Tax Authority Gives Additional Explanations Regarding Tax Residence

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The authority said that tax payment is not determined based on citizenship or registered residence but based on tax residence as one’s centre of interests. Persons with an immediate family (spouse and/or children) have tax residence where their family lives and where the family uses what it needs for everyday life (place of work, physician, school, kindergarten, etc.)

For a person who is single, tax residence is determined on the basis of the place where that person has resided for a period of more than 183 days, the Tax Administration said.

As for Croatian nationals who have left Croatia with their immediate family or as singles before 2016 or whose immediate family lives outside Croatia, they are presumed to no longer be Croatian tax residents and are therefore not obliged to report their total income in line with the principle of worldwide income in Croatia. Even if they own a property, which they have inherited or bought in Croatia, and which they possibly rent and pay taxes in Croatia accordingly, that does not make them Croatian tax residents, the Tax Administration says.

Due to incorrect information that has been circulating in public, many Croatians who have lived with their families outside Croatia for years are now wondering if they need to report anything in Croatia, so the Tax Administration stresses that they are not obliged to report their income in Croatia.

Only persons who have changed tax residence in the period since 2016 by having emigrated and transferred their centre of interests outside of Croatia but who have not deregistered from the Croatian tax residence register, must do so by submitting the TI form and a certificate of the other country’s tax residence so that the change of tax residence could be determined retroactively, the Tax Administration says.

It also notes that the voluntary reporting of income from abroad is done by submitting an appropriate form and, if necessary, other forms available on the Tax Administration’s website.

In the process of determining a possible tax obligation, in line with the voluntary reporting of foreign income, a method will be applied that is more favourable for the taxpayer, the tax authority said, among other things.


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