What to know about cryptocurrency in Croatia including trends, access, and taxes

Bitcoin retail shop in Split, Croatia
Bitcoin retail shop in Split

Croatia is fairly open-minded regarding cryptocurrencies. Paying in crypto is possible for certain hotels, museums, webshops, gas stations, humanitarian associations, and even local governments.

Whether you are super jazzed about crypto or just a bit curious, this guide will give you the lay of the land for cryptocurrency in Croatia.

In this post, we cover:

The facts are these…

What is cryptocurrency?

We do not wish to educate people on all the ins and outs of cryptocurrency. Our goal is to share with you what you should know about cryptocurrency IN CROATIA. However, to do that properly, we want to set a baseline for this article – so we will hit the highlights in brief.

Cryptocurrency (or crypto, in short) is a digital or virtual currency secured by cryptography. This encryption ensures they won’t be counterfeit or duplicated. They are usually organized into decentralized networks that are based on blockchain technology. Blockchain is a distributed database created by a disparate network of computers that tracks all cryptocurrency transactions.

Cryptocurrencies are significant because they are usually not issued by state authorities – meaning they are not subject to government interference or manipulation. They are decentralized electronic money that is easy to transfer without borders.

Crypto can be “traded” for goods, services, or currencies issued by the state (like kuna or euro).  After you buy them, they are saved in a digital wallet.

In addition to buying crypto, you can gain them through a process referred to as “mining” which is done as part of participation in the online production of crypto. It is also possible to gain them through the exchange, selling personal property, and donation – among other methods.

Cryptocurrencies available in Croatia

Cryptocurrencies are borderless, so they are all available in Croatia. There are currently over 6.000 cryptocurrencies on the global market. In 2013, there were only 33. Currently, the 20 largest ones occupy approximately 90% of the worldwide market.

Since 2008, Bitcoin has been the most popular cryptocurrency in Croatia and worldwide. Ethereum closely follows it. New cryptocurrencies are constantly emerging.

In the Balkans, Croatia, Serbia, and Slovenia are the most open to cryptocurrencies. They are up to date with the latest trends and have large communities of people investing in crypto.

How to buy cryptocurrency in Croatia

Cryptocurrencies can be bought via online platforms and physical cryptocurrency exchanges. They may offer the service of purchase, sale, storage, and use of cryptocurrencies.

You can buy cryptocurrencies by:

  • Cash
  • Credit cards
  • Bank transfers
  • Online or mobile banking through a Croatian bank
  • Payment slips called uplatnica
  • E-money transfer services like PayPal, Neteller, Transferwise, and Revolut
  • Digital wallet providers like Skrill

Purchases are possible at:

Bitcoin Store operated by Digital Assets d.o.o. was founded in Croatia. They offer the purchase, sale, storage, and use of cryptocurrencies for payment, which is regulated by HANFA – Hrvatska Agencija za nadzor financijskih usluga (Croatian Financial Services Supervisory Agency).

Current prices of cryptocurrencies on the market are available here.

How the sale (and purchase) of crypto is documented in Croatia

The value of acquired and sold cryptos is determined according to certified documents.

In Croatia, every purchase and sale must be confirmed by one of the following:

  • Certificate of online platform (decentralized stock exchanges or online traders)
  • Certificate of the exchange office which did the transaction
  • Contract (ugovor)
  • Decision (riješenje)
  • Confirmation (potvrda)
  • Print of transactions on an e-wallet (digital wallet)
  • Print of credit or debit card transactions used to purchase cryptocurrencies

If you purchased crypto from another natural person, the transaction must be documented by the agreement or another certified document that contains:

  • Personal data of the buyer and seller
  • Subject of sale
  • Date of sale
  • Amount and price
  • Number of sold cryptos
  • Method of payment

[Read: Difference between legal and natural persons in Croatia]

If you gain cryptos from a donation, you must have a donation agreement, proof of payment, or any other equivalent document that contains:

  • Personal data of the donor and receiver
  • Date of donation
  • Date of acquisition by the donor
  • Value of financial assets on the day of acquisition by the donor
  • Value (number of units and market value)
  • Signature

Taxes on cryptocurrencies in Croatia

Rules on paying taxes on cryptocurrencies depend on each country and its internal policies. Cryptocurrency transactions are still not regulated and supervised by Croatian laws. However, you must pay taxes depending on how you obtained your cryptocurrency.

#1 Sold cryptocurrencies

Income from the sale of cryptocurrencies in Croatia is treated as a form of financial transaction. This means that it is taxed in the same way as other receipts from financial assets. Sold cryptos are considered to be a type of receipt, so you must pay income tax called porez na dohodak.

[Read: All the taxes you might pay in Croatia]

Tax is calculated based on earned profit. The tax basis is a capital gain reduced by transaction costs and capital loss realized in the previous year. The tax rate is 10% plus prirez (surtax) of the city where you live. Surtax rates for Croatian cities and municipalities are available here.

There is one exception related to paying this tax. The profit earned in transactions where more than two years have passed from acquisition to sale is not taxed. If you sold crypto in less than two years, you must pay tax.

#2 Exchanged cryptocurrencies

If you exchanged your cryptocurrency for another type of cryptocurrency, you are not obliged to pay tax since you didn’t turn it into traditional currency (so-called fiat currencies). The income tax will be calculated only if you exchange the cryptocurrency for traditional money.

#3 Mined cryptocurrency

If you gain cryptocurrencies from the mining process called rudarenje, it is considered working income. In case you further use it for speculative trading through stock exchanges or online traders and you make a profit, you have to pay income tax. The basis for calculation is the difference between the purchase and sales value.

However, if you perform mining continuously to gain income over a long period and it is your only “job”, you must register a self-employment activity called samostalna djelatnost. Taxes are then paid according to the rules of payment for samostalna djelatnost.

The profit is then taxed according to this model:

  • 20% – Up to 360.000 kuna per year (up to 30.000 per month)
  • 30% – More than 360.000 kuna per year (more than 30.000 per month)

If you earn more than 7.500.000 kuna, then you must pay porez na dobit (profit tax) at 10-18% rate.

#4 Cryptocurrencies from incentives

If you earn cryptocurrencies from a specific incentive or promotion like watching ads, filling out surveys, promoting certain products on your website, or other means of advertising – then, you must pay tax based on working income or income from self-employment.

The profit is taxed according to this model for working income:

  • 20% – Up to 360.000 kuna per year (up to 30.000 per month)
  • 30% – More than 360.000 kuna per year (more than 30.000 per month)

#5 Cryptocurrencies from selling personal property

If you gain cryptocurrencies by selling your personal property, the received income is non-taxable. For example, if you sell a used table from your home in exchange for cryptocurrency – it would not be taxable.

#6 Donated cryptocurrencies

It is possible to gain cryptocurrencies through donations, including blogs, web pages, or online apps for which you receive donations in crypto. In this case, the income is non-taxable if you have certified documents proving cryptos are donated by natural persons who don’t perform samostalna djelatnost and if the gifts come from receipts taxed by income tax or receipts that are not considered income.

In other cases, you must pay income tax based on other income and contributions for pension insurance or income from self-employment if you perform a self-employment activity.

[Read: Do I need to open a bank account in Croatia]

Where is cryptocurrency accepted in Croatia?

Croatia is open to payment in cryptocurrencies instead of using traditional money. More and more points of sale accept it as a standard payment method.

In Croatia, crypto payments are accepted via:

  • PayCek of the company Electrocoin – Available here
  • FIMA Pay of the company Fima Plus- Available here

PayCek is the most preferred payment system and it is the most used by digital nomads.

[Read: How to apply for the digital nomad residence permit in Croatia]

Where to pay via PayCek

Payment via PayCek is available to certain places including:

View a complete list of locations where you can buy via PayCek here.

Where to pay via FIMA Pay

Payment via FIMA Pay is available in:

  • Čakovec
  • Osijek
  • Varaždin
  • Zagreb

View a complete list of locations where you buy via FIMA Pay here.

You can pay utility costs in cryptocurrencies in the following cities:

  • Cres on the island of Cres – Pay utilities here
  • Sveta Nedelja – Pay utilities here

[Read: How to set up utilities for a property in Croatia]

Cryptocurrency meetups in Croatia

There are several meetups in Croatia focused on cryptocurrency, however many of them are held in Croatian. You can always reach out to them directly to see which languages they use.

Meetups are organized by:

Cryptocurrency association UBIK

If you have any questions regarding cryptocurrencies, you may be interested in following UBIK or becoming their member. It is a small community of Croatian people who are heavily involved in the cryptocurrency world.

UBIK is a non-profit association focused on cryptocurrency trends in Croatia. It was founded in 2017 and is based in Zagreb. UBIK is an abbreviation for Udruga za blockchain i kriptovalute (Association for blockchain and cryptocurrencies).

They aim to create a strong community of people involved in the cryptocurrency domain in Croatia and surrounding areas. They organize educational workshops to provide relevant information, knowledge, and education on blockchain technology and the crypto market. They also support blockchain projects through legal, financial, and technological support.

UBIK’s official page is available here. They are also available on Facebook here and forum here.


Want to know definitively which taxes you’ll need to pay while living in Croatia?

Taxes in Croatia can get a bit sticky, especially when you throw in all the laws and treaties. Some countries do not have tax treaties in place with Croatia – like the United States and Australia – which further complicates tax situations. It can be very hard to know exactly what you might have to pay to the Croatian government.

We can connect you to an expat-vetted tax advisor and accountant who can perform a full evaluation of your tax liability in Croatia based on your personal situation.

To be connected with our tax wizards, please complete the below form based on your situation.

View our other financial articles


Sources:
https://paycek.io/
https://kriptomat.io/hr/kriptovalute
https://lider.media/poslovna
https://lider.media/poslovna-scena
https://www.tportal.hr/biznis
https://www.porezna-uprava.hr/HR

Please note: All information provided by Expat in Croatia is only for the purposes of guidance. It does not constitute legal or financial advice in any form. For legal advice, you must consult with a licensed Croatian lawyer. For financial advice, you must consult with a licensed Croatian tax advisor or accountant. We can recommend one if you contact us.

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