Croatia will implement mandatory e-invoicing and real-time digital reporting for all VAT-registered businesses starting January 1, 2026, under its Fiscalization 2.0 reform. The new system introduces a Continuous Transaction Controls (CTC) model covering B2B, B2G, and B2C transactions, with a wider rollout to non-VAT businesses by 2027. A national testing phase begins in September 2025, aiming to ensure smooth adoption and support tax transparency, automation, and fraud prevention.
Croatia Confirms Mandatory E-Invoicing for All VAT-Registered Businesses from 2026
Public
Croatia
Author: Vukašin Santo
Category:
Fiscal subject related
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27
Content accuracy validation date:
25.07.2025
Content accuracy validation time:
08:47h
Croatia has officially confirmed the rollout of mandatory electronic invoicing (e-invoicing) and real-time digital reporting for all VAT-registered businesses, effective January 1, 2026, as part of the government’s ambitious Fiscalization 2.0 initiative.
Fiscalization 2.0: A New Era of Digital Tax Compliance
The newly approved Fiscalization Law, in effect from June 13, 2025, introduces a Continuous Transaction Controls (CTC) model, requiring the issuance, transmission, and real-time reporting of invoices to the Tax Authority for B2B, B2G, and even B2C transactions. This move places Croatia among the leading EU countries embracing real-time tax control systems.
Signature Features of the Reform:
- Mandatory e-invoicing for VAT-registered businesses from January 1, 2026
- Extension to non-VAT businesses and public bodies by January 1, 2027
- Decentralized e-invoicing model using certified providers and compliance with EU Standard EN 16931
- Real-time reporting of invoice data to the Tax Authority, including payment status, product codes, bank details, and error declarations
- Mandatory reporting by both invoice issuers and recipients, including invoice rejections and failed submissions
Testing Phase Starts in September
To support smooth adoption, a testing environment for the updated tax system will be made available from September 1, 2025. Businesses and their software providers will be able to test invoice creation, digital signature processes, and data transmission to the tax authorities ahead of the official launch.
National Tools and Support for SMEs
Croatia’s system supports open standards such as Peppol and FiskApplication, and a free government-issued invoicing tool, MIKROeRAČUN, will be offered to micro and small businesses not registered for VAT. This tool will allow the creation, submission, and storage of compliant e-invoices at no cost.
Strategic Objectives and Benefits
The Fiscalization 2.0 reform is designed to:
- Simplify VAT reporting obligations
- Improve accuracy in tax returns
- Enhance transparency and traceability
- Minimize tax fraud and errors
- Reduce administrative burden
- Foster interoperability and competitiveness
By fully digitizing invoice flows and automating real-time tax reporting, Croatian authorities expect a significant step forward in closing the VAT gap and boosting fiscal discipline.
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