Tax rates
Standard VAT rate: 25 %
Reduced rate 13 % for
- accommodation services
- periodicals
- supply of water except bottled water
- preparing and serving meals and desserts in and out of restaurants
- services and related copyrights of writers, composers and artist performers and holders of phonogram rights
- children car seats and babies' napkins, menstrual (women needs) supplies
- supply of electricity, natural gas, distrinct heating services, fuel wood, pellets, briquettes and chipped wood
Reduced rate 5 %, e.g. for
- daily newspapers, cinema tickets, concert tickets, tickets for sport and cultural events
- books, scientific publications
- certain pharmaceuticals
- all types of bread and milk,
- children’s food, edible oils and fats
- supply of live animals, fish, vegetables, fruits, nuts, eggs etc,
- plants and seeds, agrochemical products
Supply of goods
Place of supply of goods
The place of supply of goods not dispatched or transported shall be the place where the goods are located at the moment of supply (static supply).
The place of supply of goods dispatched or transported by the supplier, buyer or a third person shall refer to the place where the goods are located at the beginning of the dispatch or transport to the buyer (moving supply).
Importation from third country: The place of import of goods is the Member State on whose territory the goods are located at the time of entry into the European Union.
Special provisions for chain and triangular transactions.
- Current distance sales thresholds are replaced with an annual threshold of EUR 10,000, and once the threshold EUR 10,000 is reached the distance sale supplies will be taxed in the Member State in which the non-taxpayer recipient of goods has residence.
- Special taxation procedure for the distance sale of goods within the European Union, for supplies of goods within a Member State which provide electronic interfaces enabling such supplies and for services supplied by taxable persons established within the European Union but not established in the Member State of consumption.
- If the distance sale of goods is enabled through an electronic interface and the goods are imported from third territories or third countries in parcels which have a value of not more than EUR 150 or if the distance sale of goods within the European Union is conducted by a taxpayer without residence in the European Union, the supplier is deemed to be the taxpayer, which enables the sale though its electronic interface.
Supply of services
Supply of services and private use / supply of services without consideration (self-supply) are taxable
Place of supply of services
Differentiation is made between services rendered
- to taxable persons (“Business to Business”, “B2B”) or
- to non-taxable persons (“Business to Customer”, “B2C”).
A taxable person who also carries out activities or transactions that are not considered to be taxable supplies of goods or services in accordance with Article 4(1) shall be regarded as a taxable person in respect of all services rendered to him. A non-taxable legal person who is identified for VAT purposes shall also be regarded as a taxable person.
Basic rule
| B2B |
B2C |
| Place of recipient
(Place where the recipient of services has established his business) |
Place of supplier
(Place where the supplier of services has established his business) |
Special cases
|
B2B |
B2C |
| Supplies of services by intermediaries |
Basic rule |
Place of the underlying transaction |
| Property services |
Place of the property |
Place of the property |
| Cultural, artistic, scientific, educational, sports, entertainment or similar services, like services in connection with fairs and exhibitions including services of the respective organizers; not applicable to admission and related services |
Basic rule |
Where the services are physically carried out |
| Admission and other relating services for events like fairs and exhibitions |
Where the services are physically carried out |
Where the services are physically carried out |
| Passenger transport |
Distances covered |
Distances covered |
| Transportation of goods (without intra-Community goods transportation) |
Basic rule |
Distances covered or place of departure of the transport (for intra-community goods transportation) |
| intra-Community goods transportation |
Basic rule |
Place of departure |
| Ancillary transport services |
Basic rule |
Where the services are physically carried out |
| Appraisal and processing of movable tangible objects |
Basic rule |
Where the services are physically carried out |
| Restaurant and catering services |
Where the services are physically carried out |
Where the services are physically carried out |
| Restaurant and catering services in connection with intra-Community passenger transport |
Where the services are physically carried out |
Where the services are physically carried out |
| Renting of means of transport for up to 30 days |
Where the means of transport is actually put at the disposal of the customer |
Where the means of transport is actually put at the disposal of the customer |
| Renting of means of transport for over 30 days |
Basic rule |
Place of recipient
Special regulations for renting pleasure boats |
| “Listed services” to third country customers 1) |
Basic rule |
Basic rule (place of recipient if established outside the EU) |
| “Listed services” to customers in the EU |
Basic rule |
Place of recipient |
| Electronically supplied services, such as telecom, radio and TV services 2) |
Basic rule |
Place of recipient |
Mini-One-Stop-Shop (MOSS) / One-Stop-Shop (OSS)
The special regulation can then be applied to all supplies of services which are provided to consumers, if certain conditions are met. Additionally, the MOSS system is applicable for intra-community supplies to consumers, supplies of goods facilitated by electronic platforms and imports of up to EUR 150.
Reverse charge (reversal of tax liability)
For all supplies of services and work supply
Requirements
Supplier is a foreigner (no residence, no place of business or permanent establishment in Croatia involved in providing the service).
Customer is an entrepreneur (even with non-taxable activities) or tax-exempt legal entity holding a VAT identification number, or a legal entity under public law
Consequences
Invoice without VAT
The recipient owes the VAT
Application also
N/A
Tax reliefs
Exemption (Input VAT deductible even though no VAT chargeable on supply of goods and services)
- Granting and administration of loans, insurance activities
- Postal services
- Services of hospitals and nursing institutions
- Sales of doctors, dentists, midwives etc.
- Small businesses (total net sales not exceeding EUR 60,000), previous EUR 40,000
Zero rates (non-genuine tax exemption) (Input VAT is not deductible)
- Exports of goods
- Cross-border goods transportation
- Cross-border passenger transport by boat and aircraft
- Mediation of the above transaction
- Supply and installation of solar panels on private residential buildings, residential premises and public and other buildings used for activities of public interest, as well as the supply and installation of solar panels near such buildings and premises
Deductible input VAT
VAT invoiced to the business for the supply of goods and services for business purposes.
Input VAT correction
If conditions that were relevant for input tax deduction in the calendar year in which an economic good was acquired or manufactured change in relation to that economic good within five years including the calendar year of acquisition or manufacture, input tax correction shall be made for the period after the change. A change in conditions relevant for input tax deduction shall refer to a subsequent change in those conditions that led to greater or lesser right to input tax deduction compared to the year in which the good was acquired or manufactured. A ten-year period shall apply instead of the five-year period for real estate.
Input tax correction shall not be necessary if the input tax to be corrected amounts to less than EUR 135 per one economic good.
Real estate
Rentals
Renting of immovable property is subject to VAT.
Exception:
Renting for residential purposes is tax exempt.
Sales
Principally: revenues from the sale of buildings are subject to 25 % VAT. Sale of property (buildings and associated land), if not used within two years from the acquisition or construction or option was executed
Refund of input VAT or Croatian taxable persons within the EU
Via electronic system for VAT refund.
Foreign taxable persons
Taxable persons without domicile or permanent establishment in Croatia.
Registration
Registration required if place of supply is in Croatia and reverse charge is not applicable.
Refund of input VAT for taxable persons domiciled in the EU
Via electronic system for VAT refund, filed by 30 September of the following year.
Refund of input VAT for taxable persons not domiciled in the EU
If no sales are made in Croatia, refund must be applied via home-country tax office by 30 June of the following year at the latest.
Original invoices, certificate of domicile for VAT purposes
Minimum refundable input VAT amount: EUR 50
