Property Taxes in Zagreb
Transfer tax, VAT on new builds, income tax on disposal and the annual property tax.
Taxes and fees often catch buyers and sellers by surprise because they do not show in the listing, yet they can significantly change the arithmetic. This guide by Hermes Nekretnine, based at Vlaška ulica 45 in Zagreb, explains which taxes and costs to plan for when buying, selling and owning property in Zagreb. The guide is informational and does not replace advice from a tax adviser or notary for your specific situation.
Real estate transfer tax is three per cent and is generally paid by the buyer. The base is the market value of the property at the time of acquisition, determined by the Tax Administration, and not necessarily the price from the contract if it differs significantly from the market. Filing is most often done through the notary who certifies the contract and submits it to the Tax Administration, and the tax is paid according to the decision within the period stated in it.
Transfer tax is not paid when buying a new property directly from a developer who is a VAT payer, because in that case VAT is included in the price. It is also not paid on acquisition of property by inheritance or gift between spouses and relatives in the direct line, nor when contributing property to a company as a stake. The exemption for buying a first property was abolished at the start of 2017, so first-time buyers today pay transfer tax at the same rate as everyone else.
When the contract is solemnised by a notary, they submit it electronically to the Tax Administration, so the transfer filing is generally handled. If the transfer did not go through a notary, the acquirer must file it themselves with the competent Tax Administration office within thirty days. After receiving the filing, the Tax Administration issues a decision on the assessed tax, which is paid within the period stated in the decision, usually within fifteen days of delivery.
When buying a new-build apartment from a developer who is a VAT payer, instead of transfer tax the price includes VAT at a rate of twenty-five per cent. For the buyer this means the tax burden is already contained in the stated price, but note that it applies to the entire value of the apartment, including the share of the land and common parts. In addition, a new build regularly involves the cost of fitting out, from the kitchen and flooring to built-in units.
While inheritance and gifts between spouses and relatives in the direct line are exempt from transfer tax, acquiring property by gift or inheritance outside that circle, for example between siblings or unrelated persons, generally attracts transfer tax of three per cent. Before accepting a gift of significant value it is useful to calculate the tax cost in advance.
If you sell a property within two years of acquiring it, the price difference achieved is taxed as income from property. The tax is not paid if the property served as housing for you or your dependents, if you acquired it by inheritance, or if the sale followed more than two years of ownership. A special case is frequent selling: if you dispose of several properties in a short period, this can be treated for tax purposes as carrying out a business activity, with different tax treatment. Before selling within the two-year period we recommend checking with a tax adviser.
From 2025 Croatia applies an annual property tax, which replaced the previous tax on holiday homes. The amount per square metre, within a range set by law, is determined by each city through its own decision, including the City of Zagreb. Properties where the owner has registered residence, as well as those given for long-term rent, are generally in a more favourable position or exempt, while vacant and occasionally used flats and holiday homes are taxed. Since city decisions can change from year to year, before buying check the current decision of the City of Zagreb and how it applies to your situation.
Alongside taxes, the budget should include the notary fee for certifying signatures and solemnising the contract, the court fee for registering the ownership right in the land registry and any cost of drafting the contract with a lawyer if the agency does not prepare it. For a purchase with a loan, the cost of the property valuation for the bank and the fee for processing the loan application are added.
The agency commission is agreed in the brokerage contract and depends on the type and value of the transaction and the scope of work. You receive the amount and everything it covers in a written offer before signing. An overview of what brokerage includes is on the buying consultation and seller representation pages.
The seller generally bears the cost of producing the energy certificate, which is required for every sale, and the agency commission if agreed. If a mortgage is registered on the property, the cost of removing it after the loan is repaid is added. In the case of a sale within the two-year period from acquisition, income tax on disposal may also arise, as discussed above. We arrange the energy certificate through energy certification.
For a resale apartment worth 200,000 euros, alongside the price the buyer should count on transfer tax of roughly 6,000 euros, notary and land registry costs in the order of a few hundred euros, the cost of the bank valuation and loan processing also a few hundred euros, and the agency commission per contract. Total additional costs in this example most often run between three and five per cent of the price, depending on the method of financing. With a cash purchase the bank valuation and processing fee fall away, so the share of additional costs is at the lower end of that range. With a new build, instead of transfer tax you pay VAT already included in the price, but the cost of fitting out follows, which for an average apartment can exceed the percentages in this example.
Real estate transfer tax of three per cent is generally paid by the buyer, except for a new build from a VAT payer, where VAT is included in the price.
No. That exemption was abolished at the start of 2017 and first-time buyers today pay transfer tax at the same rate as everyone else.
For a property acquired by inheritance, income tax on disposal is generally not paid, but check your specific case with a tax adviser.
The tax base is determined by the Tax Administration as the market value of the property at the time of acquisition, comparing it with prices of similar properties.
Properties with the owner's registered residence are generally in a more favourable position or exempt, but the final treatment depends on the current decision of the City of Zagreb.
In justified cases the Tax Administration can approve instalment payment of the tax debt on request. The terms and number of instalments depend on the amount and your situation.
Continue to all the guides, the first-time buyer guide, a property valuation and administrative and legal services.