When importing goods from a third country into the European Union, or releasing them for free circulation, an obligation arises to pay import duties. This includes import customs duty, VAT on import, and other applicable public charges depending on the type of goods.
The provisions of the VAT Act (“Narodne novine” No. 73/13 to 113/22 – hereinafter: VAT Act) allow for the application of so-called accounting VAT on import to ease liquidity for taxpayers and facilitate business operations.
According to Article 76, paragraph 8 of the VAT Act, VAT on import is considered paid if the VAT-registered taxpayer (who has the right to deduct input VAT in full) records it as an obligation in the VAT return, provided they opt for this method by correctly completing the customs declaration that releases the goods for free circulation.
Applying the accounting VAT method for import is optional and offered as an opportunity rather than an obligation.
Foreign taxpayers (from either the EU or third countries) who are registered for VAT in Croatia (with an assigned VAT identification number in Croatia) and meet the prescribed conditions can also qualify to use accounting VAT on import.
More information on this benefit and its conditions can be found in Guideline No. 8/23 on VAT payment at import based on VAT returns and in the leaflet on accounting VAT on import.