tpa-group (17.03.2020) Deferral of payment of social security contributions. The measure would be implemented by the amendment of the General Tax Act that would allow to the Minister of Finance to issue special regulations governing this area. Late penalty interest would not be charged during the deferral period and statute of limitation would not run. Per information provided during the Government session, the intended deferral in settlement would be 3 months with potential extension to additional 3 months, and taxpayers could also request settlement in instalments under certain conditions.
Deferral of payment of social security contributions for up to 3 months. Payments can be requested to be made in installments under certain conditions.
Text provided by SSPTW correspondent in Word format (vanda.crnjac-paukovic@mirovinsko.hr).
During the session of 17 March 2020 the Croatian Government proposed were the measures to stimulate the economy during COVID-19 pandemic. The measures concern a total of 8 ministries, majority of which relate to the preservation of the liquidity and jobs.
Tax measures include:
- Deferral of payment of corporate income tax and personal income tax liabilities and social security contributions. The measure would be implemented by the amendment of the General Tax Act that would allow to the Minister of Finance to issue special regulations governing this area. Late penalty interest would not be charged during the deferral period and statute of limitation would not run. Per information provided during the Government session, the intended deferral in settlement would be 3 months with potential extension to additional 3 months, and taxpayers could also request settlement in instalments under certain conditions, however, further details, including the first period subject to deferral are yet to be confirmed;
- Individuals will be entitled to an early personal income tax refund. Under the present legislation, a personal income tax refund based on an annual tax assessment is made upon expiry of the deadline for objection to the provisional notice of assessment issued in June, which was usually during August of the current year. The tax refund procedure has been changed so that the refund will be made at the time of delivery of the provisional assessment notice to the individual, who remains entitled to the objection rights. Based on this new measure, the individuals will receive their personal income tax refund for 2019 during June 2020;
- Grants to self-employed individuals used to alleviate the effect of the current crisis would not be regarded as taxable receipts (i.e. they will not be subject to personal income tax from self-employed activity);
- Companies receiving grants to alleviate the effect of the current crisis will be exempt from paying corporate income tax on such grants.