Croatia offers companies endless opportunities for growth and expansion, with shipbuilding and tourism the most prominent industries. To get started in Croatia, you must have a registered accountant to manage your tax filings and report to the government. Croatia also has a PDV tax (similar to VAT in other countries) which is 25% added to the sale of items (10% on select tourist items). Accepting cash payments for your business increases your reporting liabilities to the government, including reporting cash transactions in real-time.
Labor and Payroll Considerations in Croatia:
- Minimum wage is £546 per month ($648 USD)
- Verbal employment contracts are considered to have an unlimited term
- Normal working hours are 40 per week, but can be as high as 60 with collective bargaining agreements
- Collective Bargaining Agreements are set at industry and company levels
- Income tax payments are via a Pay-As-You-Earn (PAYE) system
- Employers withhold income tax, social security, PDV from employee pay
- Employee pay stubs must include gross wages, deduction amounts, net wages, and other payments
- Foreign nationals who are not EEA nationals and do not have permanent residence in Croatia must apply for a work permit and an employment contract is required
- Croatia has set quotas for the number of foreign workers allowed
Annual financial reporting includes corporate income tax returns, balance sheets, profit and loss statements, foreign business activities (if any) and more. Deadlines have been extended due to the impact of the pandemic on many business functions, but it is important to stay ahead of the filing dates to ensure compliance.
To manage your payroll and compliance in Croatia, Blue Marble has easy-to-use cloud-based payroll software with customized reporting so you can view payroll in real time across all countries and currencies. Our hybrid service model provides a US-based team and in-country experts in Croatia to help when questions come up. Talk to us to help with business entity set up, accounting and tax filings, and payroll compliance. Simplify your operations and payroll in Croatia – get started today! Click here to learn more