A limited liability company (d.o.o.)

Limited liability company is the most common form of company in the Republic of Croatia. It is defined by Article 385 of the Law on companies as a company in which one or more legal or natural persons contribute to the pre-agreed share capital.

The minimum amount of the share capital of a limited liability company is 2,500.00 EUR.

Establishing a limited liability company makes sense for several reasons. One of them is certainly tax. Thus, the d.o.o. that generated revenue up to 995,421.06 EUR pays the tax at the rate of 10%, while the d.o.o. that generated revenue above 995,421.06 EUR pays the tax at the rate of 18%. Dividend tax is 10%. On the other hand, income tax is paid at a rate of 30% on income amounts bigger than 47,780.28 EUR per year.   

When establishing the d.o.o., it is advisable to declare as many activities as possible since court and notary costs are the same regardless of the number of declared activities. If the founder subsequently wants to register additional activities, then the costs are the same as if it were a change in the memorandum. 

For foreigners who intend to establish a d.o.o., it is useful to know that members of the management board and Procurators do not have to be Croatian citizens. Board members can represent the company independently and individually or with the consent of other board members, all of which is regulated by the partnership agreement.

The name of the company can be in any of the official languages ​​of the European Union, but the headquarters of the company must be in the Republic of Croatia.

Board members do not have to pay contributions for pension and health insurance in the Republic of Croatia if they are already paying them in another country. Board members coming from countries of the European Economic Area prove their insured status with a so-called A1 certificate, while board members from countries with which the Republic of Croatia has social security contracts (BiH, Montenegro, Macedonia, Serbia, Turkey) prove their insured status with a certificate prescribed by these contracts. The certificates must be issued by the competent foreign holder of compulsory insurance and must not be older than six months.

 After the establishment follows the application to the commercial register. The application for registration in the commercial register together with all necessary attachments is submitted to the hitro.hr service. The founding deposit and court fees can be paid in FINA (Financial Agency) branches. At the hitro.hr service counter, documents are submitted for obtaining the Notification on the classification of a business entity according to the NKD (National Classification of Activities). Following the adoption of a decision on entry into the commercial register, information on the entry is published without delay on the register’s website.

The newly established company must be registered in the Register of Beneficial Owners, which is kept by FINA. The purpose of this register is to prevent money laundering and terrorist financing.

The company must also register with the National Bureau of Statistics in order to obtain a registration number according to the national classification of activities within 15 days from the delivery of the decision on entry into the register.

The company as well as the responsible persons must obtain a tax number – OIB. In this way, the Croatian tax administration is connected with tax administrations throughout the European Union.

Furthermore, the establishment of the company is reported to the tax administration, and a copy of the extract from the commercial register and the decision on the classification of the business entity is attached to such report. In addition to the above, the company must have a giro account in one of the commercial banks in the Republic of Croatia.