No Delays in Payment of VAT in Bosnia and Herzegovina


Having in mind the fact that the media landscape is mostly filled with information about the COVID-19 disease, caused by the coronavirus, and that we are provided on a daily basis with information about measures undertaken by the governments of many countries in order to mitigate the negative effects of the crisis on the economies of each country, and having regard to the fact that this same media landscape is also filled with various inaccurate news relating to indirect taxes, we deem it our responsibility to inform you of the following:

The provision of Article 38(2) of the Law on Added Value Tax (Official Gazette of BIH 9/05, 35/05, 100/08 and 33/17) defines that a taxpayer shall be required to calculate VAT for a corresponding tax period on the basis of the total supply of goods or services shown in invoices in the tax period. Furthermore, Article 39, which defines submission of VAT returns and payment of tax, prescribes that taxpayers shall be obliged to state their VAT liability calculated for a certain tax period in a monthly VAT return and shall submit the return by the 10th day of the month following the expiry of the tax period. Furthermore, Article 79 of the Rulebook on the implementation of the Law on Value Added Tax (Official Gazette of BIH 93/05, 21/06, 60/06, 6/07, 100/07, 35/08, 65/10 and 85/17), which defines VAT payments, stipulates that taxpayers shall pay VAT until 10th of a month for the previous month at the latest, Indirect Taxation Authority said in a press release.

Therefore, in accordance with the above-mentioned considerations, and having in mind that no amendments have been made to the aforementioned regulations, taxpayers shall submit their VAT returns for a tax period by the 10th day of the month following the expiry of the tax period, and shall pay their reported liabilities by the 10th of the month as well. The reason we have pointed this out is that, due to a large amounts of information placed in the media about a possible change to the reporting and/or payment deadlines, some taxpayers may be misled that the above-mentioned deadlines have been changed, which is not the case.

At the same time, you are hereby reminded that failure to pay tax liabilities by the deadline defined in the Law, i.e. by the 10th day of a month for the previous month, shall be subject to enforcement procedure immediately on the next day following the expiry of the voluntary deadline, i.e. on the 11th day of the month, as stipulated in Article 11 of the Law on Indirect Taxation Procedure (Official Gazette of BIH 89/05 and 100/13), which entails an additional burden in the amount of 5% of the amount owed. In addition, the provision of Article 10 of the same Law, which defines default interests, stipulates that a default interest at a daily rate of 0.04% shall be paid for each day of default for indirect tax amounts that have not been paid within the statutory deadline and in the prescribed manner.

Finally, it is our responsibility to also remind you that any failure to meet the aforementioned regulatory provisions would entail the launch of relevant infringement proceedings. In particular, any taxpayer who, by action or non-action, commits an infringement shall be subject to a fine for the infringement commited as stipulated by the provisions of Article 67 of the Law on Value Added Tax. Paragraph 1 point 4. of this Article defines that a taxpayer shall be fined in the amount of BAM 300 in the case he fails to submit a VAT return or fails to submit it within the prescribed time limits in accordance with paragraphs 1 through 4 of Article 39 of this Law, except in the cases where the return is negative. The provision of paragraph 2 of the same Article of this Law stipulates that an authorised person working for a legal person shall be subject to the same fine as provided for the legal person, is stated by Indirect Taxation Authority.

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