Profit tax (corporate tax or corporation income tax) is a relatively young form of taxation that achieved its full momentum only in the 20th century and today it is present in almost all developed capitalist countries of the world. It is a tax form that taxes the result of performing an economic activity.
Who is a TAX PAYER?
1. Trading company and other legal and natural person – (resident of the Republic of Croatia) which performs economic activity independently and permanently for the purpose of achieving profit, income, or other economic benefits
2. Domestic business unit of a foreign entrepreneur (non-resident)
3. Companies going through bankruptcy/liquidation process
4. Institutions, associations, etc. – if they perform economic activity (only for that part)
5. A natural person who earns taxable income (craft occupations):
a) AT OWN REQUEST – upon declaration that they will pay profit tax instead of income tax
b) BY FORCE OF LAW – if in the previous tax period, they received income higher than 7.500.000 kn/995.421,06 € (excluded of VAT)
TAX PERIOD
• Calendar year (01.01.-31.12.)
• Shorter – newly established companies (date of establishment – 31.12.)
• Different business from the calendar year – at the request / with the approval of the tax authorities – usually foreign entrepreneurs
TAX RATE
For enterpreneuers with income in the tax period:
• up to 7.500.000 kn/995.421,06 € – 10%
• from 7.500.000 kn/995.421,06 € – 18%
| TAX BASIS | |
| · • Profit determined in accordance with accounting regulations as the difference between income and expenses, before the calculation of profit tax, increased/decreased in accordance with the Law on Profit Tax
· • Profit from liquidation, sale, change of legal form and division |
|
| RESIDENT | Profit realized in the country and abroad |
| NON-RESIDENT | Profit realized in Republic of Croatia |
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