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Flat-rate taxation – amendment of the rules


Two new amendments, one to the Personal Income Tax Act (ZDoh-2N) and another to the Corporate Income Tax Act (ZDDPO-2K), have entered into force, changing the method for determining the tax base by establishing flat-rate expenses, i.e. by increasing flat-rate expenses from 70% to 80%, and introducing a new category of taxable persons who may join the system.

Taxable persons whose revenue generated in the previous year did not exceed EUR 100,000 according to accounting rules may also decide to join the flat-rate taxation system from 1 January 2015 onward, provided that there was at least one person employed at the taxable person in the previous year covered by full-time compulsory insurance, i.e. for a period of at least five consecutive months in accordance with the regulations governing pension and disability insurance.

The amendments will apply from 1 January 2015 onward. Otherwise, the tax rates remain unchanged relative to 2014. However, due to the increase in flat-rate expenses, the tax base of the persons included in the flat-rate expense system will drop effectively, regardless of the actual volume of expenses, from the current 30% to 20% of revenues.

Notification of entry into the flat-rate taxation system must be submitted to the competent tax office by 31 March 2015.


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Saša Sodja