If the taxpayer disagrees with the assessment, they may lodge an appeal with the second instance authority. The appeal must be lodged within 30 days of receiving the resolution. The filing of the appeal defers payment of the tax assessed.

If the taxpayer disagrees with the resolution of the second instance authority, they may begin formal litigation proceedings with the Administrative Court within 30 days of receiving the resolution. However, at this point the deferred tax must be paid.

In July 2015, the Croatian tax authorities published a guidance enabling taxpayers to obtain a binding tax ruling. As per the guidance, a binding tax ruling can be obtained by filing a request to the tax office or to the large taxpayers’ office on any of the following concerning issues:

The tax treatment of investment projects with a value of at least HRK 20 million (~USD 2.9 million);
The tax base for a corporate restructuring, such as mergers, divisions, etc.;
The application of tax treaties;
The determination of Input VAT deductions; and
Certain other business matters where tax treatment is unclear.

The tax authorities must issue the ruling with 60 days of receipt of the request. A possible extension of 30 days is provided in case of complex cases. In general, once a ruling is issued, it will remain valid unless the factual circumstances or the relevant legislation changes, or it is found that the taxpayer did not present factual information to the tax office when the request was made.

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