SME Scheme – General features
Exemption
It is possible to opt for the SME scheme in Croatia.
Transactions excluded from the SME scheme
The following transactions are excluded from the SME scheme:
- Exempt cross-border supplies of new means of transport made from one Member State to another.
- Supplies for which small taxable persons must pay VAT under reverse charge mechanism
National annual threshold
The annual threshold in Croatia is 60.000 Euro.
The information on the national annual threshold is available on TEDB.
Domestic SME scheme
Simplified VAT obligations
A small enterprise established in Croatia who applies the SME scheme in Croatia only (domestic SME scheme) is released from the following VAT obligations:
- to VAT register, except when they carry out certain transactions with other Member States
- to submit VAT returns
Small enterprises applying the domestic SME scheme only must fulfil the following VAT obligations:
- to issue invoices
- to keep accounts
- to submit administrative statements
Cross-border SME scheme
The cross-border SME scheme applies in the following situation(s):
- The small enterprise applies the SME scheme in other Member States than the Member State of establishment, or;
- The small enterprise applies the SME scheme both in the Member State of establishment and in other Member State(s).
Simplified VAT obligations
The VAT registration in each Member State where the small enterprise applies the SME scheme is replaced by a single prior notification to be submitted in the Member State of establishment.
The periodical VAT returns are replaced by a single quarterly report for all Member States to be submitted in the Member State of establishment.
Currency
The values of supplies of goods and services to indicate in the prior notification, in the update to a prior notification and in the quarterly reports must be in EUR.
Way of submission
The prior notification, the update to a prior notification and the quarterly reports should be submitted by electronic means on this page.
Additional simplified VAT obligations
Exempt small enterprises applying the cross-border SME scheme in Croatia are released from the following VAT obligations:
- to issue full invoices (SME can use simplified invoicing)
Loss of simplified VAT obligations
Non-compliant small enterprises may be required:
- to VAT register
- to submit periodical VAT returns
Transitional period
Croatia does not apply any transitional period in case the national annual threshold is exceeded during the current calendar year.
The transitional period applicable can be found in the TEDB database.
Quarantine
Quarantine period in case of exclusion from the SME scheme
In Croatia, in case of exclusion from the SME scheme, the small enterprise excluded from the SME scheme cannot benefit from this exemption during a quarantine period of 1 year.
Quarantine period in case of voluntary departure from the SME scheme
Small enterprises who decide to voluntarily leave the SME scheme in Croatia are not able to benefit from that exemption during a quarantine period of current calendar year and the following calendar year.
You can consult the quarantine period applicable in Croatia on TEDB database.
Appeals
Domestic SME scheme
Appeals should be addressed to your Member State of establishment (MSEST).
Cross-border SME scheme
Member State of establishment (MSEST)
Appeals related to the following topics should be addressed to MSEST:
- Union annual turnover
- Prior notification, correction and update to a prior notification
- Quarterly reports and correction of a quarterly report
- Exclusion for exceeding the Union annual turnover
Member State of exemption (MSEXE)
Appeals related to the following topics should be addressed to MSEXE:
- National annual turnover
- Denial to access the cross-border SME scheme in MSEXE
- Loss of simplified VAT obligations in respect of MSEXE
- Exclusion for exceeding the national annual threshold/sectoral threshold in MSEXE