All prices that are advertised are the asking price of the relevant piece of real estate, unless otherwise stated. It is therefore important to make sure you have allowed for the costs of purchasing your property in Croatia, which includes the agency commission, legal fees and property tax. If you require a survey or consultation regarding planning regulations or other these would of course represent an additional cost. Please contact us for further information regarding the price of such services when purchasing property in Croatia.
First Agency Fees
First charges 3% + VAT (25% in Croatia) of the purchase price from the buyer. There is a minimum charge of 4000 Euros. Our terms and conditions are clearly laid out in our representation agreements which must be signed between First Property Croatia and the client prior to making a viewing trip.
Croatian Property Purchase Legal Fees
Solicitors fee vary, but on average they charge 1% + VAT which is in accordance with the regulations set out by the Ministry of Justice. For larger transactions we encourage our clients to work with lawyers who charge by the clock as it is often considerably cheaper, but does depend on the relevant transaction.
Croatian Real Estate Transfer Tax (RETT) & VAT
Stamp duty, property tax or locally know as Croatian real estate transfer tax (RETT) is 3% and paid by every buyer (domestic or foreign). The Tax application is sent by the lawyer within 30 days from the date of signing the sales / purchase contract and must be paid within 15 days from receiving the resolution from the Tax office. Any outstanding payments to the tax office incur 17% interest until settlement.
RETT is charged on the contractual sales price of the property, if a property is built before January 1, 1998 or is on sale by any entity that is outside of the VAT system.
RETT is charged on the value of land & infrastructure if a property is built after January 1, 1998 and the property is being sold by an entity that is within the VAT system.
Croatian properties that are built after January 1, 1998 are subject to 25% VAT which is calculated on the costs of the built portion of the property and is usually absorbed by the seller into the price. VAT can be refunded if the buyer is purchasing with an entity that is within the VAT system and the property is being used for commercial purposes.
It is extremely important to remember that if buying real estate in Croatia with a company and reclaiming VAT, that the company in question is going to generate income from the asset it has purchased and therefore justify it’s existance.
For details regarding the approximate costs of running a property in Croatia, please contact the Office.