Import Procedures

A Croatian importer is responsible for providing the required import documentation, which consists of common trade, transport, and customs documents, as well as certificates required for quality control and licenses where appropriate. The Single Administrative Document (SAD) that is used by the EU and most other countries is the key customs document in Croatia as well.

As part of the "SAFE" standards set forth by the World Customs Organization (WCO), the European Union has set up a new system of import controls, the "Import Control System" (ICS), which aims to secure the flow of goods at the time of their entry into the customs territory of the EU. This control system, part of the Community Program eCustoms, has been in effect since 1 January 2011. Since then, operators are required to pass an Entry Summary Declaration (ENS) to the customs of the country of entry, prior to the introduction of goods into the customs territory of the European Union.

Croatia is a member of the CEFTA (Central European Free Trade Association) as well as the WTO (World Trade Organization) and has signed agreements of free trade with the countries of CEFTA and Turkey.

For more information, please visit the Croatian Customs website.

Distribution market players

There are an estimated 7,500 retail outlets in Croatia (including kiosks, small shops and open markets). Recently, newly developed shopping centres (such as Importanne, King Cross, Kaptol Centar, Avenue Mall, City Centar One, West Gate, Garden Mall and Arena Centar in Zagreb), supermarkets and modernised national retail chains newly established (such as Konzum, Dinova-Diona, Prehrana, Plodine) and foreign chains (such as Billa, DM, Mercatone, Metro, Bauhaus, Baumax, Kaufland, Lidl and Interspar) have become dominant players in the market. (ITA, 2019 latest data available)
In early 2017, the largest chain store Konzum, whose parent company is Agrokor, faced major financial difficulties. The Croatian government intervened to prevent bankruptcy and appointed a commissioner to help creditors restructure the company.
There is an increasing trend towards internationalisation and concentration in the sector, including the development of shopping centres, department stores and the establishment of international hypermarket chains.

Consumption Taxes

Nature of the Tax

Value Added Tax - Porez na dodanu vrijednost (PDV)

Tax Rate

25%

Reduced Tax Rate

Exempt: public interest activities, postal service, hospital services and health care services, social care services, financial services, insurance transactions, real estate transactions.

5%: bread, milk, technical and educational books, medicine (approved by the State Health Insurance Office), surgical material for implants, scientific magazines, cinema tickets.

13%: on accommodation services, daily and periodic newspapers/magazines (if not for advertising purposes), oils and fats for human consumption in accordance with special legislation, supply of water (with the exception of water marketed in bottles or any other packaging), white sugar produced from sugar cane or sugar beet, concert tickets, restaurants and catering services, urns and coffins, seedlings and seeds, fertilizers and pesticides and other agrochemical products, animal food, excluding food for pets, live animals, fresh or cooled meat, fresh meat products, fresh fish, fresh crabs, fresh vegetables, fresh fruit and nuts, fresh eggs, writers, composers and artists’ services and related royalties, etc.

Other Consumption Taxes

Excise taxes are levied on oil products, tobacco, alcoholic beverages, soft drinks, coffee, electricity, natural gas, cole and coke, personal cars (except for electric cars) and luxury products.
Slot machines are subject to a HRK 100.00 monthly tax per machine.

Corporate Taxes

Company Tax

18%

Tax Rate For Foreign Companies

Non-residents are only taxed on their Croatia-source income.

Capital Gains Taxation

Capital gains are included in taxable income and taxed at the standard corporate income tax rate of 18% (or 10% for companies whose annual income is below HRK 7.5 million).

Main Allowable Deductions and Tax Credits

Amortisation of tangible and intangible assets is tax-deductible at rates ranging from 5% to 50%. Land, financial assets, cultural monuments and works of art are not affected by this depreciation. Goodwill cannot be amortised for tax purposes.
Start-up expenses can be deducted in the year in which they were incurred.
Interest charges are deductible up to the rate published by the Croatian National Bank (3% for 2021). The deductibility of interest is limited to the higher of 30% of taxpayer's earnings before interest, tax, depreciation, and amortisation (EBITDA), or to EUR 3 million. Interest expenses that cannot be deducted in their year of occurrence may be carried forward to a period of three years.
Bad debts are generally deductible. Receivable write-offs that are made in line with the regulations on bankruptcy that apply to special interest entities, are also deductible.
Donations to charitable organisations are deductible up to 2% of the previous year's taxable income. This rate can be exceptionally higher if donations are made according to ministerial policies on the funding of special activities or programmes.
Fines and taxes are not tax-deductible.
Tax losses can be carried forward up to five years. The carryback of losses is not permitted.

Other Corporate Taxes

The purchase of real estate is subject to a property transfer tax of 3% of the market value of the property in question. The acquisition of property subject to VAT is exempt from property transfer tax. There is no regular property tax to pay.
Social security contributions payable by the employer amount to 16.5% of salary. Companies with more than 20 employees not complying with prescribed requirements for disabled employees are obligated to pay a monthly fee amounting to 30% of minimal salary (EUR 562 in 2021).
Employers are not liable for payroll tax, but they are required to withhold between 24% and 36% of their employees' gross income.
The annual membership fee to the Croatian Chamber of Commerce (mandatory) varies between HRK 42 and HRK 3,973 depending on the type of company.
No stamp duties are levied in Croatia. Companies may be subject to forest contributions, tourism contributions, and cultural monument contributions.

Other Domestic Resources

Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed

See the list of the Double Taxation Agreements

Withholding Taxes

Dividends: 0 (resident company)/10%/20% (if paid to a company in a blacklisted country)/10% (for individuals), Interest: 0 (resident company)/15%/20% (if paid to a company in a blacklisted country)/10% (for individuals), Royalties: 0 (resident company)/15%/20% (if paid to a company in a blacklisted country)/20% (for individuals).