Important Changes to the Application of Tax Regulations in 2026

Important Changes to the Application of Tax Regulations in 2026

In December 2025, legislative amendments were published, which brought about changes in tax regulations and rules. They are mainly applied from January 1, 2026, with some exceptions, which are listed below, along with other relevant tax information.

General Tax Act

The Act on Amendments to the General Tax Act amends and supplements the provisions governing tax secrecy, exemptions from the obligation to issue invoices, electronic data processing, providing information in tax proceedings, imposing administrative measures and tax offences. In addition, it introduces the obligation to submit codes and passwords of software solutions used to carry out the fiscalization procedure, for the purpose of their verification.

The Act enters into force on 1 January 2026, except for the provisions relating to tax secrecy (Article 8, paragraphs 15 to 20), which shall apply from 1 January 2027. The provisions on the obligation to compile a statistical report have been deleted, with a transitional rule according to which the report for 2025 is submitted within the prescribed deadlines during 2026.

Value Added Tax

The Act on Amendments to the Value Added Tax Act extends the deadlines for submitting certain VAT returns and forms to the last day of the current month. The provisions on exemption from the obligation to issue invoices are amended, and an exception has been introduced according to which the recipient’s consent to accept invoices in electronic form is not required in the case of the obligation to issue e-invoices in accordance with the Fiscalization Regulation. Furthermore, the obligation to submit certain forms is abolished, the procedure for changing the method of taxation is further clarified, and the misdemeanor provisions are amended.

The above changes will apply from 1 January 2026.

The Value Added Tax Ordinance has been amended to align with the amendments to the VAT Act. As of 1 January 2026, the VAT return (VAT Form) will also be amended and will contain information on free food deliveries.

Corporate Income Tax

The Act on Amendments to the Corporate Income Tax Act amends the provisions regulating the status of certain taxpayers, including pension and investment funds, expands the possibilities of reducing the tax base for sponsorships made domestically for certain non-profit purposes, along with a prescribed procedure for determining eligible entities, and amends the provisions on donations for health needs.

The methods for determining transfer prices have been further specified, the possibilities for concluding advance transfer pricing agreements have been expanded, the rules on the inclusion of tax paid abroad, the maturity of tax liability, bookkeeping and documenting tax treatment have been amended, and the provisions on tax returns and the application of other regulations have been adapted.

This Act applies from 1 January 2026.

Global Minimum Tax

The Act on Amendments to the Global Minimum Tax Act amends the provisions relating to the scope of application, qualified domestic minimum top-up tax, reporting obligations, filing and payment of top-up tax, misdemeanor provisions and the application of the undertaxed profits rule in the Member States.

The above amendments shall apply from 23 December 2025.

Change in the interest rate on loans between related parties for 2026

The interest rate on loans between related parties referred to in Article 14, paragraph 3 of the Corporate Income Tax Act for 2026 is 2,65 %. It was published in the Official Gazette No. 150/2025 of 12 December 2025 pursuant to the Decision on the publication of the interest rate on loans between related parties.

The stated interest rate is relevant for the recognition of tax-deductible interest expenses on loans received, or interest income on loans granted between related parties. The same applies to financing between resident related parties, if one of the related parties has a preferential tax status (applies a lower corporate income tax rate or is exempt from corporate income tax) or is entitled to carry forward tax losses from previous tax periods. It also applies to existing loans.

Exceptionally, for the purpose of determining the marketability of loans between related parties, the taxpayer may, in addition to applying the transfer pricing rules, determine and prove the application of a different interest rate, provided that such a method of determination is consistently applied to all loan agreements between related parties.

Public CbC reporting

Amendments to the Accounting Act in 2023 introduced the obligation of public reporting on corporate income tax by country (public CbC reporting), in accordance with European Union regulations, with the aim of increasing tax transparency of large multinational groups.

The obligation applies to financial years starting on or after 1 January 2024, and the report is published no later than 12 months after the end of the business year, which for most taxpayers means no later than 31 December 2025, if the financial year ends on 31 December 2024.

This obligation applies to multinational groups with revenues exceeding EUR 750 million in the previous two consecutive business years, as follows:

• independent entities and ultimate parent companies with headquarters in the European Union, unless they operate exclusively in the Republic of Croatia and not in any other tax jurisdiction,
• medium-sized and large enterprises in the Republic of Croatia controlled by an ultimate parent company outside the European Union,
• branches in the Republic of Croatia whose ultimate parent company is outside the European Union, if such company does not have a medium-sized or large dependent enterprise in the European Union, provided that the net revenue of the branch exceeds EUR 10 million.

The report is published on the company’s website and entered into a publicly available register, with the possibility of exemption from publication on its own website if the report is already publicly available free of charge through the court register in the European Union, with the obligation to publish information about this exemption.

The obligation does not apply to financial institutions, and in exceptional cases it is permitted to temporarily exclude certain data from publication if their disclosure could seriously harm the company’s business position.

Fiscalization 2.0 and e-invoices

The Fiscalization Act entered into force on 1 September 2025 in a minor part relating to the fiscalization of final consumption invoices, while the most significant changes will apply from 1 January 2026.

From 1 January 2026, fiscalization will be extended to all entities subject to fiscalization in final consumption, regardless of the method of payment. It will also introduce the obligation to fiscalize in activities in which the majority of turnover is related to the retail sale of daily newspapers, tobacco and postal securities.

From 1 January 2026, the obligation to issue and receive e-invoices for taxpayers in the VAT system will be introduced, as well as the obligation to receive e-invoices for companies, craftsmen, freelancers, state administration bodies, local and regional self-government units, and budgetary and extra-budgetary users who are not in the VAT system. Entrepreneurs outside the VAT system are allowed to use the MIKROeINVOICE (cro. MIKROeRAČUN) application free of charge. From 1 January 2027, the obligation to issue e-Invoices will also be extended to these taxpayers.