Well, do you need a bank account?
Yes and no.
Let’s start from the beginning.
Everyone who is in the residence application process needs to have a bank account in Croatia. The Policija ask everyone, for the most part, to prove they have enough funds to support themselves. This amount varies by situation. It can be as much as 30.000kn and as little as 2.000kn.
For example, if you have a dependent, you’ll need to show you have more than if you were a single person. If you are renewing a residence permit, you may need to show much less as you were already initially vetted.
If you are an individual without a business or a job in Croatia
If you are financially independent or employed outside of Croatia, then you only need a bank account temporarily.
Once the Policija have given you the amount you need to have, deposit that amount into the bank. Then ask the bank to provide you with proof of this balance that you will then give to the Policija.
After you show this document to the Policija, you can withdraw the amount from the bank if you don’t want to keep it there. Then, once you have your residence permit, you may close this bank account.
Really. If you are financially-based outside Croatia, then it doesn’t make a lot of sense to pay a monthly fee to have a bank account in Croatia if you aren’t going to use it. Bank accounts are used primarily for bill payment. As an alternative, you can pay bills at Posta for a fee of 5-6kn per bill. For invoices associated with your health insurance, a small percentage is charged to pay the bill instead of a flat amount, which is negligible.
If you make all your money outside Croatia, it’s not a good idea to move large amounts into a Croatian bank account for use. This puts you on a radar you don’t want to be on.
If you are an individual that owns a business
Yes, you most definitely, unequivocally need a bank account. This is where your salary will be deposited as long as you own the business and collect a salary.
If you are individual with a job
Yep, you need a bank account too. This is where you’ll receive your salary.
How to open a Croatian bank account
If you plan to pay bills from this account, best to sign up for internet banking and bill pay. You’ll be charged a small fee, less than 10kuna usually, per month for this service.
What else should I know?
If you have any debt in Croatia whatsoever, the government will take it out of your bank account without warning.
Haven’t paid your national health insurance fee? First they freeze the money, then they take it, and you will not get it back. I would avoid a situation where the government must resort to freezing your bank account as it is a laborious and extremely stressful process to get it unfrozen and chances are you, you’re not getting that money back. If they took your money, then you probably owed that money.
To be clear, getting your account “unfrozen” does not mean that you get your money back. It only means that you have proven that you’ve satisfied the debt in full, at which point your account will be unlocked and usable again.
Are you an American?
Even in Croatia, you cannot get away from Uncle Sam.
As part of FACTA, the US “requires” foreign banks to report bank accounts for all American citizens. By “requires” I mean, they have threatened to freeze wire transfers that go through the US from the foreign bank for non-compliance.
If you are an American citizen and plan to open a bank account in Croatia (or any foreign country really), the process is lengthier than for non-Americans. Be prepared to complete some IRS tax forms. You may also need to provide a third ID (like a drivers license) that shows an American address, in addition to your passport and Croatia ID.
There is a lot of paperwork. It can take an hour to sort through all of it with the bank. Usually, you’ll get a banker who has not done this before. That also adds time, but be patient. Remember that these kind Croatians are having to fill out tax forms for the overbearing United States.
On top of the FACTA requirement for banks, you as the citizen are required to file an FBAR annually if you have foreign accounts with a combined value of $10,000 at any time during the tax year. You can file an FBAR online here. Please note that this $10,000 threshold could increase at the discretion of the IRS in future tax years. Here is what can happen to you if you fail to file an FBAR.
Freedom tastes good, doesn’t it.