Transfer tax when selling property in FBiH: who pays

In the Federation of Bosnia and Herzegovina (FBiH), property transfer tax (porez na promet nekretnina) is set by each canton, so who pays it depends on where the property is. Under the cantonal laws we checked, the buyer pays in Sarajevo Canton, Herzegovina-Neretva Canton and Herzegbosnia Canton (Canton 10), while the seller pays in Tuzla Canton. The tax is calculated on market value set by an official valuation commission, not on the contract price, and where we could verify the rate it is 5% or capped at 5%.

This page focuses on transfer tax in the FBiH because that is where we have checked sources. For Republika Srpska (RS), Brčko District, tax on any gain from the sale, notary fees and agency commission, we say plainly at the end what we could not confirm and which questions to put to the right office. This is general information, not legal advice: a notary, lawyer or the tax office confirms the details for your specific case.

Who pays transfer tax, canton by canton

A quick orientation: Bosnia and Herzegovina has two entities, the Federation (FBiH) and Republika Srpska (RS), plus Brčko District. The Federation is divided into ten cantons, and this tax is a cantonal matter there.

Sarajevo Canton (KS)

• Who pays: the buyer, meaning the person ownership passes to (Law on Property Transfer Tax and Inheritance and Gift Tax, Službene novine KS 28/18, Article 7). Službene novine is the cantonal official gazette where laws are published.
• Exchange of properties: whoever receives the more valuable property pays.
• Rate: 5% (Article 11). For lifetime-care contracts (ugovor o doživotnom izdržavanju, where property passes in return for caring for the owner), care lasting under 3 years is taxed at 10%.
• Tax base: market value. The cantonal government sets the criteria and a municipal commission carries out the valuation. The taxpayer must let the commission into the property.
• Deadline: the tax is paid within 30 days of receiving the tax assessment (rješenje). Late payment adds default interest.

For a seller in Sarajevo, transfer tax is not your cost. But the buyer will factor it in when deciding how much they can offer.

Herzegovina-Neretva Canton (HNK)

• Who pays: the buyer (sticatelj nekretnine), Article 7.
• Exchange: each party pays on the value it receives.
• Shares of a property: if several people each acquire a share, each pays tax on their own share.
• Rate: the total may not exceed 5%, and municipal and city councils also have a role in setting it, so check the rate in the municipality (opština) where the property is.
• Tax base: market value at the moment the tax becomes due (Article 9). A fee for the valuation commission's work is also payable.
• Proof of payment: the law requires written proof that the tax was paid. Ask the notary at which stage it is needed.

Herzegbosnia Canton (HBŽ, Canton 10)

• Who pays: the buyer (stjecatelj), under the Law on Transfer Tax on Property and Rights, Narodne novine HBŽ 9/21, Article 7(1).
• Tax base: market value recorded in the valuation commission's minutes.
• Rate: we could not verify it. Confirm it with the local tax office.

Tuzla Canton (TK)

• Who pays: the seller, under the Law on Transfer Tax on Real Estate and Rights (Službene novine TK 11/01, as amended), Article 7.
• Exchange: the party giving property pays.
• Exemptions: the law provides exemptions, among them one for young people up to an age limit, and special treatment for newly built flats sold for the first time. We could not verify the exact conditions or the rate, so confirm them with the tax office before you agree a price.

In Tuzla Canton, then, transfer tax is a seller's cost and belongs in your asking price calculation.

Una-Sana Canton (USK)

• Rate: set by each municipal or city council by decision, capped at 5%. Councils may set lower rates or exemptions, for example to support business development and new jobs, or for veterans and social categories.
• Procedure: the tax office must act within 30 days of receiving the valuation minutes. The taxpayer must give the valuers access and be invited at least 3 days before the valuation.
• Who pays: we could not confirm this from the text of the law. Ask the local tax office.

Zenica-Doboj and Bosnian-Podrinje (Goražde) cantons

For these two cantons our information comes only from a secondary source (an agency blog), not from the laws themselves:

• Zenica-Doboj (ZDK): according to that source the seller pays unless the contract says otherwise, and in liquidation, bankruptcy or enforcement sales the buyer pays.
• Bosnian-Podrinje (BPK Goražde): according to that source the seller pays, at 5%.

Confirm both with the tax office before agreeing a price.

Central Bosnia, Posavina and West Herzegovina cantons

We have no verified information on who pays or the rate. Ask the relevant branch of the FBiH Tax Administration (Porezna uprava FBiH) or a notary.

A common mistake about who pays

You will often read that in the Federation the seller pays everywhere except Sarajevo. According to the laws we checked, that is wrong: the buyer also pays in Herzegovina-Neretva and Herzegbosnia cantons.

How the transfer tax procedure usually works

The exact order depends on the canton, but the laws we reviewed show a typical sequence:

1. After the sale contract is signed, the taxpayer reports the transaction to the competent tax office.
2. A valuation commission sets the market value. The taxpayer must allow access to the property and in some cantons also pays a fee for the commission's work.
3. The tax office issues an assessment (rješenje) stating the amount due.
4. The tax is paid within the deadline in the assessment (in Sarajevo Canton, 30 days from receipt).
5. Keep the proof of payment and hand it in where it is required.

If you live abroad and are not in Bosnia for the valuation, plan in advance who will open the property for the commission. How long the valuation takes, and exactly when proof of payment is needed, are questions for the notary and the tax office in your municipality.

Example: selling a flat in Sarajevo

DMI currently has 8 properties listed, all in Sarajevo. The median asking price is 5,722 KM per m² (range 3,667 to 6,574 KM per m², based on the 7 listings with a published price). KM is the convertible mark, the local currency. Take our two-room flat of 54 m² in Čengić Vila, asking 309,000 KM.

• The flat is in Sarajevo Canton, so the buyer pays transfer tax.
• If the commission set market value at 309,000 KM, the tax at 5% would be 15,450 KM.
• The commission may set a value different from the agreed price, so the exact amount is only known from the assessment.
• The same flat in a canton where the seller pays would be a 15,450 KM item in the seller's own figures.

So before you advertise, check the rule in your canton and set the price knowing who carries the tax. Our guide on how to price a property for sale in Bosnia covers the rest of that calculation.

Mistakes to avoid

• Assuming the seller pays everywhere except Sarajevo. The buyer also pays in HNK and HBŽ under the laws we checked.
• Calculating tax on the contract price. The base is the market value set by the commission.
• Leaving costs out of the pre-contract. Where the law allows the parties to agree otherwise, write clearly in the pre-contract (predugovor) who bears which cost.
• Not giving the commission access. The laws we reviewed require it, and delays hold up the assessment.

What we could not confirm, and what to ask

Republika Srpska

The sources we reviewed disagree on whether RS has a property transfer tax at all and who would pay it, so we do not state it as fact. Ask the RS Tax Administration (Poreska uprava RS) or a notary.

What is confirmed is an annual property tax in RS of up to 0.20% of value, or up to 0.10% for property used for production (Službeni glasnik RS 91/15, applied from 1 January 2016).

According to a media report, an owner who transfers property during the year should settle any property tax debts on it by the day of transfer, and notaries check this directly with the RS Tax Administration, without the parties bringing a certificate. We have not confirmed this in the regulations, so ask the notary whether it applies and what happens if a debt is outstanding.

Brčko District

We found no verified information on transfer tax in Brčko District. Ask the Brčko District Finance Directorate (Direkcija za finansije) or a notary.

Tax on the gain from a sale

We could not confirm whether, or under what conditions, tax is payable on a gain from selling property. Before selling, ask the competent tax administration:

• Is tax on profit or income payable on the sale of my property?
• If so, how is the base calculated and at what rate?
• Are there exemptions, and under what conditions?
• What do I have to report, and by when?

If you are tax resident in the UK, Scandinavia, the Netherlands or the USA, also ask a tax adviser there whether the sale must be declared in your country of residence.

Notary fees

We have no verified information on how notary fees are calculated, whether VAT is added, or who usually pays. Confirm the fee with the notary before booking, and write in the pre-contract who bears it.

Agency commission

We have no verified information on any legal cap on commission or on who usually pays. Before engaging an agency, ask for the amount, who pays it and when it falls due to be written into the contract.

Land registry fee

We have not covered the fee for recording the sale in the land registry (zemljišna knjiga, often called gruntovnica). Ask the notary or the competent court what to budget and who pays it.

For the papers a seller prepares, see documents you need to sell property in Bosnia.

How DMI helps

We visit every property in person before listing it and check its land registry status, legalisation and photos, so both buyer and seller know from the start what they are dealing with. Before you set a price, we help you check who pays transfer tax in your canton and which questions to put to the notary and the tax office. For buyers abroad we offer video tours. If you are thinking of selling, get in touch through Sell your property.