CROATIA PEO & EOR
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DID YOU KNOW
- Croatia is home to one of the oldest cities in Europe – Split, which dates back over 1,700 years and was built around the palace of the Roman Emperor Diocletian.
- Dubrovnik, Croatia’s “Pearl of the Adriatic,” doubled as King’s Landing in HBO’s Game of Thrones, adding to the country’s global recognition and cultural cachet.
- Nikola Tesla, one of the greatest inventors in history and a pioneer in electricity, was born in what is now modern-day Croatia.
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Croatia PEO Services
A compelling, relaxing lifestyle and great weather
Both the Croatian mainland and its islands provide a compelling relaxing lifestyle, great weather, and a wealth of history to explore. A part of Yugoslavia until 1991, Croatia borders several countries including Slovenia, Serbia, Montenegro and more. Croatia has been a member of the European Union since 2013, and it enjoys similar perks to other European nations with a significantly lower cost of living.
Tourism is a key industry in Croatia, with its second largest city Split and the historical city of Dubrovnik being two growing tourism hotspots for visitors all around the globe.
Croatia is often considered a difficult country for foreign businesses and expats to get involved in. Fortunately, with the use of a Croatia PEO partner such as Gibson Watts Global, this process can be simplified and expedited significantly.
Working in Croatia
Financial Year Dates
Croatia’s financial year runs from January 1st to December 31st.
Minimum Wage
As of January 1, 2025, the gross minimum wage in Croatia is €970 per month.
Standard Working Hours
The standard full-time workweek, called puno radno vrijeme, in Croatia is 40 hours, typically distributed over five days from Monday to Friday. Working hours generally fall between 8 AM and 4 PM, including a lunch break.
Overtime
Overtime work may be required in cases of force majeure, a sudden increase in workload, or other comparable situations that necessitate urgent action. In such cases, the total working hours – including regular and overtime – must not exceed 50 hours per week.
The legal limit for overtime is 180 hours per year, but this can be extended to 250 hours annually if explicitly permitted by a collective agreement.
Holiday Allowance
Employees in Croatia are entitled to a minimum of four weeks (20 working days) of paid annual leave each year. This entitlement becomes effective after six months of continuous employment with the same employer. Employees with less than six months of service are entitled to a proportional amount of annual leave.
Sick Leave
Employees must inform their employer immediately in case of illness or injury and submit a medical certificate within three days confirming their inability to work.
Entitlements & Pay
Employees receive at least 70% of their average net salary (based on the previous six months) during sick leave. Many employers voluntarily cover the full salary, especially for short-term absences.
Who Pays?
- Employer: Covers the first 42 days of sick leave (or 7 days for employees with disabilities).
- Croatian Health Insurance Fund (HZZO): Covers sick leave beyond 42 days.
Maternity & Paternity Leave
Croatian law provides comprehensive maternity and parental benefits, including:
- Maternity Leave: Mandatory leave for mothers, duration depending on specific circumstances.
- Paternity Leave: Fathers are entitled to paternity leave, with specifics outlined in employment contracts or collective agreements.
- Parental Leave: Available to both parents, allowing them to care for their child during early years.
- Part-Time Work: Options for part-time work during maternity and parental leave periods.
- Breastfeeding Breaks: Provision for breaks to breastfeed during working hours.
- Prenatal Examination Leave: Employees can take time off for prenatal examinations in agreement with their employer.
Public Holidays
Croatia observes 14 public holidays annually, including:
- New Year’s Day (January 1)
- Epiphany (January 6)
- Easter Sunday & Easter Monday (dates vary)
- Labor Day (May 1)
- Statehood Day (May 30)
- Corpus Christi (date varies)
- Anti-Fascist Struggle Day (June 22)
- Victory and Homeland Thanksgiving Day (August 5)
- Assumption of Mary (August 15)
- All Saints’ Day (November 1)
- Remembrance Day (November 18)
- Christmas Day (December 25)
- St. Stephen’s Day (December 26)
Social Contributions
Croatia’s social security system includes pension and health insurance, with contributions shared between employees and employers.
Employee Contributions
Employees contribute 20% of their gross salary to pension insurance:
- 15% to the first pillar (state pension)
- 5% to the second pillar (mandatory private pension)
The contribution base depends on monthly gross salary:
- Up to EUR 700: Deduct EUR 300 from gross salary
- EUR 700.01–1,300: Deduct 0.5 × (1,300 – gross salary)
- Above EUR 1,300: Full gross salary is used, subject to 2024 caps:
- EUR 9,360/month (both pillars)
- EUR 112,320/year (first pillar only)
Employer Contributions
Employers pay 16.5% of gross salary for health insurance. This amount is uncapped.
Obligations for Hiring Disabled Persons
Employers with 20 or more employees must ensure that 3% of their workforce consists of persons with disabilities. If not met, a penalty of 20% of the minimum gross salary per required but unfilled position applies. For 2024, the minimum gross salary is EUR 840.
Income Tax
Croatia applies a progressive personal income tax system, with rates determined by both national thresholds and local government decisions.
Income from Employment, Self-Employment & Independent Work
- 15% to 23%: For annual income up to EUR 60,000 (EUR 5,000/month)
- 25% to 33%: For income exceeding EUR 60,000 annually
Note: If a local self-government unit has not set its own tax rates, the default national rates apply:
- 20% on income up to EUR 50,400 per year
- 30% on income above EUR 50,400 per year
Tax on Final Income
Certain types of income – such as rental income, capital gains, and other investment income – are subject to fixed rates of:
- 12%, 24%, or 36%, depending on the income category and amount
These rates are governed by the Croatian Income Tax Act.
Healthcare
Croatia offers a universal healthcare system funded through mandatory contributions from both employers and employees. Employers contribute 16.5% of the gross salary towards health insurance, while employees’ contributions are included in their pension payments. The Croatian Health Insurance Fund (HZZO) administers the public healthcare system, ensuring access to medical services for all insured individuals.
Visas
Croatia, as a member of the European Union and the Schengen Area, offers a structured visa regime that facilitates business mobility and international employment.
Short-Stay (Up to 90 Days):
- Citizens from countries with visa waiver agreements (e.g., the US, UK, Australia, Canada) can enter Croatia without a visa for stays up to 90 days within a 180-day period.
- Travelers from countries without such agreements (e.g., China, India) must obtain a Schengen visa prior to entry.
- All visitors must possess a passport valid for at least three months beyond their planned departure date from Croatia.
Long-Stay (Over 90 Days):
- For stays exceeding 90 days, individuals must apply for a national (Type D) visa, tailored to the purpose of their stay (e.g., work, study, family reunification).
Upcoming Changes (Effective 2026):
- Starting in 2026, travelers from visa-exempt countries will need to obtain an ETIAS (European Travel Information and Authorization System) authorization before entering Croatia or any other Schengen country.
- ETIAS is not a visa but a mandatory travel authorization, valid for three years or until the passport expires, whichever comes first.
13th Salary?
There is no legal requirement for a 13th salary in Croatia. However, many employers, especially in the private sector, may provide year-end bonuses or holiday bonuses, often around Christmas or in the summer, as part of a discretionary or performance-based incentive. These bonuses are subject to income tax and social contributions, unless otherwise exempt by law or collective agreement.
Cultural Information
Croatia, home to approximately 4 million people, is known for its rich cultural heritage, stunning Adriatic coastline, and exceptional quality of life. It is considered one of the safest countries in the world, making it an attractive destination for international businesses and expatriates alike.
The country’s population is predominantly Roman Catholic, though Orthodox Christian, Muslim, and Jewish communities are also present and contribute to Croatia’s diverse cultural landscape.
The official language is Croatian, a South Slavic language written in the Latin alphabet. However, English and German are widely spoken as second languages, especially in business and tourism sectors. Thanks to its Central European location, other regional languages such as Italian, Czech, and Hungarian are also commonly heard across the country.
Traditional Croatian culture is visible in everyday life – from folk music and dance (such as Klapa singing, a UNESCO-listed tradition) to vibrant local festivals that celebrate historical and religious heritage. The country is also famous for its culinary diversity, with regional dishes like pašticada, čevapi, and black risotto reflecting both coastal and continental tastes.
Why Choose Gibson Watts Global for EOR Services in Croatia?
Partnering with Gibson Watts Global as your Employer of Record in Croatia ensures full compliance with local employment laws while minimising the administrative burden of international hiring. Our in-country expertise allows us to manage everything from payroll processing and tax filing to HR support and legal compliance.
Whether you’re scaling operations into the EU, hiring remote talent, or establishing a project-based workforce, we provide a streamlined, risk-free solution to help you grow in Croatia with confidence.
Let Gibson Watts Global take care of the details, so you can focus on the bigger picture.