I
BASIC INFORMATION FROM THE LAW ON CRAFTS AND RELATED ACTIVITIES
DEFINITION OF THE CRAFT
According to the Law on Crafts and Related Activities (“Official Gazette of the Federation of BiH”, no. 35/09 and 14/11) which regulates the registration, performance and termination of performing crafts, a craft represents independent and permanent carrying out of authorized and registered economic activities in the basic, supplementary or additional occupation, by natural persons for the purpose of achieving profit, which is realized by production, trade or the provision of services on the market. According to this Law, related activities are all registered economic and other activities performed by natural persons under the rules of performing crafts, which are not considered crafts.
BASIC, SUPPLEMENTARY AND ADDITIONAL OCCUPATION
If you are not employed, then performing craft activities for you is a basic occupation. Craft as a supplementary occupation means performing activities related to the craft personally, regardless of whether you have permanent employment or whether you have fulfilled the conditions for retirement. According to the Law, performing activities in the supplementary craft is limited to 20 hours per week if you are permanently employed, while the same does not apply to pension beneficiaries who have achieved this right by 40 years of service or 65 years of age. A craft as an additional occupation means that exclusively worker(s) will perform activities. They must be employed by the craft and fulfill the prescribed conditions.
JOINT CRAFT
Two or more natural persons may jointly perform a craft, and the mutual responsibilities shall be regulated by a written contract, which the contracting parties shall submit to the competent authority upon registration in the Craft Register.
HOMECRAFT
Certain crafts and related activities are considered domestic work. This refers to the activities of making and finishing the objects for which the manual work and services in the household are crucial. Homecraft can be performed independently or with the help of members of the common household. The
list of activities which can be performed as a domestic work and the conditions for their performance are prescribed by the Federal Minister of Development, Entrepreneurship and Crafts. Homecraft is entered into the Craft Register.
SEASONAL ACTIVITIES
Crafts and related activities can be performed seasonally, up to a maximum of nine months in one calendar year. Seasonal performance of crafts and related activities is recorded in the Craft Register. The list of activities which can be performed as a domestic work and the conditions for their performance are prescribed by the Federal Minister of Development, Entrepreneurship and Crafts.
RELATED AND SPECIAL CRAFTS
Related crafts require appropriate professional qualifications. For the performance of special crafts, in addition to meeting the qualification conditions, it is necessary to obtain the consent for performing special crafts.
TRADITIONAL AND OLD CRAFTS
Traditional and old crafts require special knowledge of craft skills and skills in performing activities, in which the focus is on manual work. In order to preserve tradition, the Government of the Federation of BiH, governments of cantons and the local self-government units will prescribe the appropriate help, which will stimulate the preservation of traditional and old crafts and increase interest in performing them.
TERMS YOU NEED TO FULFILL
According to the Law, you can perform a craft as a basic occupation if: you are a citizen of Bosnia and Herzegovina; you are capable of working; if you meet general and special health conditions if it is required by a certain law and if a there is no valid court verdict, or a decision on a misdemeanor, or an administrative act which bans you to perform craft related activities. If you are an employee or retired, you also need to fulfill the above-mentioned conditions to perform the craft as a supplementary or additional occupation. Foreign citizens can also start a craft in FBiH, if they meet the requirements prescribed by the Law.
PREMISES AND EQUIMPENT
Premises and equipment for performing crafts must also comply with the regulations on: technical equipment, protection at work, protection and improvement of the environment, protection against noise, health and sanitary conditions, and other regulations related to the performance of certain economic activity.
Business premises need to meet the following conditions:
Adapted and equipped access area;
Minimum height of 2.4 m and for spaces of less than 10 m² height of at least 2.1 m² is required, as well as entrance doors wide at least 90 cm;
Minimum width of staircases of 1 m in case of a condominium premises;
Business premises must have for each employee at least 3m² of area with at least 10m³ of volume;
Personal hygiene space;
Fire extinguishers;
Good artificial or natural ventilation;
Illumination of at least 20 lux per m².
More details about other conditions that your space needs to meet can be found at the web site of Crafts Chamber of Sarajevo Canton on this link: http://www.obkom-fbih.ba/zakonske-i-podzakonske-norme/21-pravilnik-o-minimalnim-tehnickim-uvjetima .
CRAFT LICENCE
For performing related and special crafts, a craftsman must own a Craft License (called “obrtnica”), which is actually a work permit. It is issued by the competent authority in the territory where the headquarters of the craft are located. It is issued in two sizes, large and small, and a craftsman is obliged to exhibit large one at the headquarters of craft, in a visible place. ESTABLISHING A CRAFT IN SARAJEVO CANTON
To initiate the process of establishing crafts, it is necessary to collect the documentation and submit it together with the Craft Establishment Application in the municipality, where a craft will be headquartered. You should submit necessary documents to the craftsmanship sector in the municipality. However, in most of the municipalities the competent department for craftsmanship is actually an economic department. Establishment can take up to 30 days in total. Later on, there will be a more detailed explanation of the sequence of steps you need to follow to establish your craft as soon as possible.
APPLYING FOR THE REGISTRATION OF THE CRAFT IN THE MUNICIPALITY
The documentation you enclose with the application may be different due to the type of craft you would like to register. It can also depend on the municipality where you register it, as well as to depend on your status (employed, unemployed or retired). In Sarajevo Canton, you can find the application form for the registration of craft on the websites of all nine municipalities, as well as physical copies on their counters. In addition, the requirements in most municipalities are classified according to the type of crafts and they specify what you need to enclose with the documents, depending on the type you intend to register. Below, you will find a list of the documents you need in most cases for registration of crafts in the municipality, as well as the list of institutions in which you are obtaining them. Depending on the specifics of your case, you will also need to collect additional documentation, which is mainly mentioned in the application you obtain from the municipality. It would be the best if you would download an online application form that matches your case before collecting the documentation and then to start collecting the necessary documentation in accordance with it. For the registration in the municipality, you will need
approximately ten days, depending on the scope of the work and the resources that the competent service has.
BASIC DOCUMENTS
Photocopy of Certificate of Citizenship – including original for the insight;
Photocopy of ID card – including original for the insight;
Certificate of Business Capability;
Certificate That a Competent Body Has Not Issued a Measure Prohibiting the Carrying Out of the Activities;
Medical Certificate;
Certificate of Unemployment, if you are unemployed;
Proof that you are employed – if you are employed;
Certificate of Pensioner Status from Pension and Disability Insurance Institute (PIO) if you are retired;
2 It is based primarily on the Application for Establishment of Crafts and Related Activities in the municipality Centar (Form 04-12.1)
Partnership Agreement – If you do not start a craft by yourself;
A document proving basis for the ownership of business premises if you are going to do business outside your home (a lease agreement, an excerpt from the Land Registry or a purchase contract);
Evidence of possessing the appropriate professional qualifications (diplomas of educational institutions that you have attended or corresponding certificates);
Certified statement that the business space meets the minimum conditions for carrying out the desired activities, which you submit in the municipality where you register the craft;
Professional Opinion on Noise Protection for certain types of business premises in residential and commercial buildings of collective housing, obtained from a legal entity registered for issuing expert opinion;
Certificate of no Criminal Conviction;
Proof of the fee payment – original payment slip.
ACQUIRING DOCUMENTS FOR THE REGISTRATION AT THE MUNICIPALITY
Below you can find a list of institutions that need to visit to collect documents, depending on your status and the type of craft that you would like to establish.
At the Municipal Court in Sarajevo, you will obtain a Certificate of not Being Banned to Perform the Activities. Taking into account that you are supposed to pay court fee in the amount of BAM 15, the best option is to purchase the court fee, at the official sales place in the building of KJKP ZOI ’84 d.o.o. (across the street from National Theatre). Then, in the Court’s building, find the Office no. 11, and in front of that office you can take the application form you need to fill and submit with the previously purchased fee ticket. You will get the certificate on the day of application.
At the Pension and Disability Insurance Institute (PIO), you obtain the Certificate of Pensioner Status, if you are retired.
If you have established a craft with partner or partners, you must sign a Partnership Agreement with them prior to visiting the municipality. This can be done in notary’s office.
In the bank or post office, you should pay administrative and other fees. The type of income you enter is 722121. The purpose of the remittance is “privredna taksa” and the recipient is “Budžet Kantona Sarajevo”. Craft registration fee costs BAM 80 and you will also pay an administrative fee of BAM 8. At the Ministry of Interior of Canton Sarajevo, you obtain a Certificate of no Criminal Conviction for which you should pay BAM 5 and administrative fee of BAM 2.
You obtain Medical Certificate at the health center, for which you need to pay BAM 50.
You obtain a Certificate of Citizenship in the municipality of your residence.
If you need proof of unemployment, then obtain the Unemployment Certificate from the Employment Service of Canton Sarajevo, located at Dolac Malta, at Ložionička no. 5. You will need to pay BAM 10 for the issuance. The application form can be found at this link:
http://eregistar.ks.gov.ba/ap/jusz-obz-01-uverenje-o-nezaposlenosti/ .
The Certificate of Business Capability is issued by the Center for Social Work in the municipality of your place of residence and is obtained ex officio. For this, you should pay an administrative fee in the amount of BAM 6, and you can buy the fee ticket in the municipality.
In the municipality where you set up a craft, you submit the Statement that the Business Space Meets the Requirements for Doing Business.
You submit the completed registration documentation to the municipality where your craft will be registered.
You have completed the process of registration in the municipality when its competent department grants you approval in the form of Craft License. Make a few copies of it, so that you can enclose if necessary. Upon registration, you are required to start performing the activity within 30 days of the finalization of the decision to approve the establishment. From that day on, you have rights and obligations in accordance with the applicable regulations. After registering the craft in the municipality, it is necessary to take a few more steps to get started.
MAKING THE STAMP
You need bring your Craft License, as well as a personal document stating your identity, such as an ID card. Making a stamp usually takes one day, and the price depends on your choice of stamp and it ranges from BAM 30 to 50. You can make a stamp in a print shop or specialized stamp making shops.
OBTAINING A NOTIFICATION ON CLASSIFICATION OF ACTIVITIES
You should pay a visit to the Federal Bureau of Statistics for classification of your craft based on activities with the following documents:
Identically filled two copies of the form – Registration/Deregistration of Natural Persons – Craftsmen and Persons Performing Related and Other Activities (Form PFL-3), which can be downloaded from the Institute’s website on this link: http://fzs.ba/wp-content/uploads/2016/06/PFL-3_bos.pdf
Photocopy of the permit or decision of the competent registration body – Craft License;
Stamp;
The Unique Citizen Number (JMBG) of the owner of the craft and / or the responsible person in the separated part.
The data you copy from a Craft License when filling the application must fully match the data in the original document. In the space marked “POPUNJAVA STATISTIKA” (means filled by the Bureau) you are not supposed to write anything. This will be done by the competent authority. This procedure does not require financial expenses, except for the possible costs of copying and certifying documents.
The competent department of the Bureau of Statistics will issue a document called the Notice on the Classification of Activities in two copies. You should keep one copy, and the other hand over the other one to the Tax Administration in the next step. The Office of the Federal Bureau of Statistics for the Canton of Sarajevo is located at Maršala Tita no. 62nd.
ACQUIRING THE CERTIFICATE OF TAX REGISTRATION
After obtaining the classification notice, registration with the FBiH Tax Administration Registry for obtaining the ID number (JIB) and the Certificate of Tax Registration is in the next you are supposed to do. This procedure does not require financial expenses, except for the possible costs of copying and certifying documents. If the other person is doing the registration for you, then a validated power of attorney is required. The following documents are required:
Identification document, such and an ID card;
Copy of a Craft License;
One original copy of classification notice that you obtained in the previous step;
A completed form for obtaining an ID number (JIB) and a tax registration of a craftsman (RPO-PFL-3), which you can download from the Tax Administration’s website at the link: http://www.pufbih.ba/v1/public/upload/obrasci/09667-pfl3_rpo_bs_int2.pdf
If the documentation is complete and no irregularities have been found, you can expect Tax Registration Certificate within five days. Your JIB will be listed in the Certificate.
BANK ACCOUNT
The next step in the process of starting a business is opening a transaction account at a chosen bank. You can take an application form at the bank or you can download one from the Internet. You should enclose the following additional documents with the application form when you submit it:
Craft License – original or a copy certified by the competent body;
Notice on the Classification of Activities (original or copy certified by the competent body);
Tax Registration Certificate (original or copy certified by the competent body);
Certificate of VAT Registration (original or a copy certified by the competent authority) or a statement that you are not an indirect taxes payer (in case you do not intend to register in the VAT system);
Specimen signature card of persons authorized to sign orders and copies of their ID cards, certified by the competent authority. You can download the signature card in the online form or take a copy from a bank’s office;
A copy of the ID card of the legal representative(s) of craft certified by the competent authority;
A copy of the Certificate of Residence Registration or a utility bill copy (not older than 3 months), from which the address of authorized person who submitted the required documentation can be determined;
59
A copy of the ID card of the other person who submitted the necessary documentation, verified by the competent authority;
A copy of the Certificate of Residence Registration or a utility bill copy (not older than 3 months), from which the address of residence of persons authorized to manage the funds on the account can be determined;
Statement of an authorized person of not owning a bank account on which ban on managing the funds was imposed.
REGISTRATION OF OWNER AND EMPLOYEES IN THE UNIFIED SYSTEM
The office of Tax Administration where this procedure will be performed is determined by the municipality of registration of your craft. You are obliged to register yourself as the owner and potential employees in the Unified Registration, Collection and Control System of the Tax Administration of the Federation of Bosnia and Herzegovina. You are submitting the application on the basis of the Employment Agreement and you need to complete the Form JS3100 Registration/ Change / Deregistration, which you can take from the Tax Administration’s offices or download through their website via this link:
http://www.pufbih.ba/v1/public/upload/obrasci/20caf-e1940-js3100_bs_interactive-v2.pdf.
For this procedure, you will need one day and you will not have any financial expenses. The Tax Administration is connected to the Health Insurance Institute, so you do not have to go there to enroll yourself and them in health insurance system.
TAX CARD
In order to be eligible for personal deductions (you and your employees), each of you must complete and submit a Tax Card Application Form (Form PK-1001) to the competent branch office of the TA of FBiH, according to your place of residence. Explanation of tax deductions can be found on the Federal Ministry of Finance website at the link:
http://www.fmf.gov.ba/info/2008/11122008.htm .
60
You, as the owner of a craft or self-employed are entitled to deducted personal income tax based on personal deductions after the current year expires. Your workers are entitled to exercise this right immediately if they have a tax card. REGISTERING AT THE VAT SYSTEM
Craftsmen do not invoice their customers for VAT, which allows them to form the prices of their products and services that are more competitive on the market. For this reason, you will not be required to register in the VAT system, until you have reached an annual turnover of up to BAM 50.000 or until you estimate that it is favorable to do so. Some craftsmen are voluntarily registered in the VAT system, because they estimate that it is more cost-effective for tax refunds. Taxes are then transferred to the end-customer by registering in this system. If you anticipate that you will exceed the threshold for registration or you voluntarily still want to enter the VAT system, follow the next steps.
The Application Form for Registration and Enrollment in the Unified Registry of Indirect Taxpayers (ZR1) should be submitted to the Regional Center Sarajevo of the Indirect Taxation Authority (ITA), at the address Zmaja od Bosne 47b. The Decision and Certificate of Registration and Enrolment into the Unified Registry is provided by the Support Sector of the ITA at the Central Office, located in Banja Luka.
The application can be downloaded online via this link: http://www.new.uino.gov.ba/bs/Dokumentacija%20koja%20se%20podnosi%20za%20registraciju%20za%20PDV.
A craftsman is obliged to enclose the following documentation (copies with original or certified copies for insight) when registering in the VAT system:
Approval of competent authority for performing activities – Craft License;
Identity card of the applicant;
Certificate of Registration from the Tax Administration;
A signature specimen card certified by a commercial bank in which the transaction account is registered (for all transaction accounts) or other proof of a registered transaction account for a natural person performing a taxable activity;
Notice on the main account, chosen at an authorized payment system organization, in accordance with entity’s regulations on internal payment systems;
A document of the competent authority in accordance with the laws regulating the field of work and stay of foreigners in BiH and a passport or another identification document for a natural person-entrepreneur, a foreign citizen;
A power of attorney authorizing a BiH citizen to represent a taxpayer in ITA proceedings, in the absence of a natural person-entrepreneur, a foreign national;
A payment slip proving that you have paid administrative fees.
Administrative fees you are supposed to pay when registering your craft in the VAT system:
The fee for an Application for Enrollment in the Unified Register of Indirect Tax Payers (BAM 10);
The fee for the issuance of Decision on Registration and Enrollment in the Unified Register of Indirect Tax Payers (BAM 10);
The fee for the issuance of a Certificate of Registration and Enrollment in the Unified Register of Indirect Tax Payers (BAM 20)
Total financial expenses for these fees are BAM 40.
FISCAL DEVICE
It usually takes 10 days to obtain a fiscal device. You need approx. BAM 700 to purchase a device from an authorized distributor, and the Tax Administration of FBiH is competent institution for reporting your device. You are supposed to have a contract with an authorized servicer. You need to complete and certify the initialization document (called ZIF document) and submit it to the authorized service with whom you signed the contract, which will forward the initialization document to the Tax Administration of FBiH on your behalf. Every indirect tax payer is obliged to sign a contract with the telecommunications operator through an authorized service. After initialization, the taxpayer is required to take over the fiscal device through which they will begin to record sales data by the latest two days from receiving the device, in accordance with the law.
The application form to initialize the process can be downloaded from the website of Tax Administration of FBiH via this link:
http://www.pufbih.ba/v1/public/upload/obrasci/b6e65-zif_interactive2.pdf
NECCESARY DOCUMENTS
Proof of registration;
Certificate of Tax Registration (Tax ID number – JIB);
Certificate of VAT Registration;
Correctly fulfilled initialization application form;
Copy of an ID card od a responsible person;
Stamp.
VAT REGISTRATION EXPLAINED STEP BY STEP
Choose the appropriate fiscal device from a certified distributor;
Sign a Purchase Agreement;
Signs an Agreement on Service and Technical Support;
Submit the application form and perform the initialization of the device;
Sign an agreement with a telecommunication services company for the transmission of GPRS data to the Tax Administration;
Enter items in the fiscal device;
Begin to use the device.