Croatian VAT ID Number for Taxable Persons Established in the European Union (01.01.2015) 

1. Taxable persons from European Union Member States, who supply goods and perform services on the territory of the Republic of Croatia, for which the place of taxation is in the Republic of Croatia, or whose supplies of goods exceeds Croatian supply threshold or if they opt not to apply Croatian supply threshold of HRK 270.000 (appx. € 36.000), are obliged to request from the Tax Administration the allocation of VAT ID number. The structure of VAT ID numbers is HR (country code) + Personal Identification number (OIB). Taxable persons from European Union Member States, to whom a Croatian VAT ID number is allocated, are obliged to file a VAT tax return in the Republic of Croatia from the moment of issuance of a VAT ID number.

2. In order to obtain a VAT ID number a taxable person must submit forms: a) Application for registration for value added tax purposes (P-PDV Form) and b) Application for the assignment of personal identification number (OIB). Forms are available on the Tax Administration’s web site www.porezna-uprava.hr in part Porez na dodanu vrijednost & EU.

3. Necessary forms must be submitted to Tax Administration, Regional Office Zagreb, Avenija Dubrovnik, 32, Department for VAT refund to foreign taxable persons.

4. Forms must be accompanied by: a) A document proving person’s registration (Act of the Establishment or excerpt from the court register), b) A certificate proving the foreign person's registration with the tax administration as a taxable person in its country of origin, c) The statement or other document proving intention to perform business activities in the Republic of Croatia d) Verified power of attorney for persons acting as representatives (if the taxable person will perform business activities via representative).

5. Documentation indicated above under point 4 must be in Croatian or, if not, along with the certified translation to Croatian.

6. Forms and documentation required in order to obtain VAT ID number can be submitted by a taxable person or his assignee. If the taxable person is represented by an assignee, than the submission of documentation indicated above under point 4 must be accompanied by verified power of attorney (in Croatian or certified translation to Croatian). Forms and documentation can be submitted by recommended post indicating “For VAT ID number assignment”.

7. Upon verification of submitted documentation and forms Tax administration immediately, and no later than 8 days, shall allocate VAT ID number to a taxable person.

8. A taxable person who holds a VAT ID number and ceases to perform economic activities in the territory of the Republic of Croatia is obliged, within 8 days, to notify the Tax administration, in order to repeal the assigned VAT ID number. Tax administration will cancel VAT ID number ex officio if according to available data from the Tax Administration the taxable person does not perform an economic activity for more than 2 years, and in all other cases where there is a suspicion of abuse of VAT ID number.



Croatian Corporate Income Tax(Profit Tax) (01.01.2014)


TAXPAYER CORPORATE INCOME TAX
​1. A company or another legal or natural person resident in the Republic of Croatia, who is permanently and independently engaged in an economic activity for the purpose of deriving a profit, an income or a revenue or other assessable economic benefits.
2. A resident permanent establishment (an inland business unit) of a non-resident entrepreneur.
​3. A natural person who derives income pursuant to the income tax regulations, if he/she declares that he/she intends to pay profit tax instead of income tax.
​4. An entrepreneur – a natural person who derives income from small business or the activities equalized therewith, if:
- total revenue in the preceding tax period exceeded of HRK 2,000,000,00 or
- total income in the preceding tax period exceeded of HRK 400,000,00 or
- the value of long-term assets exceeds HRK 2.000,000,00 or
- employed more than 15 employees on average during the preceding tax period.
​5. Exceptionally, the state administration bodies, bodies of regional and local self-government, the Croatian National Bank, state institutions, institutions of units of regional and local self-government, state institutes, religious communities, political parties, trade unions, chambers, civic organizations, artists associations, volunteer fire companies, technical culture communities, tourist boards, sports clubs, sports associations and unions, open-end investment funds established and operating in accordance with the law, endowments and foundations, if they carry out an economic activity and the non-taxation of this activity would result in their obtaining of unjustified privileges on the market, are liable to pay corporate income tax for this activity.
6. Every entrepreneur that is not classified among the entrepreneurs listed in Items 1 – 5 and is not liable to pay income tax according to the provisions of the Personal Income Tax Law and the profit of whom is not taxed elsewhere.
Note: Open-end investment funds established and operating in accordance with the law are not liable to pay corporate income tax (profit tax).
CORPORATE INCOME TAX BY WITHHOLDING
​1. An inland paying agent that pays to foreign entities-recipients (non-residents) who are not natural persons,
​2. The permanent establishments of a non-resident entrepreneur, when they pay to the parent company interest, as well as royalties and other intellectual property rights (copyright, patent, licensing, trade mark, design or pattern, production procedure, production formulas, draft, plan, industrial or scientific experience and similar rights). Exceptionally, the withholding tax shall not be paid if considerations are recognized as the revenues of a resident permanent establishment of a non-resident entrepreneur. The withholding tax shall be paid for all services paid to persons having their permanent establishment or headquarters in the countries, except for the European Union Member States, in which a general or average nominal profit taxation rate is lower that 12.5% and the country is published in the list of countries issued by the finance minister.
​TAX BASE CORPORATE INCOME TAX
​Profit determined pursuant to the accounting regulations as the difference between revenues and expenditures before the profit tax assessment, increased and reduced in accordance with the provisions of The Profit Tax Law.
CORPORATE INCOME TAX BY WITHHOLDING
​Gross amount of a consideration paid by a resident payer to a non-resident recipient.
​TAX RATE CORPORATE INCOME TAX ​20%
CORPORATE INCOME TAX BY WITHHOLDING
15%
20% for all services paid to persons having their permanent establishment or headquarters in the countries, except for the European Union Member States, in which a general or average nominal profit taxation rate is lower that 12.5% and the country is published in the list of countries issued by the finance minister.
​TAX REGULATIONS ​Profit Tax Act (Official Gazette of RC 'Narodne novine' No. 177/04, 90/05, 57/06, 80/10, 22/12).
The Regulations concerning profit tax (Official Gazette of RC 'Narodne novine' No. 95/05, 133/07, 156/08, 146/09, 123/10, 61/12, 146/12).

Croatian  Value Added Tax (01.01.2014)


TAXPAYER ​1. Any person who, independently, carries out any economic activity, whatever the purpose or results of that activity.
​2. Any person who, on an occasional basis, supplies a new means of transport.
3. Taxable person which is not established and has no fixed establishment rendering supplies, or permanent address or habitual residence in the Republic of Croatia and who supplies goods and perform services in the Country, for which the place of taxation is in the Republic of Croatia (unless if the Croatian recipient of goods and services pays VAT). Taxable persons established in the European Union may appoint a tax representative in the Republic of Croatia, while taxable persons established outside the European Union shall be obliged to appoint a tax representative as a person who will be liable for payment of the VAT.
4. State government bodies, state administrative bodies, bodies and units of local and regional self-government, chambers and other legal persons with public authority if they carry out economic of other activity and non-taxation of that activities would lead to significant distortions of competition.

OBJECT OF TAXATION/
TAXABLE BASE
R. BR. OBJECT OF TAXATION TAXABLE BASE
1. ​Supply of goods in the Country for consideration carried out by taxable person acting as such consideration for goods supplied
​2. Acquisition of goods within the European Union for consideration in the Country ​includes everything that the acquirer paid or has to pay to the supplier (the taxable amount shall be established on the basis of the same factors as the taxable amount for supplies of goods)
​3. Supply of new means of transport ​consideration for supplied new means of transport
​4.
Supply of services for consideration carried out in the Country by a taxable person acting as such
consideration for services supplied
​5. Supply of goods for consideration shall be regarded the application by a taxable person of goods forming part of his business assets for his private use or that of his staff, or their disposal free of charge or, more generally, their application for purposes other than those of his business, where the input VAT on those goods or the component parts thereof was wholly or partly deducted ​purchase price of the goods or similar goods or, in the absence of a purchase price, the cost price, determined at the time when the supply takes place
​6. Use of goods forming part of the assets of a business for the private use of a taxable person or of his staff or, more generally, for purposes other than those of his business, where the input VAT on such goods was wholly or partly deducted ​full cost of providing the services
​7. Supply of services carried out free of charge by a taxable person for his private use or of his staff or, more generally, for purposes other than those of his business full cost of providing the services
​8. ​Imports of goods ​customs value determined in accordance with customs regulations


​TAX RATE ​5%, 13% or 25% ​
​REGULATIONS ​The Value Added Tax Law (Official Gazette of RC Narodne novine No. 73/13, 148/13; Decision CCRC 99/13, 153/13)
Value Added Tax Ordinance (Official Gazette of RC Narodne novine No. 79/13, 85/13 - correction, 160/13, 35/14)
Council Implementing Regulation (EU) No 282/2011 of 15 March 2011 laying down implementing measures for Directive 2006/112/EC on the common system of value added tax
Framework Agreement between the European Commission and the Government of the Republic of Croatia concerning the participation of the Republic of Croatia in the European Community’s aid programmes (Official Gazette of RC “Narodne novine-Međunarodni ugovori” No. 8/02, 11/02)​
Framework agreement between the government of the Republic of Croatia and the commission of the European Communities on the rules for co-operation concerning EC financial assistance to the Republic of Croatia in the framework of the implementation of the assistance under the instrument for pre-accession assistance (IPA) (Official Gazette of RC “Narodne novine-Međunarodni ugovori” No. 10/07)​
​Judgments of the European Court of Justice (http://curia.europa.eu/jcms/jcms/j_6/)
​Ordinance on the procedure for exemption from value added tax and excise duty for diplomatic and consular missions, institutions and bodies of the European Union and international organizations (Official Gazette of RC Narodne novine No. 79/13)
​Ordinance on exemption from value added tax and excise duty for goods imported in the personal luggage of persons travelling from third countries and for goods imported as a small consignment of non-commercial character (Official Gazette of RC Narodne novine No. 79/13)


Croatian Value Added taxes (01.07.2013)

I.  Taxpayer

​1. Any person who, independently, carries out any economic activity, whatever the purpose or results of that activity.
​2. Any person who, on an occasional basis, supplies a new means of transport.
3. Taxable person which is not established and has no fixed establishment rendering supplies, or permanent address or habitual residence in the Republic of Croatia and who supplies goods and perform services in the Country, for which the place of taxation is in the Republic of Croatia (unless if the Croatian recipient of goods and services pays VAT). Taxable persons established in the European Union may appoint a tax representative in the Republic of Croatia, while taxable persons established outside the European Union shall be obliged to appoint a tax representative as a person who will be liable for payment of the VAT.

4. State government bodies, state administrative bodies, bodies and units of local and regional self-government, chambers and other legal persons with public authority if they carry out economic of other activity and non-taxation of that activities would lead to significant distortions of competition.

 

II. Object of taxation and Taxable base

 
R. BR. OBJECT OF TAXATION TAXABLE BASE
1. ​Supply of goods in the Country for consideration carried out by taxable person acting as such consideration for goods supplied
​2. Acquisition of goods within the European Union for consideration in the Country ​includes everything that the acquirer paid or has to pay to the supplier (the taxable amount shall be established on the basis of the same factors as the taxable amount for supplies of goods)
​3. Supply of new means of transport ​consideration for supplied new means of transport
​4.
Supply of services for consideration carried out in the Country by a taxable person acting as such
consideration for services supplied
​5. Supply of goods for consideration shall be regarded the application by a taxable person of goods forming part of his business assets for his private use or that of his staff, or their disposal free of charge or, more generally, their application for purposes other than those of his business, where the input VAT on those goods or the component parts thereof was wholly or partly deducted ​purchase price of the goods or similar goods or, in the absence of a purchase price, the cost price, determined at the time when the supply takes place
​6. Use of goods forming part of the assets of a business for the private use of a taxable person or of his staff or, more generally, for purposes other than those of his business, where the input VAT on such goods was wholly or partly deducted ​full cost of providing the services
​7. Supply of services carried out free of charge by a taxable person for his private use or of his staff or, more generally, for purposes other than those of his business full cost of providing the services
​8. ​Imports of goods ​customs value determined in accordance with customs regulations

 

-

III. VAT rate​

5%, 10% or 25% ​

IV. Regulations

​The Value Added Tax Law (Official Gazette of RC Narodne novine No. 73/13)
Value Added Tax Ordinance (Official Gazette of RC Narodne novine No. 79/13)
Council Implementing Regulation (EU) No 282/2011 of 15 March 2011 laying down implementing measures for Directive 2006/112/EC on the common system of value added tax
Framework Agreement between the European Commission and the Government of the Republic of Croatia concerning the participation of the Republic of Croatia in the European Community’s aid programmes (Official Gazette of RC “Narodne novine-Međunarodni ugovori” No. 8/02, 11/02)​
Framework agreement between the government of the Republic of Croatia and the commission of the European Communities on the rules for co-operation concerning EC financial assistance to the Republic of Croatia in the framework of the implementation of the assistance under the instrument for pre-accession assistance (IPA) (Official Gazette of RC “Narodne novine-Međunarodni ugovori” No. 10/07)​
​Judgments of the European Court of Justice (http://curia.europa.eu/jcms/jcms/j_6/)
​Ordinance on the procedure for exemption from value added tax and excise duty for diplomatic and consular missions, institutions and bodies of the European Union and international organizations (Official Gazette of RC Narodne novine No. 79/13)
​Ordinance on exemption from value added tax and excise duty for goods imported in the personal luggage of persons travelling from third countries and for goods imported as a small consignment of non-commercial character (Official Gazette of RC Narodne novine No. 79/13)

 

Croatian accounting & tax news

 Fiscalization (01.01.2013)

What is fiscalization?

Cash transactions fiscalization is a set of measures which are used in order to implement an overview of cash transaction revenues. Fiscal software keeps track of each receipt; Tax Administration needs to approve it (JIR) so it could be printed and given to the buyer.

How is data transmitted from the fiscal cash register to the Tax Administration?

Using an electronic – software solution:
By using special software, such as Octopus or other.
By upgrading already existing application solutions along with digital signing and online data transfer.
All communication with tax authorities is protected with public/private key encryption - X.509 v3.
The certificate will be provided by authorities (FINA).

What is the cash register certification price for the purpose of fiscalization?

300.00 HRK for 5 years (60.00 HRK per year).
Every company must buy a digital certificate (in text file form). It is favorable that it doesn't have to be purchased for each separate cash register, but only for a single company or chain store, and it can then be copied onto all cash registers.
The certificate standard is X.509 v3 and it is independent of the running platform, e.g. Windows or Linux. Demo certificates will be provided by FINA free of charge.

What is the fiscalization process for subjects to fiscalization?

Usage of POS devices equipped with internet connectivity and an appropriate software for generating and digitally signing xml transactions.
Delivery of each transaction to the Tax Administration, receiving JIR, printing the receipt and giving it to the buyer.
Delivery of daily reports to the Tax Administration.
The prescribed procedures are also used for receipt annulment, merchandise returns, food/drink container returns.
The possibility of verifying issued receipts for buyers via SMS or Web services.

What fiscalization procedures are important for subjects to fiscalization?

Getting a certificate
Certificate download instructions will be prescribed in a rule book
Adapting the cash register, i.e. the software, to fiscalization requirements
Testing the system / device function with the Tax Administration
Keep up with deadlines issued by the Republic of Croatia

What kind of hardware is required?

It is not possible to use cash registers which do not provide Internet connectivity.

Cash register
A cash register (US English) or till (British English) is a mechanical or electronic device for calculating and recording sales transactions and an attached cash drawer for storing cash. The cash register also usually prints a receipt for the customer.

Point of sale
POS (also sometimes referred to as point of purchase (POP) ) or checkout is the location where a transaction occurs. A "checkout" refers to a POS terminal or more generally to the hardware and software used for checkouts. IBM PCs and compatible models from other vendors are the most widely used computer systems in the world. They are typically single user personal computers (PC). It must have a network interface card for Internet connectivity.

Can I use an already existing FINA certificate?

No. These certificates must feature the name “Fiskal” which defines its purpose and relation to the Fiscalization Law (demo certificate).

How long is a certificate valid for?

This certificate is valid for 5 years.

What happens after 5 years?

The certificate is no longer valid and it needs to be reissued. The details regarding the reissuing procedure after 5 years will be available on time.

What is the prize competition?

Buyers will be rewarded for sending JIRs to the Tax Administration for verification. If a JIR hasn't been logged by the Tax Administration, and a buyer has the receipt with that particular JIR, then it is reasonable to assume tax evasion has occurred.

Competition rules have not been defined, i.e. how many times winners (i.e. the buyers who checked JIRs) will be chosen per year and what are the prizes.

What if communication / connection to the Tax Administration is interrupted?

The subject issues a receipt without the JIR
The receipt contains all other required elements (security code!)
A two-day deadline is allotted for subsequent transaction (issued receipt) and daily report delivery.

What is the purpose of JIR?

It confirms that the receipt has been logged by the Tax Administration
It can be used for buyers to verify receipts.

What if a malfunction occurs on the fiscal cash register?

Receipts will be issued according to the procedure for minor subjects to fiscalization (manual entry in the receipt book)
Deadline for reestablishing normal work is 2 days
Subsequently received JIRs must be written on the copies of receipts issued according to the procedure for minor subjects to fiscalization, according to Article 21 of the Fiscalization Bill.

How can issued fiscal receipts be verified?

The verification of issued fiscal receipts is done via:
The web service
SMS text messages

How can a fiscal cash register (POS) be reinstalled?

All printed documents containing payment media information (including cash, card payments, everything except bank account transfers) must have a unique, uninterrupted counter for each separate store and POS. This counter must be reset at beginning of each year.

It will be possible to verify which receipt number was the last, that was received by the Tax Administration and to continue with the actual counter after reinstalling the cash register.

Can I use the same certificate for multiple cash registers?

As this is a software certificate, there are no obstacles preventing its usage on multiple cash registers within the same taxpaying business subject.

What should be on a fiscal receipt?

OIB
Name
Date and time
Receipt number
Purchased items
Tax calculation
Tax sorting according to tax rates
Return fee amount
Operator ID
The issuer's security code
ID of the person who collected the money
Tax Administration's certificate of having received the online transaction (JIR), or, in offline mode, a special warning message

Who needs a FINA certificate?

IT companies participating in the implementation: demo application certificates
Subjects to fiscalization: production application certificates

Can the certificate be used only with Microsoft OS?

FINA certificates are in accordance with the X.509 v3 standard and the RFC 5280 recommendation which regulates usage of X.509 v3 certificates on the Internet. Application certificates which will be issued for the purpose of fiscalization are soft-form certificates and they can be used on various platforms. Certificates are in accordance with international standards and are not limited to any particular computer platform.

Who is FINA ?

The Financial Agency (FINA) is the leading Croatian company for financial mediation. National coverage, an IT system tested on the most demanding jobs of national importance and a high level of expert team professionalism make it possible to prepare and implement various projects, from simple financial transactions to the most sophisticated jobs in e-business. The only Certificate Policy authorized company in Croatia.

Who is APIS-IT?

The agency for IT system support and information technologies, APIS-IT ltd. is a company which works closely with the Republic of Croatia and the City of Zagreb. They have a long tradition and have developed very complex IT support systems for the City of Zagreb, and the Tax and Customs Administrations of the Ministry of Finance in the Republic of Croatia.

Who is HGK?

The Croatian Chamber of Economy (Hrvatska gospodarska komora, HGK) is an independent professional and business organization for all legal entities engaging in business. It was established in 1852, organized in European tradition and on the so-called continental model of Austrian and German chambers with compulsory membership

What is XML?

Extensible Markup Language (XML) is a markup language, that defines a set of rules for encoding documents in a format that is both human-readable and machine-readable. It is defined in the XML 1.0 Specification produced by the W3C and several other related specifications

What form does the certificate come in?

As a text file

What is the purpose of the security code?

Additional protection for the receipt issuer – a confirmed link between the issued receipt and the subject to fiscalization
An additional means of identification while in offline mode
It prevents buyers from forging receipts

Who can create the security code?

The POS software users can decide which algorithm to use, to generate the code.

Is a special certificate used for testing?

Yes, a demo certificate issued free of charge by FINA. The certificate is planned to be available for download during September 2012.

How will Helpdesk be organized?

FINA will provide support with procedures regarding the certificates, there will also be a special website, a special mailing group and a free hotline (to be published after the Law has passed)
The first line of support for business owners – service offered by IT service providers
APIS-IT second line of support – support for manufacturers / software developers in case of problems with connection towards the centralized system
Details about how to communicate with support are a part of the general technical instructions

What are the fiscalization deadlines?

FINA will provide support with procedures regarding the certificates, there will also be a special website, a special mailing group and a free hotline (to be published after the Law has passed)
The first line of support for business owners – service offered by IT service providers
APIS-IT second line of support – support for manufacturers / software developers in case of problems with connection towards the centralized system
Details about how to communicate with support are a part of the general technical instructions

Who will cover fiscalization costs?

All costs will be covered by the party, who wants to fiscalize their cash registers. There are no state subsidies.

The costs are:
Purchasing a cash register with IBM PC or other compatible models
Purchasing a certificate from FINA
Purchasing or modifying software according to fiscalization standards
Purchasing an Internet connection
Monthly Internet connection costs
Additional software maintenance costs (hiring a person for the IT department to carry out the work)

Who will cover the Internet connection costs?

The costs are covered by the subject to fiscalization and they can choose any ISP to sign a contract with.

Do bookkeeping specifics change?

The costs are covered by the subject to fiscalization and they can choose any ISP to sign a contract with.

Who is going to be a subject to fiscalization?

Natural persons who are obligated to pay the income tax on independent personal activities (craft trade and other equal services, free enterprises, and, under certain conditions, agriculture and forestry)

Natural persons who are obligated to pay the profit tax

Legal persons obligated to pay the profit tax (corporations and others), if they are obligated to issue receipts according to special regulations.

Persons who conduct business on a smaller scale, i.e. the natural persons whose income is determined in a flat rate according to the Income Tax Law, are considered to be minor subjects to fiscalization. These subjects will issue receipts that are pre-certified at the Tax Administration (a special receipt book marked in ordinal numbers and certified).

What is OIB?

The Personal Identification Number (OIB, Osobni identifikacijski broj) is a permanent ID number assigned to every Croatian citizen and every legal person registered in the Republic of Croatia. It is generated and assigned by the Ministry of Finance - Tax Administration.
The OIB will gradually replace all other numbers which have until now been used as ID numbers for legal and natural persons in the Republic of Croatia (MB and MBG, respectively).
The OIB is a randomly-generated 11-digit number, which contains no private information.
The OIB is generated and then assigned to the natural and legal persons at no expense to them.
http://oib.oib.hr/SaznajOibWeb/fizickaOsoba.html

 

Fiscal Law

http://fiscalization.hr/en/fiscal-law

 

 

 

 

 

TAXPAYER

CORPORATE INCOME TAX (01.03.2012)

 

1. A company or another legal or natural person resident in the Republic of Croatia, who is permanently and independently engaged in an economic activity for the purpose of deriving a profit, an income or a revenue or other assessable economic benefits.
2. A resident permanent establishment (an inland business unit) of a non-resident entrepreneur.
3. A natural person who derives income pursuant to the income tax regulations, if he/she declares that he/she intends to pay profit tax instead of income tax.
4. An entrepreneur – a natural person who derives income from small business or the activities equalized therewith, if:
  • total revenue in the preceding tax period exceeded of HRK 2,000,000,00 or
  • total income in the preceding tax period exceeded of HRK 400,000,00 or
  • the value of long-term assets exceeds HRK 2.000,000,00 or
  • employed more than 15 employees on average during the preceding tax period.
5. Exceptionally, the state administration bodies, bodies of regional and local self-government, the Croatian National Bank, state institutions, institutions of units of regional and local self-government, state institutes, religious communities, political parties, trade unions, chambers, civic organizations, artists associations, volunteer fire companies, technical culture communities, tourist boards, sports clubs, sports associations and unions, open-end investment funds established and operating in accordance with the law, endowments and foundations, if they carry out an economic activity and the non-taxation of this activity would result in their obtaining of unjustified privileges on the market, are liable to pay corporate income tax for this activity.
6. Every entrepreneur that is not classified among the entrepreneurs listed in Items 1 – 5 and is not liable to pay income tax according to the provisions of the Personal Income Tax Law and the profit of whom is not taxed elsewhere.
Note: Open-end investment funds established and operating in accordance with the law are not liable to pay corporate income tax (profit tax).
CORPORATE INCOME TAX BY WITHHOLDING
1. An inland paying agent that pays to foreign entities-recipients (non-residents) who are not natural persons,
2. The permanent establishments of a non-resident entrepreneur, when they pay to the parent company interest, as well as royalties and other intellectual property rights (copyright, patent, licensing, trade mark, design or pattern, production procedure, production formulas, draft, plan, industrial or scientific experience and similar rights). Exceptionally, the withholding tax shall not be paid if considerations are recognized as the revenues of a resident permanent establishment of a non-resident entrepreneur. The withholding tax shall be paid for all services paid to persons having their permanent establishment or headquarters in the countries, except for the European Union Member States, in which a general or average nominal profit taxation rate is lower that 12.5% and the country is published in the list of countries issued by the finance minister.
TAX BASE CORPORATE INCOME TAX
Profit determined pursuant to the accounting regulations as the difference between revenues and expenditures before the profit tax assessment, increased and reduced in accordance with the provisions of The Profit Tax Law.
CORPORATE INCOME TAX BY WITHHOLDING
Gross amount of a consideration paid by a resident payer to a non-resident recipient.
TAX RATE CORPORATE INCOME TAX
  20%
  CORPORATE INCOME TAX BY WITHHOLDING
  15%
20% for all services paid to persons having their permanent establishment or headquarters in the countries, except for the European Union Member States, in which a general or average nominal profit
taxation rate is lower that 12.5% and the country is published in the list of countries issued by the finance minister.
TAX REGULATIONS Profit Tax Act (Official Gazette of RC 'Narodne novine' No. 177/04, 90/05, 57/06, 80/10).
The Regulations concerning profit tax (Official Gazette of RC 'Narodne novine' No. 95/05, 133/07, 156/08, 146/09

  •  

 

 

End of year payment of 2012

 

December is usually a period of rewarding payments to employees.   Here is a summary of tax treatments of Christmas payments, buying gits of employees and children.

END OF YEAR PAYMENTS TO EMPLOYEES – UP TO 2.500 HRK PER YEAR

Pursuant to Income tax Law (published in official gazette, (NN 95/05, 96/06, 68/07, 146/08, 2/09,9/09-ispravak i 146/09, 123/10), in article 13. par. 2. Point 11 is regulated the possibility of payment of non taxable allowances and gifts to employees amounting to maximum of 2.500,00 HRK per year per employee (for example: Christmas allowances, holiday pay, and Easter allowance). Total adopted amount of 2500, 00 HRK could be divided into several payments during the year (for example: 1200,00 vacation payment, 1300 Christmas bonus/allowance). If the employer is rewarding employees several times during the year, and he uses the total of non-taxable amount of 2.500,00 HRK with the first payment, all otherpayments are treated as a salary. Annual allowance could be either paid in money (cash or via bank transfer to employee's current account) or as in-kind-gift.

GIFT TO CHILDREN UP TO 15 YEARS OLD – UP TO 600 HRK PER YEAR

Income tax Law (article 13, par. 2, point 10) has prescribed that the employer could pay non taxable amount up to 600,00 HRK per year as a gift to employee's children up to 15 years old i.e. children which till December 31st of current year are 15 years old. Each parent is entitled to this allowance.  The gift could be payable in money or in-kind (toys, sweets etc.) for all children no matter whether they are registered on parent's tax card or is the parent their health insurance contractor (if it is not differently prescribed by Collective Agreement or by Contract of employment).

GIFT IN KIND TO EMPLOYEE - UP TO 400 HRK PER YEAR

Pursuant to the regulations of Income tax Law (article 14, par 7) the employer could give in-kind-gift to the employee amounting to the value up to 400, 00 HRK per year (gross amount including VAT).

The gift in kind amounting to the value up to 400,00HRK per year can be exempt of tax only if is given in kind.

If the in-kind-gift is more than 400,00 HRK or the gift is paid in money, it is considered as an income and should be accordingly taxable as a salary in kind (all taxes, surtax and both employer's and employee's contributions should be paid).

  

Deadline for registration of employment to Croatian institue for pension insurance (2012)

 

The deadline for registration of employee to pensiohn insurance, registration of termination of employment or change during insurance, is 8 days.

If employer does not register insurance in prescribed dedeline or if employer does it after prescribed deadline of 8 days, he-she can be fined in  an amount ranging from 5000 to 50,000 kuna.  The responsible person of employer-legal entity shall be fined in an amount ranging from 1000 to 10,000 kuna. 

 

 

Minimum wage! (June1, 2012)

The gross amount of minimum wage from June 1, 2011 to May 30 2012 in the Republic of Croatia, is 2.814 HRK

 

 

 Croatian Accounting rules

Tax year
The fiscal year begins on January 1-st and ends on December 31 of the same year.
Accounting standards
In Croatia, International Financial Reporting Standards are mandatory for big companies and for those that have their bonds on the stock exchange market. All the others can also report respecting the rules set by Croatian Committee for Financial Reporting Standards, a 9-members professional body appointed by the government.
 
Accounting regulation bodies
Croatian Committee for Financial Reporting Standards (in Croatian only)
Croatian Ministry of Finance
Croatian Tax Administration Office
Croatian Financial Services Supervision Agency
International Financial Reporting Standards
Accounting reports
These documents must contain: a balance sheet, a profit and loss account, a cash-flow report, a review of the changes of the authorized capital, comments and annexes.
 
Publication requirements
 
The Croatian entrepreneurs are subjected to the obligation of information about their financial situation. The documents of financial information must be drafted in Croatian and expressed in the national currency (the Croatian kunas) usually once per calendar year. A business year can be different from the calendar year only if there is an exception or if the activity is a seasonal one. The account book and the ledger must be kept up to date and then kept during at least 11 years.

 

 

 

 

Actarius Grupa d.o.o., Badalićeva 25,10000 Zagreb

Tel 01/382-0010, Mob 091/382-0015, Fax 01/382-0010
Email: info@actarius.hr website: http://www.actarius.hr

 
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