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Summary

Standard VAT rate: 25%
E-Invoicing: live for B2G, permitted but not mandatory for B2B and B2C
Real-time reporting: mandatory for all cash transactions
Digital service tax: no

Compliance and rates

 

VAT number format

All EU member states have a fixed format for their VAT numbers. In Croatia it includes 11 digits and the prefix HR (i.e. HR 01234567890).

 

VAT rates

The standard VAT rate in Croatia is 25%, with reduced rates of 13% and 5% on certain goods and services.

25% (Standard) – Applies to all taxable supplies, with certain exceptions

13% (Reduced) – Some foodstuffs (fresh or chilled meat and fish), acommodation, concert tickets, supply of live animals and some agricultural supplies

5% (Reduced) – Some foodstuffs (e.g. bread, dairy products, meats, baby food), books of a scholarly, scientific, artistic, cultural, and educational character, certain medicines and medical equipment and accessories, daily newspapers and cinema tickets.

0% (Zero) – Exportations

 

VAT payments and returns

All businesses with Croatian VAT number must submit periodic VAT reports and payments.

VAT Returns frequency

For all companies that operate in Croatia, VAT returns must be submitted on a monthly basis or quarterly basis, depending on the annual revenue of the business entity.

Monthly – by the 20th of the following month if the annual revenue is higher than HRK 800,000 (EUR 106,000).

Quarterly – by the 20th of the following month if the annual revenue is less than HRK 800,000 (EUR 106,000).

Penalties in case of late filings or misdeclarations

Non-registration and/or late registration are subject to fines of HRK 1,000 – HRK 200,000 (EUR 130 – EUR 27,000) for the business entity, and HRK 500 – HRK 40,000 (EUR 75 – EUR 5,300) for the responsible person.

Non-payment and/or late payment of the VAT may lead to the following penalties:

1) For failure to pay VAT the penalty is between HRK 2,000 and HRK 500,000 (EUR 260 and EUR 67,000) for the business entity, and from HRK 1,000 to HRK 50,000 (EUR 130 – EUR 6,700) for the responsible person.

2) Late payment of VAT:

  • an interest-penalty at the annual rate of 12% may be imposed to the taxpayer (applicable until 1 August)
  • from 1 August to 31 December, the applicable penalty interest is 8,14%
  • from 1 January to 30 June, the applicable penalty interest is 8,05%
  • from 1 July to 31 December, the applicable penalty interest is 7,88%

Submission of incomplete and/or incorrect VAT returns, non-submission and/or late submission of VAT returns are subject to fines from HRK 2,000 to HRK 500,000 (EUR 260 to EUR 67,000) for the business entity and between HRK 1,000 and HRK 50,000 (EUR 130 and EUR 6,700) for the taxpayer’s responsible person.

 

Invoice requirements

Invoices must contain at least the following information:

  • place and date of issuance
  • a unique, sequential number of the invoice
  • supplier / issuer data (company name, address, tax number)
  • customer data (address and other data if available, tax number)
  • full description of goods and services provided
  • quantity of goods and services provided
  • net price per unit
  • shipping date
  • the net, taxable value of the invoice
  • rate and amount of VAT applicable for the category of goods and services provided
  • the invoice total, gross amount
Penalties for non-compliance with invoicing and accounting obligations

Non-compliance with invoicing and accounting obligations will be penaltied from HRK 2,000 to HRK 500,000 for the business entity and from HRK 1,000 to HRK 500,000 for the taxpayer’s responsible person.

E-Invoicing

From 2018, all invoices in public procurement must be issued electronically. B2B and B2C electronic invoicing is permitted, but currently not mandatory.

Real-time reporting (fiscalization)

Real-time reporting to Croatian Tax Authorities (Porezna Uprava) is mandatory for all transactions made in cash.

This process of real-time reporting is called ‘fiskalizacija‘ (eng. Fiscalization) and works as described below:

1. The entrepreneur sends an electronically signed XML data message about the transaction to The Croatian Tax Authority (Porezna uprava). This XML data message must include also automatically generated issuer’s security number (ZKI – zaštitni kod izdavatelja)

2. Croatian Tax Authority (Porezna uprava) checks the XML message, add unique invoice identity code (JIR – jedinstveni identifikator računa) and sends back confirmation to the entrepreneur

3. Entrepreneur issues a receipt (including the JIR and ZKI numbers) and provides it to the customer.

4. The customer receives the receipt.

5. Registration of the sale can be verified through the web application of the Tax Authority. The customer can verify the authenticity of the received invoice.

Who is affected by this obligation?

All taxable persons that receive cash as a payment method for goods or services provided to buyer.

Turnkey invoice compliance.

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