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Croatia has made strides in equalizing the tax treatment for both residents and non-residents. The agreements signed with over 65 countries to prevent double taxation play a crucial role in this regard, ensuring that all taxpayers are treated fairly.
Overview of Croatia’s Key Taxes
To help taxpayers navigate the Croatian tax landscape, here are the primary types of taxes, along with their respective rates:
| Type of Tax | Tax Rate |
|---|---|
| Corporate Income Tax (Profit Tax) | 10% for revenues up to €1 million; 18% for revenues of €1 million or more. |
| Withholding Tax on Income | 15% in general; 10% for dividends and performers; 25% for certain taxable fees and services. |
| Capital Income Tax | 12% on interest and capital gains. |
| Income Tax | 15%-23% for income up to €5,000 monthly; 25%-33% for income exceeding €5,000 monthly. |
| Value Added Tax (VAT) | 0%, 5%, 13%, and 25% applicable depending on the goods and services. |
| Real Estate Transfer Tax | 3% on property transfers (not applicable for real estate subject to VAT). |
Corporate and Personal Income Taxes
- Corporate Income Tax: Depending on the revenue generated, businesses may pay 10% if their earnings are under €1 million, while a rate of 18% applies to those generating €1 million or more.
- Withholding Tax: This category includes varied rates. A general withholding tax of 15% is standard, with a lower rate of 10% for certain dividends. Specific fees may incur a 25% rate, primarily for services provided by entities in non-cooperative jurisdictions.
- Income Tax: Individuals will find the structure progressive, ranging from 15% to 23% for lower brackets and up to 33% for higher income levels. An additional tax on final income applies based on the source and type of income.
Value Added Tax (VAT) Rates
VAT in Croatia is structured around several rates:
- 25% is the standard rate.
- 13% applies to accommodation services, energy supplies, and select food items effective from April 2025.
- 5% is designated for essential products such as bread and milk.
- There’s also a 0% rate for the delivery and installation of solar panels.
Real Estate Transfer Tax
The Real Estate Transfer Tax is set at 3%, but this does not apply to properties already subject to VAT. This is significant for individuals and businesses engaging in property transactions.
Further Assistance
For those seeking more detailed information about the Croatian tax system, please reach out to the Croatian Ministry of Finance:
- Address: Boškovićeva 5, 10 000 Zagreb
- Phone: +385 1 4809 000
Whether you are a resident or non-resident, understanding these tax regulations is essential to ensuring compliance and optimizing your financial responsibilities in Croatia.
Read More: How Croatia’s New Tax Laws Affect You in 2025?
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