Croatian parliament planning to close the digital nomad permit loophole

Government of the Republic of Croatia
Government of the Republic of Croatia

PUBLISHED: 29.4.2024.

When the Croatian digital nomad permit was introduced in 2021, Croatia became an even more popular destination for those working from a laptop. It was one of the first countries in Europe to introduce such a program, and since then, hundreds of digital nomad applications have been approved every year.

Currently, new proposals for changes to the Foreigners Act are being discussed in the Croatian parliament. Proposed changes include the regulation of foreign workers as well as the closing of a loophole that many digital nomads have used to extend their time in Croatia.

In this article, we cover:

The facts are these…

What is the digital nomad permit loophole?

The digital nomad permit in Croatia can currently be approved for third-country citizens for one year and cannot be extended. All third-country citizens who qualify for this permit can apply for it online from abroad or at a police station within Croatia.

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

Many digital nomads who wanted to stay in Croatia longer than a year have been using a kind of loophole in the law to switch between different types of bases. This means that at the end of their stay, they would apply for a new residence permit on a different basis to extend their time in Croatia without taking a mandatory 6-month break between permits.

Here are some examples of “switching”:

  • Switching from the digital nomad permit to other purposes
  • Switching from other purposes to the digital nomad permit
  • Switching from being a digital nomad to the spouse of a digital nomad
  • Switching from being the spouse of a digital nomad to being a digital nomad

The Croatian government does not like these combinations, as the law was not intended to be used in this way. That is why they intend to close the loophole with a change to the law that is coming to a discussion in the parliament soon. Through their internal documents, some Croatian police stations already deny the possibility of switching between these permits, which means they don’t allow this option.

We have helped many digital nomads apply for residence and settle in Croatia. If you’d like personalized help with your transition, contact us here.

To whom does the digital nomad loophole apply?

This scheme was used by some third-country (non-EU/EEA) citizens. Some of them were successful with switching between different types of Croatian residence permits. Apparently, things are going to change now, and everyone applying for residence in Croatia will have to follow the rules about the length of their stay.

If you are a citizen of an EU/EEA country, you are entitled to live in Croatia, so a digital nomad permit is not for you. Please note that EU/EEA citizens still must register their residence to stay in Croatia for more than 90 days. If you plan to move to Croatia but don’t know where to start, or you want to create your new life in Croatia, contact us, and we’ll help you with anything you need.

[Read: How EU/EEA citizens can get temporary residence in Croatia]

How does the loophole work in practice?

When applying for temporary residence in Croatia, you must choose a basis on which you apply. According to that basis, certain rules and requirements are applied both during the application process and once you get a residence.

Being a digitalni nomad (digital nomad) is one basis, druge svrhe (other purposes) is another basis. Under other purposes, you can pick between several options of applying for residence, including prepaying rent, owning a residential property, and learning the Croatian language.

View our residence guides:

Currently, the Zakon o strancima (Law on foreigners) states that you must wait 6 months between residence permits based on being a digital nomad. This means that if you want to apply for another digital nomad residence permit after the first one expires, you must take a 6-month break after the expiry, and then you can apply for the new one. The same clause also applies to other purposes.

However, if you switch from the digital nomad basis to other purposes basis or vice versa, you can avoid the waiting time – you don’t have to wait for 6 months to apply for another residence permit, meaning you can stay continuously within Croatia without leaving. This is considered a loophole in Croatian law.

Furthermore, there is another loophole related to spouses. Those married to a digital nomad who has a temporary residence in Croatia can get residence based on family reunification with a digital nomad. Some digital nomads have working spouses, so one spouse is a digital nomad for one year, and the other is on family reunification. The next year, they switch places.

[Read: How to apply for temporary residence in Croatia based on family reunification]

These loopholes are rarely used in a legal manner and are not in the spirit of Croatian law, which is why the Sabor (Croatian parliament) has proposed closing them.

What is the new proposal of the law related to residence in Croatia?

The new proposal of the law states a person must wait 6 months from the end of their last residence permit before they apply for a new permit based on the following:

  • Being a digital nomad
  • Family reunification based on a spouse who is a digital nomad
  • Other purposes

The new proposal also recommends an extension of the digital nomad permit validity to 18 months instead of the current 12 months. This means that everyone who would get a residence permit based on being a digital nomad could stay in Croatia for up to 18 months at once.

Below is a screenshot of what MUP confirmed to us about the new proposal, which is straight from the proposal. After the screenshot, you’ll find an English translation.

mup response

Below is the English translation:

For other purposes, a citizen of a third country can apply after the expiration of six months from the expiration of the validity of a temporary residence that was approved for other purposes, a temporary residence that was approved for a digital nomad, or a temporary residence for the purpose of family reunification or a life partnership with a digital nomad.

For the purpose of staying as a digital nomad, a citizen of a third country can apply after the expiration of a period of six months from the expiration of the validity of a temporary residence that was approved for a digital nomad or a temporary residence that was approved for other purposes or a temporary residence for the purpose of family reunification or life partnership with digital nomad.

It was also proposed that the temporary residence permit be issued for a period of validity of up to 18 months for temporary residence for the purpose of residence of digital nomads, within which period it can be extended once.

Note: This is just a proposal, given that the adoption procedure is ongoing.

You can see the full draft of the law here.

[Read: How laws are made in Croatia]

Why is the Croatian government making this law change?

We are not behind closed doors in Parliament. So, we do not want to put words in their mouth. That being said, we are constantly working with MUP to fact-check our information, staying on top of developments in immigration and have been studying Croatia’s bureaucracy for the last 11 years. Additionally, the lawyers with whom we collaborate have spoken to the people making these decisions and they shared those insights with us.

Based on all of that, we feel comfortable with our educated guesses on why the Croatian government is making these changes.

First, the purpose of the digital nomad permit is to attract remote workers with high incomes to come to Croatia for one year and then leave – to be nomadic. They are offered a tax exemption on their working income and an exemption from the state health care system as incentives. If you are switching your residence basis to extend your stay, then you are not acting as a digital nomad and in the spirit of this permit’s intention.

[Read: Healthcare and health insurance in Croatia]

Second, a digital nomad is only permitted to work for a company not registered in Croatia. The spouse of a digital nomad and anyone with residence based on other purposes is not allowed to work at all for anybody.

If you are a digital nomad and you switch to other purposes, that means you are working illegally. If you are a digital nomad and you switch to being the spouse of a digital nomad, you are working illegally. If you are the spouse of a digital nomad or for other purposes and you do not report your income to the tax authority, then you are committing tax evasion.

Third, if you use the digital nomad permit again and again, it means you are not paying income tax in Croatia nor are you paying into the state health care system. You are using infrastructure and services in Croatia without contributing to it.

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

When will the loophole change happen?

The draft of the proposal to change the Law on foreigners is under discussion and open to comments. You can view Nacrt prijedloga zakona o izmjenama i dopunama zakona o strancima (Draft proposal of the law on amendments to the law on foreigners) here.

Croatia held parliamentary elections on April 17, 2024, and the government is about to change. The dust needs to settle, and then we expect this law to be passed.

These are not the only changes to the law. There will also be some changes to the regulation of foreign workers due to the increased influx of foreign workers to the Croatian market in the last few years. This refers to those coming to Croatia from abroad to work for Croatian companies. This is a pressing matter.

We estimate that the law will be solidified in the next 3 to 6 months. We will announce it once it is finalized.

If this applies to you, this may come as a shock. Now that you know, you can make plans on how to deal with it. In the next section, we’ll discuss solutions.

View our work guides:

What are your options for staying longer in Croatia?

If this law is passed, then that means you must wait 6 months in between applications. In reality, that means that at the end of your permit, you must leave for at least 90 days. Then you can return as a tourist. Once 6 months and one day has elapsed, you may apply again. So, in short, this means you must leave Croatia for 3 months before returning.

If you’d like to stay continously without leaving Croatia, then you must apply for temporary residence on some other basis that is not a digital nomad or other purposes, including:

  • Family reunification with a Croatian or EU/EEA citizen – view a guide here
  • Work based on a Croatian work contract – view a guide here

If you have Croatian heritage but you don’t have Croatian citizenship, then you may qualify for residence based on humanitarian reasons. View our guide here.

Does this change affect you? Unsure where to or what to do next? We can help! We can coach you on the best options for your situation. Contact us here.

If you want to live in Croatia long term, then invest in Croatia. Open a business, get a job, or marry your Croatian soul mate – do something to put down roots. There have been no signs that Croatia will widen its doors to those who aren’t truly invested in the country.

[Read: How to get married in Croatia if at least one spouse is a foreigner]

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Frequently asked questions

Does Croatia have a digital nomad visa?

Croatia has a digital nomad permit, which is actually a residency permit, and not a visa like in some other countries that welcome digital nomads. What many refer to as a digital nomad visa, in Croatia falls under a different type of process which is applying for temporary residence under the digital nomad clause.

How do I apply for a digital nomad permit in Croatia?

You can apply online or in person at an administrative police station in Croatia. Collect all the documents needed for a digital nomad permit and submit the application. After that, you will wait for your permit to be approved, which will then allow you to move to Croatia and work remotely.

Who can apply for a digital nomad permit in Croatia?

If they qualify, third-country citizens can apply for a digital nomad permit in Croatia. Citizens of the EU already have the right to live and work in Croatia, so they cannot apply for this permit.


Sources:
Digital nomad statistics
Nacrt prijedloga zakona o izmjenama i dopunama zakona o strancima

Please note: Information provided by Expat in Croatia is only for the purposes of guidance. It does not constitute legal or financial advice in any form. Croatian laws and bureaucratic rules often change, and each personal case is individual, so different rules may apply. For legal advice, contact us to consult with a licensed Croatian lawyer. For financial advice, contact us to consult with a licensed Croatian tax advisor or accountant.

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