During the last two weeks Croatian government released several measures in order to help Entrepreneurs to overcome the crisis caused by unpredictable Corona Virus lockdown.
One of the measures in possibility of payment delay without interest rate or penalties of certain tax payments under certain conditions.
Scope of the support measure
Following tax liabilities can be deferred
• income tax
• profit tax
• VAT (limited)* see the explanation below
• other taxes (eg real estate tax, entertainment gaming tax, etc.)
OTHER PUBLIC GIVINGS:
• concession fees
• fines for tax offenses
• all charges whose determination and / or collection and / or supervision under special regulations is the responsibility of the tax authority
no delay in payment of customs duties and excise duties can be claimed
Tax liabilities that may be delayed
• All tax liabilities due within 3 months, starting from March 20th, 2020/ for the next three months (until 20/06/2020)
• Payment delay of 3 months
In case that special circumstance would last longer than 3 months, it is possible to apply for longer delay (totally 6 months), but with new written application and description of all circumstances.
Which companies are entitled for the measure/ possibility of postponing tax obligations ?
All companies not able to pay timely their tax obligations, not having debt towards tax office higher than 200,00 HRK on the date of application for postponement.
Qualifications for inability for payment are:
- decrease of income 20% or higher in the previous month comparing to the same month in 2019
- predicted income in the next three months will be most likely 20% or more lower than the same period in the previous year
Delay in payment of VAT liability
Entrepreneurs who determine the tax base according to the deliveries made and who did not realize the value of deliveries of goods and services in the amount of more than HRK 7,500,000 (excluding VAT) in the previous year
with a 20% decrease in revenue, the entrepreneur must prove that the due obligation arises from the issued invoices that have not been collected and / or other indicators that affect its liquidity (the rulebook does not define other indicators)
deferral possible only from the March 2020 liability (due on 30/04/2020) no deferral of the VAT liability for February 2020 due on 31/03/2020 can be requested. years
Possibility of repayment of deferred tax liabilities
After expiration of 3 or 6 months period it is possible to send new application for repayment in the monthly instalments (longest possible period is 24 months)
- application deadline: five days from the due date of the tax payment commitment
• the request is submitted for the following situations:
1. installment repayment only for the deferred liability, whereby the approval of the application excludes the possibility of granting a installment for deferred tax liabilities that are due later
2. installment repayment for all deferred tax liabilities, due and due at the time of filing the claim, in which case the deferred tax liabilities are due and the installment payment is approved for their payment, instead of further deferral
• in case of non-compliance with the payment deadlines, the installment payment authorization is revoked
For our Nautical Consulting clients- In case you would like to apply for deferred tax payment- contact us and we will do application on your behalf. This service is free of charge for our clients!