AMENDMENT TO GOVERNMENT MEASURES DURING THE PERIOD OF SPECIAL CIRCUMSTANCES

Below an overview of amended regulations governing taxes during the period of special circumstances:

1. Application of postponement of due VAT payables:

• All VAT payers who determine tax base according to value of performed deliveries are entitled to postpone VAT payment
• Only postponements in the amount of tax due on unpaid fees are approved
• Any liability that is due before the expiration of three months after entry into force of the amendment to the General Tax Act is considered to be a due liability

Conditions for entitlement of VAT postponement:

• Decrease of revenue/earnings in the month preceding the month in which application for tax payment measures is filed of at least 20% as compared to the same month of previous year or 
• if it seems likely that revenue/earnings in the following period of three months from the month of application will decrease at least 20% as compared to the same period in the previous year.

Remark: Written and reasoned application is submitted at the Tax Office via the system ePorezna.

2. VAT on import of goods

• Based on the Decision of the Commission (EU) 2020/491 from 03.04.2020, duty and VAT exemption shall be applied to the import of goods required to combat the effects of the pandemic, whereby conditions and terms are prescribed in the aforementioned Decision
• for imports carried out up to 20.06.2020 VAT on imports is considered to be paid if it was disclosed as liability in the VAT return

3. Exemption of settlement of tax liabilities

• Exemption refers to tax liabilities and other public fees that are due between 01.04. to 20.06.2020
• Exemption shall not apply to: VAT, duties and excise duties, mandatory pension fund contributions based on individual capitalised savings, tax and surtax determined on final income (income from capital, income from property and property rights, income from self-employment paid in flat sum), gambling fees and taxes and liabilities arising from previously concluded agreements and rescheduled liabilities from pre-bankruptcy and bankruptcy settlements   

Conditions for exemptions of settlement of tax liabilities

• Decrease of revenue/earnings of at least 50% in the period 20.3. to 20.6.2020 as compared to the same period last year:
• For taxpayers who, in the previous year, exercised deliveries of goods and services exceeding HRK 7,500,000.00 excluding VAT - partial exemption
• For taxpayers who, in the previous year, exercised deliveries of goods and services less than HRK 7.500.000,00 excluding VAT – full exemption
• Tax payers who are already entitled to defer tax liabilities will be entitled to partial or full exemption without a new application. The right to full or partial exemption will be determined by the tax office based on already available data and data delivered by the tax payer.
• Exceptionally, taxpayers who have not applied for a postponement of payment of tax liabilities but experience disrupted business operations by more than 50%, are entitled to exercise exemption of tax obligations up to 20.06.2020, what will be decided by the Tax Office in a special procedure.

4. Postponement of submittal deadline of CIT return for 2019 and submittal of financial statements

• Under special circumstances, the CIT return is submitted at the Tax Office up to 30 June of the current period at the latest 
• Exceptionally, for the duration of special circumstances, the following deadlines apply:
  • FINA up to 30 June 2020 (for statistic and other purposes)
  • FINA within 8 months from the last day of the business year (for publication purposes)
  • FINA within 10 months from the last day of the business year (consolidated financial statements (if obligation for the preparation of consolidated financial statements exists))