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The Tax Administration reacted to the incorrect statements of some media articles announcing the introduction of a "new" tax for renters, and we are transmitting their statement in full.
Current amendments to the Law on Local Taxes (hereinafter: ZLP) no new tax is introduced, nor is the method of its application expanded or changed.
According to the provisions of the ZLP, tax on kuće za odmor is an optional tax, which means that local self-government units decide by their decision whether to introduce a tax on vacation homes. Along with the decision to introduce a tax on vacation homes, the local authority units ( LGUs ) are authorized to prescribe the amount of taxes, within the limits set by the ZLP, depending on the location, age, condition of the infrastructure and other circumstances relevant to the use of the holiday home, and the competent tax authority for determining and collecting taxes.
These changes to the ZLP, at the request of individual local self-government units, increase the upper limit for prescribing the amount of this tax and specify the provisions on determining the status of a vacation home in the case when the property in question is used for tourism rental.
Namely, in order to determine the obligation of tax on vacation homes, as one of the forms of property tax, it is important to determine whether it is a building or part of a building or an apartment that is used occasionally or seasonally, that is, it is important to determine that the property in question is not intended for permanent use ( for the residence of the owner or another person or for another permanent purpose of use). Renting apartments, rooms and beds to travelers and tourists, which is provided according to a special regulation, is an activity performed by a natural person, and on the basis of the activity, the income from the activity is subject to the obligation to pay income tax according to the provisions of the Income Tax Act. If the activity of renting out apartments, rooms and beds to travelers and tourists is provided only in part of the calendar year, it is clear that such property is used occasionally or seasonally, and regardless of the performance of the activity in the property in question, it is subject to the obligation to pay tax on vacation homes.
Tax on vacation homes and income tax paid by renters are tax forms that are determined independently of each other, because they are taxes that are determined on different bases. Tax on vacation homes is determined based on the ownership and manner of use of a certain property, while income tax is determined based on the performance of the activity according to the income generated or according to another criterion.
This interpretation of these tax forms stems from the basic principles of taxation based on three pillars (work, property and consumption) which are implemented in the legal provisions on the obligation to pay these taxes. The Tax Administration interprets and implements these legal provisions in an unchanged manner since the introduction of these tax forms, which is also clearly visible from the opinion on taxpayer inquiries published on the Tax Administration's website.
Side dish: popis_misljenja - Tax on vacation homes and annual flat rate... (porezna-uprava.hr)
Photos: Vlada Karpovich
