VAT Registration in Croatia
To register for Croatian VAT, individuals must provide a completed registration form (“Form P-PDV”), along with a questionnaire on the allocation of the VAT ID, an application for a personal identification number (“OIB”), and other supporting documentation. The application should contain basic information about the applicant, evidence that the applicant is a taxable person in their country of residence, and a statement outlining their intended business activities and the purpose of obtaining a VAT ID.
If a taxable person or a non-resident with a fixed establishment in Croatia exceeds the set threshold they need to register for VAT.
Read below all about VAT registration in Croatia in our comprehensive guide.
Register for VAT in Croatia
Foreign individuals or companies who are not resident in Croatia but are providing taxable services in the country must notify the Tax Authority and apply for VAT registration prior to making their first supply in Croatia. The specific requirements may vary depending on whether the foreign person is established within or outside the EU.
Taxable persons include:
A “taxable person,” according to Article 6 of the Croatian VAT Act, is any legal or natural person who:
- Independently, engages in any economic activity, regardless of the purpose or effects of that activity.
- Natural and juridical persons that carry out economic activity.
- Non-commercial entities such as public bodies carrying out an economic activity of commercial value.
Mandatory registration
According to the VAT Act in Croatia, individuals or entities that are VAT-taxable residents of Croatia or have a fixed establishment in the country are required to register for VAT if their annual transactions exceed the registration threshold in the current or previous calendar year. This requirement also applies to taxpayers who receive reverse charge services in Croatia. The current registration threshold, as per Article 90 of the VAT Act, is 39,816.84 euros, which became effective on January 1, 2023, after Croatia adopted the euro as its official currency. Prior to this, the registration threshold was 300,000 kuna.
Selling in Croatia?
Register for VAT in Croatia
Voluntary Registration
Individuals or entities in Croatia who are considered “small taxable persons” – meaning their annual taxable transactions do not exceed the registration threshold – have the option to voluntarily register for VAT under Article 90 of the VAT Act. Voluntary registration allows these small taxable persons to reclaim input VAT. However, it is important to note that once they voluntarily register for VAT, they must remain registered for a minimum of three years.
If small taxable persons in Croatia supply new means of transport or receive supplies that are subject to reverse charge, they are required to register for VAT regardless of their annual turnover. On the other hand, non-Croatian individuals or entities are not allowed to register for VAT voluntarily, as they are required to register for VAT mandatorily if they participate in taxable transactions in Croatia.
Exemption from Registration
Article 77 of the Croatian VAT Act provides that the following persons are not required to register for Croatian VAT:
- Domestic legal or natural persons, if the value of their supply does not exceed registration thresholds and they are not conducting intra-Community transactions that necessitate Croatian VAT registration.
- Individuals who make an intra-Community supply of new modes of transportation regularly.
- Persons who only conduct VAT-exempt transactions and are not entitled to a deduction.
Individuals subject to taxation who engage in the regular or occasional international road transport of passengers through Croatia, regardless of whether they come from another EU Member State or a third country, are required to register for VAT in Croatia. They must obtain VAT identification numbers before providing passenger transport services within Croatia.
Voluntary registration
Businesses that are not obligated to pay VAT have the option to voluntarily register for it. This becomes crucial if they need a VAT ID for conducting transactions with other companies in EU Member States, like intra-community sales or acquisitions. In case these exempt businesses opt for VAT registration, they must notify the tax authorities about the motive behind their decision.
Groups and Divisional Registration
Under Croatian VAT legislation, it is not possible to register as a group or division for VAT purposes.
Registration, Generally
Individuals or entities that engage in international road transportation of passengers through Croatia, whether they are from other EU member states or third countries, are obligated to register for VAT in Croatia. This requirement applies to those who provide such transportation services. Before starting to offer passenger transportation services in Croatia, they must obtain a VAT identification number by making a request for registration.
VAT Representative
Businesses that are not established in Croatia may be required to appoint a Croatian tax representative to take responsibility for their VAT obligations. If VAT-registered businesses are established in other EU member states, they may either register for VAT in Croatia themselves or designate a local tax representative to manage their VAT affairs in the country. In contrast, businesses outside the EU that are registered for Croatian VAT are typically obligated to appoint a tax representative. The local tax representative is authorized by the business to receive documents on its behalf, submit VAT returns, and carry out all necessary duties to calculate and pay the business’s tax liability. The tax representative shares joint and several liability with the business for VAT payment. According to Article 126(4) of the VAT Act, the tax representative acts as a guarantor for the business.
Last Updated: 27/12/2023
Disclaimer
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
