Cash Withdrawal from Bank Account

Cash payment is an exception and is subject to strict regulations:

Payment Limit up to KM 200: Business entities may pay in cash for goods and services to another legal entity or sole proprietor up to a maximum amount of KM 200 per single invoice within a single day.

Prohibition of Invoice Splitting: It is strictly forbidden to divide a single purchase into multiple smaller cash invoices to artificially circumvent the KM 200 limit. Inspectors treat such actions as a violation subject to fines.

Purchases from Individuals: Payments to natural persons who do not perform an independent business activity (e.g., purchase of agricultural products or secondary raw materials) are allowed in cash using a prescribed purchase receipt block (otkupni blok).

What IS PERMITTED to be paid in cash from the petty cash register?

According to the Decree and tax regulations, cash withdrawn from a company account may only be used for explicitly allowed purposes:

• Material and Small Operational Expenses (up to KM 200):

  Purchase of small office supplies, hygiene products, fuel, or urgent repairs.

  Every expense must be supported by an original fiscal receipt and an invoice issued in the name of the legal entity.

• Non-Taxable Employee Allowances:

  Payment of meal allowance (topli obrok) and transportation allowance to and from work (within non-taxable limits).

  Payment of annual leave allowance (regres) in accordance with statutory limits.

  Payment of one-time financial assistance to employees (severe illness, death of an immediate family member) up to prescribed non-taxable amounts.

• Travel Advances and Daily Per Diems:

  Withdrawal and payment of cash based on a previously issued official travel order for business travel domestically or abroad.

  Reconciliation is carried out with attached receipts for accommodation, transport, tolls, and calculated applicable per diems filed through the travel expense report.

• Fees under Work Contracts and Author Royalties to Natural Persons:

  Permitted in cash only after the applicable taxes and contributions have been calculated and paid to the designated public revenue accounts.

What CANNOT be paid or disbursed in cash (Strict Prohibitions)?

The Law on Internal Payment Transactions and tax regulations explicitly prohibit cash payments for the following purposes:

• Payment of Net Salaries to Employees:

  Net salary CANNOT be paid in cash. Salary payments to employees must be executed exclusively via non-cash transfer—by moving funds from the company’s transaction bank account to the employee’s personal bank account.

• Payment of Dividends / Profit to Capital Owners:

  Payment of realized profit to founders in cash is strictly forbidden. Profit is paid exclusively via bank transfer to the founder's personal current account after the profit tax (10%) has been paid.

• Payment of Invoices Exceeding KM 200 between Business Entities:

  Any invoice between business entities that exceeds KM 200 must be paid via bank transfer (non-cash payment through a bank).

• Loans and Cash Withdrawals without Contracts:

  Cash withdrawals for the personal needs of the owner or director without a proper contract are treated by the Tax Administration as concealed income, incurring full contributions, income tax (10%), and default interest.

Mandatory Petty Cash Documentation and Cash Holdings Maximum

Every inflow and outflow of cash must be recorded through the accounting service and bookkeeping system:

• Decision on Cash Holdings Maximum (Blagajnički maksimum): A mandatory internal act specifying the maximum amount of cash a company is allowed to keep in the petty cash box at the end of the business day. Any excess cash must be deposited into the transaction bank account.

• Petty Cash Journal / Ledger: Cash receipt vouchers (blagajnički nalog za uplatu) and cash disbursement vouchers (nalog za isplatu) must accompany every single transaction, complete with authorized signatures and the original invoice attached.

Fines for Violating the Decree on Cash Payments

Severe penalties are prescribed for non-compliance with the provisions of the Decree on Cash Payments:

• KM 5,000 to KM 10,000 for a legal entity (LLC / d.o.o.),

• KM 1,000 to KM 1,500 for the responsible person (company director).

Agencija Poslovnost d.o.o. Sarajevo: All Under One Roof

Cash flows and petty cash management require continuous monitoring and strict compliance with the law. Agencija Poslovnost d.o.o. Sarajevo, in cooperation with lawyers, auditors, software companies, and authorized fiscalizers, provides complete security for your business:

• Bookkeeping and Accounting Services: Monitoring the KM 200 limit, maintaining petty cash journals, posting travel orders, and overseeing cash flow management.

• Tax Advisory: Proper preparation of non-taxable disbursements (meal allowance, transport, annual leave allowance, per diems), profit calculations, and tax optimization.

• Legal Support: Drafting internal acts, decisions on cash holdings maximums, and employment rulebooks.

Contact us for a free initial consultation or visit us in Sarajevo. Leave the administration to the professionals!

🏢Agencija Poslovnost d.o.o.
📧info@poslovnost.ba
📞033/246-421
📍Kotromanića 48, Sarajevo