Tax system

Tax treatment for residents and non-residents is equalized, and when taxing non-residents, the concluded agreements on avoidance of double taxation, which Croatia has signed with over 60 countries, are also taken into account.

Basic forms of taxes in the tax system of the Republic of Croatia:

Type of tax Tax rate
Corporate Income Tax  (Profit Tax)

  • 10% for revenues up to HRK 7,500,000.00 generated in the tax period or
  • 18% for the revenues generated in the tax period are equal to or greater than HRK 7,500,000.01.
10% and 18%
Income tax rate on withholding tax:

  • 15% in general
  • 10% for dividends and profit shares and for performances by foreign performers
  • 20% on all services and all types of fees taxable when paid to persons who have their registered office, headquarters or supervision in the countries listed on the EU list of non-cooperative jurisdictions for tax purposes and to which the Republic of Croatia does not apply the double taxation avoidance contract.
10%

15%

20%

Capital income tax

Capital income tax on the basis of interest, as well as capital income tax on the basis of capital gains is paid at the rate of 10%.

Income Tax Act (OG 115/16, 106/18, 121/19, 32/20, 138/20)

10%
Income Tax and Surtax

 Income Tax rate is:

  • 20% for income to 360,000 HRK / 47,745.36 EUR per year (up to 30,000 HRK / 3,978.78 EUR per month)
  • 30% for income above 360,000 HRK / 47,745.36 EUR per year (above 30,000 HRK / 3,978.78 EUR per month)

1 EUR = 7.54 HRK

In the addition to income tax, the taxpayer also pays surtax on income tax, stipulated by municipalities and cities. The basis for the surtax calculation is the amount of income tax. The surtax rates range (as shown below) from 0% to 18%, with the highest rate applied only in Zagreb (18%).

Surtax Rates Range:

  • Municipalities up to 10%
  • Cities below 30,000 inhabitants up to 12%
  • Cities over 30,000 inhabitants up to 15%
  • City of Zagreb up to 18%
20% and 30%
Value Added Tax (VAT)

When calculating VAT, in accordance with the Value Added Tax Act (OG 73/13, 148/13, 143/14, 115/16, 106/18, 121/19, 138/20, 39/22), three rates are applied:

(1) 25% is general rate

(2) Reduced VAT rate of 5% is applied for following goods and services:

a) all types of bread,

b) all types of milk (cow’s, sheep’s, goat’s) placed on the market under the same name in liquid form, fresh, pasteurized, homogenised, condensed (excluding sour milk, yoghurt, kefir, chocolate milk and other milk products), substitutes for breast milk,

c) books of professional, scientific, artistic, cultural and educational content, textbooks for pedagogical education, for primary, secondary and higher education, except for those which contain or serve advertising in whole or in part and other than those which are entirely or they mostly consist of videos or music content,

d) medicinal products authorized by the competent authority for medicinal products and medical devices,

e) medical equipment, aids and other devices used to alleviate the treatment of disability exclusively for the personal use of the disabled prescribed by the general act on orthopaedic and other aids of the Croatian Health Insurance Institute,

f) cinema tickets, tickets for concerts, sports events and cultural events, other than cultural services and closely related supplies of goods, performed by cultural institutions, public authorities or other legal entities in culture exempt from VAT,

g) newspapers of a newspaper publisher having a media statute, which are published daily, other than those which contain or serve advertising in whole or in part and other than those which consist, in whole or in part video or music content,

h) scientific journals,

i) baby food and processed cereal-based foods for infants and young children,

j) edible oils and fats, of vegetable and animal origin, butter and margarine,

k) delivery of live animals: cattle, pigs, sheep, goats, horses, donkeys, domestic poultry, hares and rabbits

l) delivery of fresh or chilled meat and edible slaughter products from: cattle, pigs, sheep, goats, horses, donkeys, domestic poultry, hares and rabbits,

m) delivery of fresh or chilled sausages and similar meat products, meat slaughter products or blood,

n) delivery of live fish,

o) delivery of fresh or chilled fish, molluscs and other aquatic invertebrates,

p) delivery of fresh or chilled crabs: lobster, European lobster, shrimp, shrimp,

r) delivery of fresh or chilled vegetables, roots and tubers, including leguminous dried vegetables,

s) delivery of fresh and dried fruits and nuts,

t) delivery of fresh poultry eggs, in shell,

u) seedlings and seeds,

v) fertilizers and pesticides and other agrochemical products,

z) products mainly used as animal feed, except pet food,

ž) supply of natural gas, including charges related to that supply (exceptionally, during the period from April 1, 2022 to March 31, 2023)

(3) Reduced VAT rate of 13% is applied for following goods and services:

a) accommodation services and accommodation with breakfast, half board or full board services in hotels or similar purpose facilities, including holiday accommodation, accommodation rental in holiday camps or places designated for camping and accommodation in nautical tourism vessels,

b) newspapers and magazines of a newspaper publisher with a media statute and newspapers and magazines of a publisher without obligation to adopt a media statute pursuant to special regulation, other than those referred to in Item 2 g), which publish periodically, other than those which contain or serve advertising in whole or in part and other than those which consist in whole or in part of video or music content

c) child car seats and baby diapers,

d) menstrual supplies,

e) water supply, except water placed on the market in bottles or other packaging, in sense of public water supply and public drainage pursuant to special regulation,

f) electricity supply to another supplier or final user, including charges related to that supply,

g) supply of natural gas and heating from heating stations, including charges related to those supplies,

h) firewood, pellets, briquettes and wood chips,

i) public service of mixed municipal waste collection, biodegradable municipal waste and separate waste collection pursuant to a special regulation,

j) urns and coffins,

k) services and related copyrights of writers, composers and performers and holders of phonogram rights who are members of appropriate collective management organizations performing this activity pursuant to special regulations in the copyright field and related rights and with the prior approval of state administration body responsible for intellectual property,

l) preparation and serving of dishes and desserts in the catering facility and outside the catering facility pursuant to a special regulation.

Value Added Tax Act (OG 73/13, 148/13, 143/14, 115/16, 106/18, 121/19, 138/20, 39/22)

25%
Real Estate Transfer Tax

Real estate Transfer Tax rate is 3% and is paid by the buyer.

The tax base is the market value of the property at the time of the tax liability. The market value of a property is the price of a real estate that is achieved or can be achieved on the market at the moment of the tax liability. Object of taxation is a real estate transaction. The real estate transfer is not considered to be the acquisition of real estate for which the value added tax (VAT) is payable.

3%

For more information, please contact the Croatian Ministry of Finance:

Ministry of Finance – Tax Administration
Boškovićeva 5
10 000 Zagreb
Telefon: 01 4809 000

www.mfin.gov.hr