Croatian VAT rates and VAT compliance - Avalara

Croatian VAT rates

Croatia follows EU rules on value added tax (VAT) compliance; however, it is free to set its own standard (upper) VAT rate, which is currently set at 25%. Suppliers of goods or services registered for VAT in Croatia must charge the appropriate VAT rate, and collect the tax for onward payment to the Croatian tax authorities through a VAT filing.

The current rates are:

Croatia VAT

Rate	Type	Which goods and services
25%	Standard	All other taxable goods and services
13%	Reduced	Some foodstuffs; water supplies (excluding bottled water); newspapers (other than daily published newspapers with less than 50% advertising content); periodicals (magazines other than science periodicals with less than 50% advertising content); tickets for concerts; hotel accommodation; café, restaurant, and hotel services (excluding alcohol); some agricultural inputs; certain undertaker and cremation services supplies; children’s car seats; electricity supply; some writers and composers services; some domestic waste collection
5%	Reduced	Some foodstuffs (including bread, milk, and infant formula); pharmaceutical products (only approved medicines prescribed by a doctor); some medical equipment; books (including e-books); daily newspapers (with less than 50% advertising content); scientific periodicals; cinema admission
0%	Zero	Intra-community and international transport (excluding road and rail)

Registering for VAT in Croatia

Businesses based in Croatia must register for VAT if their annual turnover exceeds €40,000. There is no threshold for non-resident (overseas) businesses. Businesses must register for VAT in Croatia as soon as they begin operating in the country, regardless of turnover.

EU businesses selling cross-border into Croatia must register for VAT if their annual sales into the country exceed €10,000.

Applications for VAT registration must be made to the Croatian Tax Administration by post. If all requested documents are included within the submission and the application is approved, businesses should receive a Croatian VAT number within two weeks.

Fiscal representation in Croatia

Non-EU businesses selling into Croatia must appoint a fiscal representative — the appointed fiscal representative will be jointly responsible for the business’s VAT compliance.

Croatian VAT return filing

VAT filings in Croatia are typically made on a monthly basis. Businesses with a turnover below €105,000 and no intra-community acquisitions can file quarterly returns. VAT filings must be made electronically via the Croatian e-Porezna portal. Returns are due by the 20th of the month following the reporting period.

Penalties

Penalties for late filing include fines of up to €66,400. Penalties for late payment incur interest of 5.89%.

Croatian VAT Compliance

Once registered for VAT in Croatia, businesses must follow compliance rules. These include:

Issuing invoices with the disclosure details outlined in the Croatian VAT Act
Using electronic invoices (when necessary) with proper signature, authenticity, and agreement by the recipient
Maintenance of accounts and records, which must be held for at least 10 years
Correct invoicing of customers for goods or services in accordance with the Croatian time of supply VAT rules
Processing of credit notes and other corrections
Use of approved foreign currency rates

What is the tax point for Croatian VAT?

The tax point (time of supply) rules in Croatia determine when the VAT is due.

For goods where a VAT invoice has not been issued, i.e. most B2C transactions, the tax point is generally the physical supply of the goods or the payment, whichever is earlier. For goods supplies where an invoice is issued, i.e. most B2B transactions, the tax point is generally deemed to be the invoice date regardless of when the actual supply took place.

For the supply of services where no VAT invoice is issued, i.e. B2C services, the tax point is usually considered to be the time when the service is delivered to the customer or the payment, whichever takes place earlier. In the case of longer B2C services, the tax point occurs when the service has been completed. For service supply where a VAT invoice is issued, i.e. B2B services, the tax point occurs on the invoice date regardless of when the supply occurred.

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