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David |
In line with the European Union Directive 2011/16/EU and appendix I and II to the EU Directive 2014/107/EU, the Croatian Ministry of Finance has enacted a bylaw on the Automatic Exchange of Information (AEOI) in Tax Matters, which was published in the Official Gazette No. 69/2016.
The bylaw clarifies in detail the provision of Article 177 of the Croatian General Tax Act wherein automatic exchange of information is prescribed to other EU member states on any resident of the particular EU member state which resides in Croatia without any prior requests or periods determined in advance.
AEOI applies to:
Income from employment;
Board and council member's fees;
Life insurance products which are not included in other legal exchange instruments and other savings measures of the EU;
Pensions;
Property ownership; and
Income made from property and property rights.
The tax authority exchanges relevant information with other EU member states starting retroactively from January 1 2014 and the exchange process is done at least once per year, six months before the deadline of the tax period for which the information has become available.
AEOI also affects earnings from interests from personal savings. However, in this case, banks and other financial institutions are obliged to report such earnings to the tax authority, which then forwards such information to the relevant EU member state. The same obligation for bank reporting also applies to any bank accounts newly opened in a bank in Croatia by a citizen of an EU member state. For existing accounts, bank reporting is obligatory if the threshold of $250,000 per account is surpassed in a given tax year.
David Jakovljevic (david.jakovljevic@eurofast.eu)
Eurofast Croatia
Website: www.eurofast.eu
