All details on subsequent taxation

An information brochure from the Croatian National Tourist Board, which has been distributed at the fair since yesterday, says a lot about the general procedure, but also leaves a few questions unanswered (you can find a PDF of the leaflet here). To clarify these last points, YACHT spoke at the trade fair with Branimir Mader from the Croatian Chamber of Commerce, who has been commissioned by the responsible ministry to deal with questions relating to subsequent taxation.

To anticipate this: It appears that the Croatian government has found a very practical and relatively uncomplicated way to implement subsequent taxation. If everything is really implemented as Mader promised in the interview, the situation for owners should ease considerably. He was able to clear up two critical points in particular during the discussion. Firstly, he stated that all ships older than eight years do not have to be taxed subsequently. However, the relevant law is still being scrutinised by the EU. However, it is expected that this regulation will come into force shortly. This means that thousands of owners can breathe a sigh of relief.

The second important point is that there is no need to rush when it comes to implementing subsequent taxation, as applications submitted before the deadline of 31 May will still be processed after the deadline and the ships will be taxed at five per cent. Anyone submitting an application should therefore be sure to obtain written confirmation that the deadline has passed!

The following is the current status of taxation:

1. Owners must change to the Croatian flag for subsequent taxation and have their boat entered in the Croatian yacht register. According to Mr Mader, the owner can leave the register again whenever he wants after reflagging, but must go through the bureaucratic process again and also pay the fees incurred. At present, the authorities still require written proof that the boat has been deleted from the "home register". This is to be cancelled shortly, as the International Boat Licence, which most owners have, is not an official register.
2. The owner must be registered in the tax register of the Croatian Ministry of Finance.
3. The basis for calculating the subsequent taxation is the current value of the ship. This does not have to be determined by an expert opinion; information provided by the owner is sufficient. If the owner provides information that the Croatian authorities consider to be too low, they reserve the right to set prices according to standard used boat price lists, including the Eurotax-Schwacke.
4. The owner can commission shipping companies, marina operators, charter companies or consultants to carry out the necessary steps for subsequent taxation. The condition is that they must be based in Croatia. The Ministry will not provide an official list of suitable companies. The agency can set its own fees, so owners are strongly advised to compare prices!
5. The amount of the tax is 5 per cent, plus customs duties of 1.7 per cent.
6. The deadline for subsequent taxation expires on 31 May 2013. Anyone who has not submitted the application for subsequent taxation by then must do so at the standard Croatian VAT rate of 25 per cent.
7. The ministry has set up a central information e-mail address for enquiries about detailed problems of individual owners, which owners can write to: nautika@hgk.hr. At present, emails can only be answered in English, Croatian or Italian.
8. Further ancillary costs of subsequent taxation are incurred for entry in the shipping register, administrative fees, etc. The scale of fees is currently being revised and prices are set to fall significantly; a boat over 12 metres in length would then probably cost 700 euros in fees, while only 20 euros are being discussed for boats under this length. In addition, there is the payment of the agency, haulage company etc., which takes care of the administrative procedures for the owner. This can be determined by the company itself; at present, initial estimates suggest costs of around 1 per cent of the current value of the yacht. As soon as the editors have more models, we will publish them.
9. If your yacht has already been taxed, only official tax documents or original invoices will be accepted as proof. Used boat contracts between owners that simply state "VAT has been paid" or similar will not be accepted!