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Corporate tax

Tax rate for resident companies


Tax rate on long-term capital gains Capital gains are included in taxable income and subject tot tax at the normal corporate income tax rate.
System governing groups of companies and dividends paid by subsidiaries to their parent companies A 15% withholding tax is imposed on dividends paid by Croatian companies to foreign legal entities.
Tax rate on branches Branches of foreign companies are taxed at a rate of 20% only on their income derived from Croatia.

Income tax

Fiscal year The fiscal year begins on January 1-st and ends on December 31 of the same year.
Income tax rate Personal Income Tax Schedule 2006:
Lower than 38,400 Hkr 15%
From 38,400 Hkr to 96,000 Hkr 25%
From 96,000 Hkr to 268,800 Hkr 35%
Beyond 268,800 Hkr 45%

VAT rates

Standard rates 22%
Reduced rates 0% on bread, milk, technical and educational books, medecines (approved by the national state health insurance office), surgical material for implants, scientific magazines, national film department.
10% on housing services

Other important taxes

Name of tax
Municipal Income Surtax  
up to 30%  
Real Estate Sales Tax  
Forested tax of brown profits  



The law principles concerning accounting and audit were published in the official gazette of the Croatian Republic in 2005. This law has been implemented since January 01, 2006. It gives the obligations in terms of book-keeping which are inspired by international accounting standards.

General accounting principles
The registration of the accounts operations must be made during the financial year which often corresponds to the calendar year. The account book and the ledger must be kept up to date and then kept during at least 11 years.
The accounts structure of companies in Croatia refers to the model of the International Accounting Standards Committee.

Obligations and publications
The Croatian entrepreneurs are subjected to the obligation of information about their financial situation. The documents of financial information must be drafted in Croatian and expressed in the national currency: the Croatian kunas.
These documents must contain: a balance sheet, a profit and loss account, a review of the changes of the authorized capital, comments and annexes.

Certification and auditing
The financial documents of firms with more than 30 million croatian kunas annual sales should be checked by an independent external auditor who will have the responsibility to guarantee the sincerity and the accuracy of the given information.

Professionals and representative organizations
" Croatian Association of Accountants and Financial Experts ".

Useful links
For further information, consult the very exhaustive web site of Tax Administration in Croatia.

Last modified in March 2007
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