GLOBAL MINIMUM TAX

The global minimum tax introduces a minimum effective corporate income tax rate of 15 % for large multinational and large domestic corporate groups.

Although the Global Minimum Tax Act was incorporated into Croatian legislation at the end of 2023, tax returns related to this tax will be filed for the first time in 2026. For this reason, we would like to draw your attention in advance to the upcoming administrative obligations.

Entities subject to the Global Minimum Tax Act in Croatia

The global minimum tax rules apply to multinational corporate groups and large domestic groups that generate revenues exceeding EUR 750 million on a consolidated basis in at least two of the previous four years. Croatian companies that are part of such groups may also fall within the scope of these rules.Croatian companies that are part of large groups are required to:

–  Analyse their position within the group;

–  Calculate the effective tax rate (ETR) for the jurisdiction;

–   Assess whether a top-up tax liability arises in Croatia;

– Examine the applicability of simplified calculations (safe harbour provisions);

–  Where several companies of the same group operate in Croatia, appoint one entity as responsible for all rights and obligations arising from this tax; and

– Submit tax returns to the Croatian tax authorities in a timely manner.

Tax returns and submission deadlines

The Global Minimum Tax Act provides for the submission of the following three reports:

–   GloBE Information Return (GIR), which contains information on the group structure, jurisdictions in which the group operates, the calculation of the effective tax rate, the application of safe harbours, etc

–   The first GloBE Information Return must be submitted 18 months after the end of the first fiscal year in which the rules apply;

–    For all subsequent years, the deadline is 15 months after the end of the fiscal year;

–    If the fiscal year corresponds to the calendar year, the deadlines are as follows:

–   30.6.2026 – for the financial year 2024

–  31.3.2027 – for the financial year 2025Exception: The GloBE Information Return does not need to be submitted to the Croatian Tax Administration if it is filed by the ultimate parent entity in a jurisdiction that has an information exchange agreement in place. In such cases, the Croatian Tax Administration must be duly notified.

–  Top-up tax return, which determines and reports any top-up tax liability.

–   Must be submitted within 30 days after the deadline for filing the GloBE Information Return;

–  For taxpayers with a calendar fiscal year, the 2024 must be submitted no later than 30.7.2026.

–  Qualified domestic top-up tax return (QDMTT return), which determines and reports any domestic top-up tax liability.

–   Must be submitted within the same deadlines as the GloBE Information Return;

–   For taxpayers with a calendar fiscal year, the 2024 return must be submitted no later than 30.6.2026.

All returns must be submitted electronically.

The Ordinance, which will provide further details on the form and content of the returns as well as on the implementation of the Act, is still pending.

If you have any questions or concerns regarding your obligations under the global minimum tax rules, please feel free to contact out tax team at any time.