Tax related FAQ

1. What is the VAT (PDV) in Croatia?

The Croatian Value Added Tax rate is set at 23%
The Croatian government increased the VAT (value ad dated tax) from 22 to 23% on the 1st of August 2009 having in plan to reduce it again down by the end of the next year (2010) which is planning to charge by that percentage by the end of next year.

2. How much is the real estate transfer tax rate in Croatia?

Tax in Croatia (sales tax , transfer tax or inheritance tax) is set at 5% for all types of real estate transactions. The local tax authorities will estimate their own evaluation of the property based upon the market real estate prices.

3. When trading properties, what is the real estate transfer tax?

When trading properties both parties are considered as buyers and they both pay 5% tax.

4. What is the Capital Gain Tax in Croatia?

If one decides to sell the property within the 3 years from the purchase date the capital gain tax of 20% will apply.

5. Are there any fees to be paid for owning a property in Croatia?

The county and the municipality charge holiday home tax which is paid by every physical owner (including the foreign citizens) or legal entity who owns holiday home. The holiday house taxation is calculated per m² of the living area and ranges between 5 and 15 HRK (0,65 - 2,20 EUR).

6. Does Croatia have double taxation treaties with other countries?

“Croatia currently has a treaty for the avoidance of double taxation of income and property ratified and in effect with the following countries”:
Albania, Austria, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Canada, Chile, China, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Israel*, Italy, Jordan, Latvia, Lithuania, Macedonia, Malaysia, Malta, Mauritius, Moldova, Montenegro, Netherlands, Norway, Poland, Republic of Korea, Romania, Russia, San Marino, Serbia, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, Turkey, Ukraine, United Kingdom

* Please note that the DTT is effective as of 1 January 2008.
Source: Ministry of Foreign Affairs web site, http://www.mvpei.hr/
For more information on taxes, additional costs and fees, in Croatia contact us directly by email.