Renting of foreign citizens' own real estate in the Republic of Croatia for tourist purposes

Renting of foreign citizens' own real estate in the Republic of Croatia for tourist purposes

Foreign citizens, citizens of the EU, who own real estate in the Republic of Croatia have the right to obtain a permit to provide solutions for the provision of household accommodation services.

A natural person-citizen who is a citizen of the Republic of Croatia and citizens of the European Union, the European Economic Area and Switzerland may provide services for the provision of catering services in a household under the condition of business establishment in the Republic of Croatia.

In order to obtain the described approval, it is necessary to attach:

-proof of real estate ownership

- proof of the usability of the building (use permit, decision on the completed condition, proof that the building was built before 1968)

- general and special conditions for the type and category of object.

The described real estate can be rented as a natural person or through a company owned by the real estate owner or a third party.

From a tax and legal point of view, it is more advantageous for the owner of the property to rent the property as a natural person, considering that the realized income of up to EUR 40,000.00 is exempt from income tax and is exclusively taxed at a flat rate.

In case of provision of household accommodation services through a company, the tax burden is more significant, the company pays profit tax in accordance with the provisions of the Law on Profit Tax.