Obrt is the sole proprietorship in Croatia that can be established under the rules of the Handicraft Act and the Companies Act. This is the simplest form of business a foreigner can set up in Croatia, respecting the conditions and the registration steps with the Croatian Trade Register. With an extensive experience in this field, our company formation specialists in Croatia can provide complete registration services for both domestic and foreign investors in this country, mentioning that they can guide them throughout the entire registration process.
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Steps for opening a sole proprietorship in Croatia
Setting up a sole proprietorship in Croatia is not subject to harsh requirements, on the contrary, it can be registered fast and simple, bearing in mind a few formalities. Being self-employed is often the decision of small entrepreneurs from abroad looking to start operations in Croatia. Here are the most important requirements for establishing a sole trader in Croatia:
- Single entrepreneurs can only develop activities as sole traders, whether local or from abroad.
- The Crafts Act mentions the type of activities that can be established in Croatia.
- The personal information of the owners (name, nationality, residency) needs to be provided to the Croatian Trade Register.
- A proper business plan comprising details and costs of materials, equipment and consumables needs to be drafted.
- The business startup costs include specific registration fees and rental office costs if it is the case.
What are the necessary documents for opening a sole trader in Croatia?
Once the business name is decided and verified, the following documents will have to be prepared:
- The valid ID or the valid passport of the owner, in copies.
- The vocational qualifications are required for associated crafts businesses.
- The registration forms provided by the local business registration office in Croatia.
- The proof showing you can use the premises, if required for the activities you intend to develop.
- The Decision on Entry in the Register of Craft Business in Croatia.
- Proof that all the fees for registering the sole trader have been paid.
The next thing to do is to apply and obtain the official stamp of the firm with the State Administration Office in Croatia and then open a commercial bank account.
What other conditions are imposed for sole traders in Croatia?
Once the sole proprietorship is registered, the owner will have to register for pension funds with the Croatian Institute of Pension Insurance, and also with the Health Insurance Institute in Croatia. Besides that, it is mandatory to register for tax purposes and become a taxpayer in Croatia. Specific taxes are imposed for sole proprietors earning less than EUR 30,000, and it is recommended to hire the services of an accountant and keep track of your finances in the business. Even though the formalities for establishing a sole trader in Croatia are not that complicated, it is suggested to solicit the guidance and support of our team of company formation agents in Croatia, especially if you are a foreigner without knowledge of the applicable business and tax laws in this country. A personalized offer tailored to your business needs can be obtained from our consultants if you get in touch with us.
Taxation of sole proprietorships in Croatia
Compared to other types of businesses, a sole proprietorship can benefit from low taxes. As an example in this sense, a flat rate of 12% represents the income tax imposed for sole traders with profits of EUR 3,480 per year. The entire tax regime applicable to foreign entrepreneurs wanting to establish their activities as sole traders in Croatia can be explained by an experienced accountant who can also take care of the daily financial operations of the firm. Once the registration of the sole proprietorship in Croatia is concluded, it is recommended to ask for the services of an accountant. You may address such a request to our team and tell them your business intentions and the investments you want to make.
Why act as a sole trader in Croatia
Being the simplest form of business, a sole proprietorship can easily develop on the market, with a good business plan, and be directed to the sector of interest that offers most of the opportunities. Croatia is known as a country with a stable and appreciated economy, an excellent workforce, and a multitude of business possibilities in areas like tourism, manufacturing, arts, and many more. Regardless of your business ideas, you can easily establish a sole proprietorship in Croatia and enjoy the appreciated business climate of this country. Once your business develops, you can consider changing the business structure in a simple and fast manner.
Feel free to contact our company formation agents in Croatia and find out more about how you can open a sole trader in Croatia.