If your planning to start a business in Croatia, the first step is deciding what kind of business to open. The type of business structure is critical to the success of your company, and should match your business goals.
In Croatia, there are 4 main types of businesses.
An udruga is for non-profit organizations, whose primary function is to “protect their interests or for the protection of human rights and freedoms, as well as environmental, humanitarian, informational, cultural, national, pro-natalist, educational, social, professional, sporting, technical, medical, scientific or other beliefs and goals”. To start an udruga, you must have a minimum of 3 owners.
Good for: Non-government organizations, charities
A d.o.o. is the equivalent of a limited liability company, and is the most common business in Croatia. A d.o.o. can be owned by one or multiple persons. To set up the company, 20.000 kuna in start up capital is required. However, if you are a non-EU national, the start up capital required can be as much as 100.000 kuna.
Good for: All types of for-profit businesses
View our guide on how to open and close a d.o.o. company in Croatia.
A j.d.o.o. is the same as a d.o.o. typically used for companies with limited start up capital. It only costs 10 kunas to start the company initially. However, after a specified period of time (typically 90 days), you must prove that you have taken in 20.000 kuna of revenue. This is proven by audit, the cost of which you need to subsidize. The cost of an audit is in the ballpark of €1000.
Good for: Businesses with low overhead and upfront start up costs such as online businesses
Bad for: Caffes, restaurants, manufacturing, retail
A t.o., which stands for “trgovački obrt”, is not a company in the traditional sense and is instead connected to a specific person and the type of “craft” in which they specialize. For example, locksmiths, hair stylists, and carpenters would all fall into this category. While a t.o. can have employees like a company, the business lives and dies with the person unlike a company e.g. the entity cannot go on without the individual who has registered their “craft” as a t.o.
This type of business is slowly fading away, as more businesses opt for the more common and capitalism-friendly d.o.o. On the plus side, as a t.o. is not considered a traditional company, it does not require the standard 20.000 kuna of start up capital.
Good for: Individuals with a professional trade or craft
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