Croatian Investor Visas Explored

Croatia Residency by Investment

Discover the benefits of investing in Croatia

We are experts in the niche area of immigration by investment to Croatia. Our team strive to provide the most suitable investment opportunities to meet our clients needs to ensure they can secure residency under the current relevant Croatian and EU immigration laws.

Migration Investment programmes are now the fastest growing area of immigration law globally, as more people appreciate how residency and a second Citizenship is not just desirable but a vital part of an effective global freedom, privacy and security strategy.

To establish yourself or your business in Croatia requires securing relationships with key stakeholders including government officials, bankers and corporate professionals. You will need experienced consultants to build a network of contacts and help you to become established in your new environment.

The specialised services of Haskew Law are a resource and complement to major law and consulting firms. We can help other firms and their clients with the unique and specific details required by the business relocation process and related tax planning.

Some of the many advantages of Croatia include:

  • Some of the most beautiful coastline in Europe, with unspoiled nature, rich culture, and a mild Mediterranean climate;
  • Full Member of the European Union;
  • New investment tax incentives with the possibility of 0% profit tax (Investments Incentives Law).

Croatia is a relatively small country, yet enjoys a spectacular 6,278 km coastline on the Adriatic, with more than 1,100 islands, of which only 66 are inhabited. This coast is considered to be among the most beautiful in Europe, with innumerable bays, inlets, coves and beaches. On the Adriatic coast alone, there are six historic places which are listed as World Heritage sites by UNESCO, and visitors flock to destinations including Pula, Trogir, Split, Hvar, Korcula, and Dubrovnik.

Croatia enjoys three different climates: The coast has a pleasant Mediterranean climate with a high number of days of sunshine per year. Summers are hot and dry and winters are mild and wet. Most islands receive more than 2,600 hours of sun a year. Temperatures drop slightly as you move inland, where the climate is continental and moderate.

Croatia is divided between the Latin-influenced coast and an interior which is more Central European. The official language is Croatian, although English is spoken widely, particularly in larger cities. The capital is Zagreb with almost 800,000 inhabitants.

Croatia is established as a parliamentary democracy and guarantees the right and inviolability of private property. Also, rights acquired through capital investment are constitutionally guaranteed. Free transfer and repatriation of profits and capital are guaranteed to foreign investors. Asset forfeiture is possible only following a final court decision.

Croatia became a full member of the United Nations in 1992 and became a 28th full member of the European Union in 2013, which opened up new opportunities for entrepreneurs in areas including trade, investment, and financial flows.

Since 1998, Croatia has seen a steady growth of tourist visits and overnight stays. Croatia had an increase of 35% in tourist arrivals between 2010-2015. 14.3 million tourists visited Croatia in 2015, and the number is expected to continue to increase.

Real Estate in Croatia

The Croatian real estate market is fairly well developed. Land and house prices are still very favourable, particularly on the islands where there are beautiful stone houses built in the traditional style. Also in the beautiful historic towns such as Dubrovnik, Hvar, Zadar or Korcula, there are excellent opportunities to acquire prime location real estate at reasonable prices.

Although the purchase of real estate is straightforward, it is nevertheless advisable to make use of professional assistance. After the estate agent or attorney prepares the contract, the parties sign the contract and the notary certifies the signatures. The notary's fees are very low since the notary only certifies the signatures. Following that, the estate agent or attorney requests the registration of the property on behalf of the buyer. EU citizens can freely purchase property in Croatia, except agricultural land and protected areas. Non-EU citizens can purchase residential and commercial property in Croatia providing that they get an approval by the Ministry of Justice.

The approval is issued if there is reciprocity, i.e. if Croatian persons can purchase real estate in the country of the purchaser. While such an approval can take up to 12 months, it can easily be avoided if the property is bought by a domestic company, which can be entirely owned and controlled by a foreign person. In that way, the transfer tax on real estate of 5% can also be avoided during each subsequent sale of the property.

To acquire real estate or to establish residence in Croatia will require securing relationships with key partners such as government officials, bankers and corporate professionals. You need experienced consultants to build a network of contacts and help you to become established in your new environment.

Company formation in Croatia

 The most common type of company in Croatia are the d.o.o. - similar to an English limited company. Such a company has limited liability up to the minimal amount of its share capital of 20,000 HRK (around EUR 2,700). It must have at least one member of the company - natural person or legal entity - and at least one director.

Name of the company

The company business name can be in any official language of an EU member state, which is helpful for those who do not want to use a local language.

Business activities

Most business activities are already included in the Articles of Association of the company and there is no need to register them additionally as it is the case in some other European countries (Czech Republic, Germany, etc.).  Certain activities require an authorised representative, insurance coverage, or a special state license.

Company Founder

The founder of a company can be any legal entity or natural person. No special requirements exist. A valid passport and identity card are required by Companies register. In case that the founder of the company is a legal entity it is necessary to provide a certificate of good standing (extract from the Companies register) of the company founder.

Directors

Company directors can be any natural person (no legal entity can be director of Croatian company) competent for legal acts. Every citizen of EU can be a director of the company. Special rules apply if the director is a non-EU citizen.

The seat

This is the registered address of the company within Croatia, which is needed for registration of the company in Companies register. A virtual office can be provided practically anywhere in Croatia.

Accounting

The use of an accountant is mandatory for every company regardless of the activity or size.  Many say it is important to use a local accountant, however, Croatian accountancy rules are compliant with EU standards, so any experienced ACCA or CIMA qualified accountant using Sage would be able to produce accounts.

Company Formation Procedure

After checking availability for a company name and obtaining Personal ID number, an application form for registration into the Company register is notarized, together with Memorandum of Association and director’s statement of acceptance of the appointment. A bank deposit account is opened and minimum base capital should be deposited.

Transactions can be made electronically or in cash, however, base capital remains blocked during the company formation procedure.

After the company is registered, company Seal is made and the company is registered on the National Statistics Office, after which a Business account is open.

It takes one or two weeks to complete the entire procedure of establishing your own Croatian company.

VAT Registration

While in most EU countries VAT registration is a long and complicated process, in Croatia you can register a company for VAT within a few days.

Seat, Virtual Office

The seat of the Croatian company has to be registered at the national Companies register.

For those who have yet to secure premises, a virtual office can cut your cost to a minimum, assuring that you are only paying services you really need for your business.

Accounting Services

For our clients, we provide a full range of cost-effective accounting services.

Bank Account

We work closely with Primorska Banka, part of CIM Banque leading Swiss Private Bank based in Geneva, Lugano and Wollerau. The Bank is mainly focused on corporate clients, offering exclusivity and individual financial solutions for each company.

Laws and Regulation Checks

On your request, we will check if your business activity is subjected to any special regulations and we will make sure that once you open a company you can run your business smoothly.

Real Estate

Do you want to buy property in Croatia?

If you are an EU citizen:

  • As an EU citizen, you are eligible to buy property in Croatia under the same conditions as Croatian citizens. You cannot buy agricultural land, real estate within parkland, or protected estates (e.g. historical buildings, castles, etc.);
  • After the property is bought you can use it, rent it, sell it, pawn it, give it, renovate, build and do anything as would any Croatian owner;
  • Before you sign a Purchase Contract, EU citizens should obtain a Personal ID number from the Croatian Tax Office for eventual tax payments etc.

If you are not an EU citizen:

  • Non-EU citizens can buy property in Croatia based on a Reciprocity agreement between two countries. That means that if Croatian citizen is allowed to buy real estate in your home country, you can also buy real estate in Croatia.
  • To buy property in Croatia you need to have the consent of the Ministry of Justice. Only citizens of countries with Reciprocity agreement with Croatia can obtain that consent.
  • If your home country doesn’t have signed a Reciprocity agreement with Croatia, you can incorporate a company in Croatia and then buy using the company name, which avoids the need for the consent of the Ministry of Justice.
  • If you are a non-EU citizen and you want to rent out your property, then it is advisable to incorporate a company in Croatia, and similarly rent a via the company.

Purchase of land and real estate is exempt from the VAT, but is subject to a 5% transfer tax, paid by a buyer.

Business Visas

Do you want to own a company and work and live in Croatia?

For citizens of non-EU and non-EEA countries:

  • You will need a visa to enter Croatia, and should apply for a Travel visa to allow you to come to Croatia to start the business formation process;
  • In order to own a company in Croatia and be employed as its Director, a company must have "base capital" of 200,000 HRK (around EUR 26,500) and at least 3 Croatian citizens should be employed.
  • If you do not own a company but you will be the Director, a company must have base capital of 101,000 HRK (around EUR 13,300) and at least 3 Croatian citizens should be employed.
  • After a company is registered, and 3 Croatian citizens are employed we can submit on your behalf through POA application for Temporary Residence. The waiting period for approval is around 45 days.
  • Director’s salary should be at least as high as an average salary in Croatia for the previous year.

If you need assistance with business visa application process contact us and we will lead you the way.

Taxation in Croatia

Corporate tax

Corporate income tax rate is 20%. The corporate income tax base is the accounting profit adjusted for deductions and disallowed items. Expenditures are considered to be expenditures if they are related to the taxpayer's business activity.

Value Added tax (PDV)

Being an EU member state Croatia falls under the EU VAT regime meaning that it has adopted EU VAT Directives into their own legislation.

  • Standard rate VAT is 25 %.
  • Reduced rate VAT of 13% applies to all tourist accommodation services and catering services.
  • Some services are VAT exempt, e.g. insurance and financial services, medical services, education, welfare etc.
  • VAT registration is compulsory when the annual turnover exceeds HRK 230,000 (around EUR 31,000).

Croatia Real Estate Transfer Tax

Purchase of land and real estate which is exempt from VAT are subject to 5% transfer tax.

Croatia has a high tax regime, but this shouldn’t affect you unless much of your income derives from sources within the country–or you become a tax resident. Tax residents are generally taxed on their worldwide income.

Based on physical presence, you are a tax resident in Croatia if you stay for at least 183 days under circumstances that indicate your visit is not temporary. The 183-day visit may overlap calendar years.

Based on maintaining a home in Croatia, you are a tax resident if you have a residence there at your exclusive and continuous disposal for at least 183 days under circumstances that indicate you intend to keep and use that accommodation. Again, this period may overlap calendar years. Your length of stay is not relevant, nor does it matter if the accommodation is owned or rented.

This may seem surprising, but if you do not receive a salary, consultancy fees, or a similar income in Croatia, then the tax situation is much more favourable, particularly for retirees.

Croatia has no wealth tax, and the following income is tax-free:

• Pensions received from abroad

• Interest payments on loans, investments, securities, deposits with financial institutions, and similar incomes

• Capital gains from trading securities and other financial assets

• Capital gains from real estate if you occupied the property, held it more than three years, or sold it to your spouse or an immediate family member

• Inheritance and gifts are exempt from taxation in the first line of succession. (In other cases, there is a flat rate of 5%.)

Foreigners are subject to tax on the following forms of Croatian income:

• Income from employment that is received in Croatia or from work in Croatia

• Income from a business in Croatia

• Income from real estate

• Income from one’s own or chartered marine ships/aircraft used for dispatching goods or people from Croatian ports/airports

• Income from independent personal activities (deliveries of goods or rendering of services) that are carried out in Croatia or abroad, and are used for the performance of an activity in Croatia

• Income from capital or insurance that originates from within Croatia.

Recent income tax rates:

Accurate as of publication, but please check as rates may change without notice:

• Up to 36,000 kuna ($6,120): 15%

• Over 36,000 kuna ($6,120) and up to 81,000 kuna ($13,770): 25%

• Over 81,000 kuna ($13,770) and up to 252,000 kuna ($42,840): 35%

• Over 252,000 kuna ($42,840): 45%.

Corporate income tax is typically 20%.

The regional municipal income surtax

Croatia’s financial regulations also allow for municipalities to charge an income surtax. This will not affect you unless you are tax-domiciled in Croatia.

Equivalent to a poll tax, the amount payable is taken on income tax thresholds and is levied at varying rates throughout the country:

• A commune can charge at a rate of up to 10%

• Cities with a population of below 30,000 can charge at rates of up to 12%

• Cities with a population over 30,000 can charge at rates of up to 15%

• The city of Zagreb, the capital, charges as much as 30%

Permanent Residence in Croatia by Investment

Applicants can obtain permanent residence in Croatia by securing:

  1. a Temporary Stay Permit, which is required of all individuals seeking to stay in the country for more than three months;
  2. a Permanent Stay Permit, for which an applicant becomes eligible after submitting proof of an uninterrupted stay in Croatia for a period of not less than five years.

The procedure for obtaining permanent residence in Croatia differs depending on whether the applicant is an EEA national or a non-EEA national.

Permanent Residence in Croatia for EEA Nationals

Eligibility Requirements:

While there is no minimum investment requirement for obtaining permanent residence in Croatia, an applicant who is an EEA national must fulfil the following conditions to obtain a temporary stay:

  • The applicant must be employed or self-employed.
  • The applicant must have sufficient funds to support his or her family without requiring social care assistance during their stay in the Republic of Croatia.
  • The applicant and his/her family must have adequate health insurance.

Fulfilling these conditions and reporting one’s temporary stay in Croatia to a competent police authority having jurisdiction over the applicant’s place of stay will entitle him or her to a certificate of reporting a temporary stay that is valid for a period of up to five years.

The applicant can seek permanent residence in Croatia after five years of uninterrupted residence in the country. A single absence of fewer than six months and multiple absences of less than ten months over the five year period will not be treated as an interruption in the residence.

After five years, the applicant can seek issue of permanent stay permit from police authorities having jurisdiction over his or her place of stay in Croatia. The permanent residence permit is issued with a validity of ten years.

Documents Requirements:

The applicant must submit the following documents:

  1. Valid proof of identity
  2. Valid travel documents
  3. Proof of employment.
  4. Proof of educational qualifications.
  5. Proof of having adequate funds for sustenance in Croatia.
  6. Proof of adequate health insurance for the entire family.

Permanent Residence in Croatia  for Non-EEA Nationals

Like EEA nationals, non-EEA nationals are not subject to any minimum investment requirements when seeking permanent residence in Croatia.

The procedure for becoming a permanent resident in Croatia involves two steps:

  1. Obtaining a temporary stay permit and a stay and work permit outside the annual quota,
  2. Obtaining permanent residence permit after five years of legal and uninterrupted residence in Croatia.

Temporary Stay Permit

A temporary stay permit can be obtained by submitting the following documents:

  1. A valid travel document.
  2. Proof of sufficient funds to support self and family during the stay in Croatia.
  3. Proof of having adequate health insurance.
  4. Purpose of the temporary stay i.e. proof of the stay and work permit outside the annual quota. This permit can be obtained by submitting the following documents:
    1. Proof of educational qualifications.
    2. Proof of ownership of 51% stake in a company that is executing strategic investment projects in Croatia and executes activities and projects involving expert and technical assistance from other countries or international organizations.
  5. Proof of good character of the applicant indicating that his or her presence is not a threat to safety, national security, or public health.

Fulfilling these conditions will result in the issue of a temporary permit with a validity of one year. The permit must be repeatedly renewed for a period of five years.

Permanent Stay Permit

The non-EEA national can seek permanent residence after five years of uninterrupted residence in the country. The applicant should not be absent from the country for more than six months in a single trip and for not more than ten months over the five year period. The applicant must have a valid temporary stay permit when applying for permanent residence.

Documents Requirements

The applicant must submit the following documents with the application for a permanent stay permit:

  1. Valid travel documents.
  2. Proof of having adequate funds to support self and family in Croatia.
  3. Proof of adequate health insurance.
  4. Proof of familiarity with the culture of the country and the setup of the Croatian society. This shall be determined on the basis of the questionnaire that is a part of the permanent application form.
  5. Proof of knowledge of the Croatian language and Latin script. This may be obtained by taking tests conducted by educational institutions providing adult education in Croatia. This test is mandatory only if the applicant did not fill the above-mentioned questionnaire on his or her own. This test need not be taken by a retired applicant who is aged over 65 years.
  6. Proof of good character

Interesting Facts about Croatia

Did you know...?

  • That the Dalmatian dog from the film "101 Dalmatians" was named after Dalmatia, in which most of the Croatian Adriatic is located
  • That the first public theatre in Europe was opened in 1612 on the island of Hvar, in the town which "Conde Nast Traveler Magazine" chose at fifth place on its Top Ten list of best island towns in the world
  • That by the end of the third century AD, the Roman emperor Diocletian decided to construct his palace in the place where the city of Split is located today. The Palace of Diocletian is one of the best known integral architectural and cultural constructions in the world, which, due to its preservation and beauty, UNESCO entered in its registry of World Cultural Heritage in 1979
  • The small town is Trogir, 30 km away from Split, founded in the 3rd century BC, there is one of the best preserved Romanesque-Gothic complexes in the world. Trogir is an excellent example of a medieval town built on and conforming with the layout of a Hellenistic and Roman city and it is therefore also on the World Cultural Heritage list of UNESCO
  • That, before Newton's discovery, the town of Dubrovnik, which has been on the World Cultural Heritage list of UNESCO since 1979, owned a telescope which was constructed by Marin Getaldic (1568-1626), the greatest Croatian scientist of that time
  • That the necktie has its origin in Croatia (in Croatian: Kravata, English: Cravat, French: Cravate, German: Krawatte, Italian: Cravatta, Spanish: Corvatta) and that the word "cravat" came from the word "Croat" (Hrvat in Croatian); so called because worn by Croats in the French army during the Thirty Years' War. In their own way, with the cravat, the Croats have started conquering the world from the coasts of the Adriatic Sea from the 17th century. The consequences of that conquering are today felt around the necks by 600 million businessmen worldwide
  • That Marco Polo (1254-1324), an adventurer, merchant and one of the best-known world travellers, whose book "The Travels of Marco Polo" is the first tourist book in the world, comes from Korcula on Korcula island in Croatia
  • In 1458 Benko Kotruljevic from Dubrovnik wrote one of the first books on world economic literature, "On Trading and the Perfect Merchant", and that he was the first to establish the basis of modern double-entry book-keeping
  • That Shakespeare's Twelfth Night was staged in Dalmatia
  • That the writer Vladimir Nabokov always spent his summers in Opatija as a boy
  • That Agatha Christie spent her second honeymoon in Dubrovnik and Split
  • That James Joyce was a teacher of English in Pula from 1904 and 1905, in the town that has existed for three millennia with one of the best preserved Roman amphitheatres worldwide
  • That the Duke of Windsor and Wallis Simpson spent their vacations in Dalmatia
  • That Luka's Pit ("Lukina Jama"), the 10th by depth in the world (1,392 m), is located in Croatia on Velebit Mountain
  • That the founder of San Marino, a small independent republic in the northeast of Italy, was the sculptor Marin from the village Lopar from the island of Rab
  • That the ball-point pen was invented by a Croat, Eduard (Slavoljub) Penkala (1871-1922), that it bears his name and is in daily use
  • That the names of two Croats are on the map of the Moon - names of scientists J. R. Boskovic and A. Mohorovicic
  • That two winners of the Nobel Prize in chemistry came from Croatia - Lavoslav Ruzicka (1939) and Vladimir Prelog (1975)
  • That Nikola Tesla (1856-1943), the father of alternating current electricity and technology of wireless communications, after which the unit for magnetic induction is named, was born in Croatia, and that he refused to receive the Nobel prize he had to share with T. A. Edison
  • That Anthony Maglica, the owner of the well-known company Mag-Lite, comes from Zlarin island from Dalmatia. Mag-Lite flashlights are among the ten most famous American export products, used by astronauts and deep sea explorers, amongst others.

Booking a Consultation

Complete our online enquiry form and one of our senior managers will arrange a confidential consultation to discuss your requirements and potential options.

At Haskew Law, our team are highly acclaimed as ready to manage even the most complex of cases. Our thesis, however, is to keep things as simple as possible. We believe it is important our clients are comfortable and remain in control of their international plans throughout the process. We endeavour to protect our clients best interests while delivering outstanding results.

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Invest in Croatia
Croatia investor visas

Name: Residency in Croatia For Investors

Description: Croatia is relatively new to the world of international investments. They have learned quickly and now attract a great deal of interest and wealth from overseas. In return they offer permanent residency for those who what to be closer to their investments in a wonderful european country.

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