Croatia belongs to the attractive European jurisdictions whose potential is underestimated. The country has a steadily growing economy with significantly developed industrial sectors like mechanical engineering, pharmaceuticals, and tourism. Therefore, it can be interesting to open a company in Croatia (Zagreb or any other city) because of the access to many benefits.
Advantages of registering a business in Croatia
If you have set your sights on registering a company in Croatia, this option can be potentially advantageous due to the following advantages of the jurisdiction:
- steadily developing economy;
- the favorable location in the European region with free access to European markets;
- availability of free economic zones;
- openness to foreign investors;
- fast company registration procedure in Croatia;
- the possibility of obtaining a residence permit without any problems.
Business and legal presence forms
It is possible to open a business in Croatia or otherwise establish a business presence in one of several forms:
- A Limited Liability Company is a business that can be founded even by one participant whose liability does not exceed the investment amount. The minimum founding capital is 20,000 Croatian kuna. The company has simple record-keeping and filing requirements. Suitable for small and medium businesses.
- A joint-stock company is suitable for large businesses that plan to attract investments in large volumes. One shareholder can find a company whose liability, under all conditions, does not exceed the investment amount. The minimum amount of share capital is 200,000 Croatian kuna. JSC has stricter requirements for accounting and reporting.
- A branch is a form of doing business by a foreign company that can carry out the same activities in Croatia as it does in its country of registration.
- A representative office is an option where a foreign company has no right to conduct business in Croatia. Still, it can explore local markets to invest large sums in this country in the future.
Company registration procedure in Croatia
You can register a company in Croatia by going through the following approximate steps:
- Selection of activities and commercial name for the future Croatian company. Drawing up a business plan.
- Search and decoration of management and office for the future company.
- Collecting information about the founders, beneficiaries, and management of the future Croatian company.
- Drawing up and executing founding and incorporation documents. Documents not in Croatian should be translated into Croatian and managed adequately.
- Opening a bank account to pay the share capital (1/4 minimum).
- Paying the registration fee and submitting the documents to the registrar for review.
- Registration to pay taxes and mandatory social contributions.
- Registration of additional licenses and permits.
Legislation and regulatory environment
Croatian law is generally open to foreign citizens. Non-residents can register companies, buy real estate, and have available accounts with local citizens. Prifinance lawyers are ready to provide individual consultations after receiving input from you.
Croatia’s tax system
The option of company registration in Croatia should be considered along with the following parameters of the local tax system:
- Corporate tax – (1) 18% – for companies whose revenues exceed Croatian kuna 7.5 million, (2) 10% – for companies whose revenues do not exceed Croatian kuna 7.5 million
- Income tax – 0-18%
- VAT – 25%
- (1) corporate tax: (a) dividends – 10% (b) interest – 15% (c) royalties – 15% (2) individual tax: (a) dividends – 10% (b) interest – 10% (c) royalties – 20%
- Capital Gains Tax – (1) corporate – see corporate tax (2) individual – 0-18%
How Prifinance lawyers can help
- evaluate the option in terms of compliance with your business plans, as well as taking into account the background of your business case;
- develop an individual plan for company registration in Croatia;
- collect and properly execute all the necessary data for registration of the future company in Croatia;
- draw up and manage all essential documents, including incorporation and registration documents for the new company;
- undertake the actual completion of the new business registration procedure in Croatia;
- open bank accounts or EMI for the future company;
- provide legal support in the process of further operation of your Croatian company.