Words tax haven (not heaven) have become a symbol for money laundering, tax evasion and tax fraud. Both the EU and the USA have been investing a lot to fight against tax havens (usually located in a heaven such as Bermuda, Bahamas, Seychelles, Mauritius etc). These words do not sound as bad when we test their meaning in the dictionary. According to Merriam-Webster dictionary haven is „a place offering favourable opportunities or conditions“, while a tax haven is „a place where people go to live and companies go to operate in order to avoid paying high taxes.“. Therefore a tax haven must be something good or positive.
Interestingly enough we have some arguments which show that Croatia is not only the heaven on Earth, but it could also be a tax haven. Furthermore, Croatia has relatively large double tax treaty network which even includes a double tax treaty with a tax haven - Mauritius. Consequently, we will give a short overview of the benefits of the Croatian tax system for individuals in a series of blogs.
No gifts tax and inheritance tax?
Many European countries heavily tax inheritance and gifts. Basic rule is: distant relative or no connection with the diseased, more tax to pay (in some countries up to 90% of the value of the inheritance or gift).
Croatia does not tax inheritance or gift of real estate located outside of Croatia. Direct descendants are not taxed in case they inherit or receive a gift of any type. All others are taxed with 3% (in case of real estate) and 4% in case of gifts.
There are certain exemptions and exemptions to the exemptions of the basic rule. Also even in case of exempted gits reporting is required.
We would be of course glad to get you through – should you have any inquiries please contact us.