Salary Calculation Example (Concrete numbers)
Theory is clear, but what does the calculation look like in an average case of an employee for 2026? For this hypothetical example, we will use fictitious Damir from Sarajevo who has an average salary and one child, to illustrate all the steps listed in How salary is calculated.
Input parameters:
- Negotiated Gross 1: 2.000,00 KM
- Place of residence: Sarajevo (FBiH)
- Number of children: 1
- Basic personal deduction: 300,00 KM
1.Gross 1 (Starting point)
2.000,00 KM
2.Contributions from salary (31% in FBiH)
2.000,00 KM × 0.31
- 620,00 KM
3.Income
(2.000,00 - 620,00)
1.380,00 KM
4.Total personal deduction
Basic (300.00 KM) + For children (150.00 KM)
- 450,00 KM
5.Tax base
This is the only amount that is taxed.
(1.380,00 - 450,00)
(1.380,00 - 450,00)
930,00 KM
6.Income Tax (10%)
930,00 KM × 0.10
- 93,00 KM
To be paid (Net Salary)
(1.380,00 - 93,00)
1.287,00 KM
What about Gross 2?
In order for Damir to receive 1.287,00 KM on his account, the company must also calculate and pay contributions ON salary (10.5%) on the amount of Gross 1 (2,000.00 KM). This is an additional cost. You didn't even see it, but the employer paid it to the state on your behalf.
Total cost (Gross 2):
2.210,00 KM(2.000,00 + 210,00)
Amounts may differ slightly (±0.05 KM) depending on the rounding methodology within specific accounting software, but the procedure shown above represents the only correct mathematical way of calculation.