Reverse Charge & “Call Off Stock” in Croatia

In cases where the reverse charge mechanism is applicable, the responsibility to report and pay VAT in Croatia is transferred from the supplier to the taxable recipient. If the recipient is only engaged in taxable supplies, there is no cost involved, as the input tax and output tax offset each other.

However, if the recipient also makes exempt supplies, only a portion of the input tax credit can be recovered in line with the “deductible proportion” rules.

Read more about Reverse Charge and “Call-off stock” in Croatia in our comprehensive guide below.

VAT guide croatia information

Reverse Charge in Croatia

The reverse charge is commonly applied to cross-border services, as well as certain domestic business-to-business supplies that are deemed to pose a higher risk of tax evasion. The liability also extends to importers and registered persons who make intra-Community acquisitions in Croatia.

Cross-Border Supplies

A taxable person who is not registered for VAT in Croatia supplies services to a VAT-registered recipient, the recipient is responsible for accounting for VAT using the reverse charge mechanism. This applies to both taxable persons and legal entities that are registered in Croatia. Additionally, if goods are imported into Croatia from an EU Member State or a third country and require installation or assembly in Croatia, the taxable recipient is liable for VAT.

Domestic Reverse Charge

Article 75(3) of the Croatian VAT Act provides for the “domestic reverse charge” rules, which apply the reverse charge mechanism to certain supplies made domestically or cross-border to recipients registered for Croatian VAT. These supplies include:

  • Construction work such as repair, cleaning, maintenance, alteration or demolition of immovable property, as well as related provision of staff.
  • Certain supplies of used material, nonreusable material, scrap, industrial and nonindustrial waste, recyclable waste, part processed waste, goods, and services.
  • Supplies of immovable property or investment gold, gold material, or semi-processed gold (in certain cases) that would otherwise be exempt, in relation to which the supplier exercised the option to tax (see Section 4.4 and Section 7.3).
  • Supplies of immovable property sold in enforcement proceedings.
  • CO2 emission allowances.
  • Certain supplies of goods and services stipulated by the Minister of Finance in cases of extreme urgency, to suppress frauds that can lead to significant financial losses.
  • Supplies of concrete steel and iron and steel and iron armatures.

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Croatia – “Call off stock”

Call-off stock, typically, refers to goods that a supplier has delivered to a warehouse or storage facility that a pre-identified customer can retrieve whenever needed. The warehouse is usually owned or controlled by the customer.


The foreign consignor is subject to a registration obligation when consignment stock is transported to Croatia. The transaction is treated as an import or intra-Community acquisition by the foreign suppliers of their own goods, followed by a domestic supply of a consignee.


Sales of call-off stock involving the transfer of goods into Croatia are subject to registration requirements for the same reason. Nonetheless, suppliers of call-off stock who are registered in EU Member States can avoid registration in Croatia if certain conditions are met, through a simplification scheme. Various simplification methods have been implemented before and as of January 1, 2020.


Simplifying the EU’s call-off stock regime


From January 1, 2020, the Croatian legislation incorporates one of the “Quick Fixes” outlined in Article 17a of the EU VAT Directive through Article 7a of the Croatian VAT Act. This change unifies call-off stock agreements across the EU.


If a supplier transports goods to a warehouse in another EU Member State with the intention of making a subsequent supply to a known purchaser, specific regulations apply. Under the simplification rule, the transfer of goods to the warehouse is not subject to taxation. However, the subsequent transfer of ownership of the goods to the recipient is a taxable event.


On January 1, 2020, call-off stock arrangements were standardized across EU member states. Croatia incorporated the guidelines for these arrangements into several articles under the Single Market Regulations. According to the simplification rule, the movement of goods in another EU Member State will not result in a taxable transaction, but the subsequent transfer of ownership of the goods will be subject to taxation. The supplier’s movement of the goods will be considered an intra-community supply, while the recipient’s acquisition of the goods will be deemed an intra-community acquisition.


The call-off stock rules will only apply to arrangements that meet the following conditions:
  • Goods must be supplied to another Member State by the supplier himself, or through a third party on their behalf, to supply the goods to a recipient who subsequently acquires ownership of the goods through an existing agreement between the parties involved.
  • The supplier must not be established or have a fixed establishment in the Member State where the goods are supplied.
  • The recipient of the goods who subsequently acquire the ownership of the said goods must be registered for VAT purposes in the Member State where the goods are supplied.
  • The supplier must obtain a record, called as ‘call-off stock register’, of the transfer of goods that will support the claim for call-off stock simplification. The supplier must also record the transfer in the EC Sales List (ESL) with proper identification of the recipient as well as the VAT-ID assigned to the recipient in the Member State where the goods are supplied.
  • The actual supply to the intended recipient from the consigned location must occur within 12 months upon arrival of said goods.

If all the conditions are complied with, there is a mandatory application of the call-off stock regime.

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Croatia – Import VAT

When goods are imported, the VAT liability arises at the time of importation. However, the same VAT result can be achieved when services are supplied from another EU Member State by using either the place of supply rules or the reverse charge mechanism, which shifts the VAT payment responsibility to the recipient.


According to Article 11 of the Croatian VAT Act, importing goods refers to bringing commodities into free circulation within the EU in accordance with customs legislation. If Croatia is the point of first entry into the EU, the transaction is subject to VAT under Article 32 of the VAT Act. The importer, customs debtor, or recipient designated under customs legislation is liable to pay the import VAT.


If a business has the original import tax document, it can recover the import tax it has already paid. If there are no taxable sales in Croatia, the company can claim a refund through its VAT return or the VAT refund procedure.


Exemption from Import VAT


There are goods imported in Croatia that are exempt from import VAT. These are goods that, when sold domestically, are also exempt from VAT. Additionally, certain types of goods, subject to certain conditions and restrictions, are exempted from import VAT under the Croatian VAT Act. Some of these are:

  • Goods that would be unconditionally exempt from VAT if supplied domestically in Croatia.
  • Imports of capital goods into Croatia by taxable individuals transferring their business activity to Croatia.
  • Certain substances imported for purposes of medical research.
  • Trademarks, patents, patterns, designs and their supporting documents, as well as applications for patents for inventions and the like, to be submitted to the competent bodies to deal with the protection of copyrights or the protection of industrial and commercial patent rights.
  • Governmental or humanitarian entities may import certain products and equipment for humanitarian or philanthropic purposes.
  • Reimportation of commodities that were previously temporarily exported.
  • Importation of gas, electricity, or heating or cooling energy through natural gas distribution systems or networks connected to such systems, or fed from a vessel delivering gas into a natural gas system or any upstream pipeline network.
  • Imports of products by the originating importer for immediate intra-Community supply.
  • Personal effects, such as things brought into the country in tourists’ carry-on bags.
  • Certain individuals relocating to Croatia brought personal property with them.


Deferral of the Croatian import VAT


Import VAT payment is generally required within the timeframes established by customs legislation. However, in some cases, VAT-registered importers, including non-resident taxable persons with a Croatian VAT ID number, may be eligible to use the postponed accounting system. This system allows them to record and deduct the import VAT on their VAT returns instead of paying it upfront.


The fundamental need for postponed accounting is that the importer has the power to deduct input VAT in its entirety, rather than adopting pro-rata percentage standards.


Postal parcels and low-value commodities up to 150 euros are not eligible for postponed accounting.



Last Updated: 29/12/2023


The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax

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