GOVERNMENT: Corporate Income Tax Ordinance

Boris Lalovac, ministar financijaLPJ Issue 163, 11 January 2016

The amendments reduce taxes on reinvested profits, which will not be recognised, if the taxpayer subsequently reduces the number of workers that have signed valid employment contracts, and before the expiration of two years. The interest rate on loans between related companies for 2016 is 5.14%.

To date, the discounted interest rate was 7%, as determined by Croatian National Bank (HNB). According to the new formula, the rate is determined as the arithmetic mean of the average interest rate on the outstanding balance of loans granted for a period longer than one year to non-financial companies, as published by the HNB in the current calendar year.

The ordinance introduces an additional PD-IPO Form, which requires data on the value of transactions between related parties. Goods and services will be required to be noticeably separated.

Proposed by: Ministry of Finance

Proposed by: The ordinance was published in the Official Gazette 137/15 and entered into force on 1 January 2016

See more