Sijerčić & Partners
Can anyone (including foreigners) own and occupy real estate in your jurisdiction (including shares in property owning companies)? Are there any restrictions?
Foreigners may acquire and own properties subject to reciprocity between BIH and the country of their origin, with exception of the arable land and the real estate located in protected areas of nature, as defined by special laws. Exceptionally, the foreign natural persons in FBiH and BD can acquire the ownership over arable land through inheritance. In RS such limitation does not exist for foreign natural or legal entities, and they are allowed to own the arable land without restriction provided that the reciprocity principle is respected. In four cantons in FBiH the foreign natural or legal persons are not allowed to acquire ownership over the forest and forest land whereby other six cantons and RS and BD do not provide such limitation.
Foreigners can own shares in property owning companies without restrictions.
Are there restrictions on lending for the purchase of real estate by foreign companies? If so briefly give an outline?
There are no restrictions on lending for the purchase of real estate by foreign companies, but loan transactions with foreign entities are subject to registration to the competent ministries of finance in BiH.
Buying
Please provide a short summary of the fees and costs (including tax) relating to buying real estate in your jurisdiction.
Transfer of real estate is subject to the real estate transfer tax at the flat rate of 5% for FBiH.
The notarial fees for the real estate purchase agreement, depend on the purchase price, but may not exceed the amount of BAM 2,000 (approx. EUR 1,000) net of VAT. Due to the recent court practice in FBH, notarization of real estate purchase agreement is not required (i.e., certification of the signatures in the court is deemed sufficient).
The fee for registration of ownership amounts of approx. BAM 80 (approx. EUR 40), while in RS it amounts to BAM 50 (approx. EUR 25) plus 0.2 % of the real estate value (companies are exempt from paying 0.2 % of the real estate value)
Owning
Are there taxes applicable to owning real estate and can the burden of the taxes be passed to someone else (e.g. a tenant or an occupier - not being the owner
In FBIH, owners are required to pay the property tax as a lump sum in the amount depending on the surface of the premises, but only in case they are using for leisure or if they are renting it out. There is no possibility to pass the tax burden to other parties.
In RS and BD, the real estate tax is paid annually at the rate of 0,10% - 0,20% (RS) and 0,05% - 1,0% (BD). Same as in FBIH, in RS and BD the taxpayer of the real estate tax is the owner of the real estate, and the burden of the taxes cannot be passed to someone else. Theoretically, if the owner of the real estate cannot be determined or found, the taxpayer is a person who, on any ground, uses or occupies the real estate. The tax base is the estimated value of the real estate, determined by the competent tax authority.
Tax Breaks
Are there tax breaks or other incentives for foreigners to buy real estate in your jurisdiction? If so, what are they?
There are no tax breaks or other incentives for foreigners to buy real estate in BiH.
How is the ownership of Real Estate evidenced in your jurisdiction?
Ownership over real estate is acquired upon registration of the ownership in the relevant land registry i.e. public records on the real property.
Is it possible to keep the identity of owners of real estate confidential in your jurisdiction?
No, it is not possible to keep the identity of owners of real estate confidential, since relevant registries of the real estate are public registries to which any interested party have free access and request the official excerpts from these registries