16 July 2013

As from 1 July 2013, Croatia is a membership of the European Union. As a consequence, the EC Regulations on the coordination of social security regulations (883/2004, 987/2009, 1231/2010) will apply in employment relations with workers who are posted from Belgium to Croatia (and vice versa), as well as for employees/self-employed performing activities in both countries.

Social security

Previously, this was monitored by the bilateral social security agreement concluded between Belgium and Croatia.

If an assignment to or from Croatia had already commenced before 1 July 2013 and is extended after this period, the posting period will continue. Only the issued document will change (A1 instead of BE-HR101). The elapsed period before 1 July 2013 will be taken into account to determine the total duration of the posting (in principle max. 5 years).

The agreements between the EU and Switzerland and between the EU and Norway, Iceland and Liechtenstein (EEA) have not yet been modified. This means that at present the rules as applicable before 1 July 2013 continue to apply if one these four countries is involved.

The obligation to apply for a work permit, allowing Croatian workers to work in Belgium remains in force (until June 30, 2015, possibly extended). The free movement of services is not limited and therefore Croats may establish themselves in Belgium as self-employed persons without a professional card.


From a VAT perspective, the EU accession of Croatia on 1 July 2013 involves the following changes:

  • the supply of goods from an EU VAT payer to a VAT payer established in Croatia is now considered an intra-Community supply of goods instead of an export. As a consequence, Croatian VAT payers should always communicate to the supplier their Croatian VAT identification number when acquiring goods from another EU Member State, as this will allow the supplier to exempt the intra-Community supply in the country from where the goods have been dispatched. The Croatian customer should account for the VAT due in the VAT return by means of the reverse charge mechanism. The supplier should also take into account the concerned supply for the Intrastat return and European Sales Listing;
  • the supply of goods to private persons is normally subject to VAT in the EU Member State from where the goods are dispatched. However, the VAT exemption for export no longer applies. EU companies that dispatch goods to private persons in Croatia, should take into account a distance sales threshold of HRK 270 000 (+/- 36 000 EUR). With the accession on 1 July 2013, this threshold is halved for the sales during the second half of 2013. When is exceeding the threshold, the supplier is deemed to register for VAT purposes in Croatia in order to charge Croatian VAT (standard VAT rate: 25%);
  • service supplies in a B2B context to Croatian customers, will take place in Croatia. As a consequence, the customer should apply the reverse charge mechanism. Also in this case the supplier should always mention on its outgoing invoices the VAT identification number of the customer and include the services supplied in the European Sales Listing (if required);
  • When reporting incoming transactions with Croatian contracting parties, an adjustment of the related reporting obligations should be taken into account (e.g. different boxes in the VAT return).

The above implies that VAT payers will have to verify and adjust their supplier and customer data in their ERP systems if they are doing business with Croatian entities. The accession may have an impact on the reporting in the VAT return, the Intrastat declaration and the European Sales Listing. The procedure for VAT refund of Croatian VAT on incoming invoices will be simplified for EU companies. 


Questions regarding this topic can be addressed to our Competence Center Employment Tax and Legal Services or our Competence Center VAT .