Croatia: Changes to VAT rules

In August 2011, changes in the Croatian VAT legislation have been made. The changes mainly relate to the introduction of electronic invoicing, the VAT registration of foreign enterprises and the taxation of interest related to the delivery of goods and services.

Introduction of electronic invoicing.
Invoices may now be issued in print or electronic format. Enterprises are not required to issue invoices for VAT exempt services (financial services) except upon request by the service recipient. The invoice recipient must confirm, electronically or in printed format, its consent to receive electronic invoices before it receives the first electronic invoice. Electronic invoices must be saved in their original electronic format in which they were submitted.

Registration of foreign enterprises.
VAT registration of foreign enterprises (done by the fiscal representative) can be supported not only by tax registration certificates but also by any other official registration certificate issued by an official authority of the enterprise’s country of residence.

Taxation of interest related to delivery of goods and services.
Taxpayers that occasionally grant loans related to deliveries of goods and services may treat a loan sourced from their own financial assets as a VAT exempt service, if the lending service is reported separately from the value of the related goods and services.

Adrian Hammer

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