The Government of the Federation of Bosnia and Herzegovina has adopted amendments to the Decree on Financial Aid to Employees, effective August 1, 2025. This measure allows employers to continue providing monthly non-taxable aid of up to BAM 400 to their employees — without incurring additional tax or contribution costs.
🔹 Key provisions of the Decree:
- Until July 31, 2025, employers may pay up to BAM 450 per month
- From August 1 to December 31, 2025, the maximum amount is BAM 400 per month
- Aid for December 2025 may be paid no later than January 31, 2026
- The aid is exempt from income tax and social contributions
Full details available on the official website of the Government of FBiH
Impact on Payroll Calculations
This Decree coincides with the implementation of the new unified contribution rate of 36%, replacing the previous 41.5%, offering employers a dual fiscal relief.
🔹 1. Non-taxable aid:
- Up to BAM 400 per employee per month can be paid without tax or contribution obligations
- The aid is not included in gross salary and does not increase the contribution base
🔹 2. Reduced contribution costs:
- The new 36% rate applies from July 2025
- Employers pay lower contributions for pension, health, and unemployment insurance
🔹 3. Net effect for employees:
- Employees receive the full amount of aid in addition to their regular salary
- Employers can increase net earnings without increasing total payroll costs
Conclusion:
This measure enables more flexible payroll planning, supports employee retention, and serves as a motivational tool — without additional fiscal burden.
