellers are so much better informed than in the past, expertise and ability are becoming more important.
The real estate agent is becoming more of a “guide” than a “salesperson” — your personal representative in buying or selling a home.
I have a family friend who is a Realtor. I like her and she is a help but she gives me one price to sell my home for and I think it is too low. So I called another agent who suggested a price more in line with my expectations. Who do I choose?
You might want to consult a couple more Realtors on the market value of your home. Most of the estimates should be in the same ballpark.
It could be that your friend is being more honest with you about the value of your home and the other Realtor gave you a higher number because he already knew you expected it. This is called “Buying a Listing” and is the subject of an article on our web site.
Or it could simply be that your friend is a good friend, but not that great of a real estate agent.
Mixing business and friendships is always risky to the friendship. On the other hand, if your friend is truly competent and was providing wise advice, she may be offended if you ignore the advice and choose another agent.
I have to make a choice between an updated home in an older neighborhood or a newer home in a more modern neighborhood. The home in the older neighborhood has almost everything I want and is much larger, but which makes the most sense as an investment?
If your goal is to buy a home for it’s resale value and the one you are thinking of buying in the older neighborhood is at the upper end of values for that neighborhood, then it may not be the wisest choice. If it is similar or lower in price to the others, then there should be no problem, because pricing should be considered in relation to the local neighborhood and not compared to homes in other neighborhoods (for the most part)
Plus, is it a neighborhood on the decline, or are others going to be fixing things up, too, so that it is a neighborhood that is improving? It could turn out to be a very good deal as long as you don’t “overpay” because of the recent improvements.
Remember that you also buy a home for it’s value to you as a “home,” and that is something else you should consider. Which neighborhood would you AND your family feel most comfortable in?
When buying a new home, what upgrades should we go for? What holds the most value? Do we upgrade the lot? Pick more square footage in the house? Add an extra bedroom?, etc.
A lot depends on why you are buying the house. Are you buying it mostly as a home or mostly as an investment? There is a difference.
For the most part, upgrades are high-profit items for builders. They aren’t designed to enhance the value of the house, but make you happier with the house you do buy.
If you are looking at your home as an investment, then you buy from the smaller to medium size in the tract and spend only a minimal amount on upgrades. If you are looking at your purchase as a home, then you select upgrades that will enhance your quality of living.
One rule of thumb is to always upgrade the carpet and padding.
