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Tax treatment of tips in Croatia
Summary
Changes to the Law on Income Tax stipulate that the amount of the tax-free tip is set at €560 x 6 = €3,360 (for all cash and car payments). Consequently, the tip amount above the non-taxable part is taxed as final other income at the rate of 20% (calculation of tax without contribution).
Content
This will be implemented in such a way that for each charged receipt (in cash or by card), the tip amount is to be reported in fiscalization. The employer will report the monthly amount of the collected tip to the employee's OIB through the JOPPD form. And finally, income tax is calculated on the amount that exceeds the tax-free amount of the tip.
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