Croatia’s new fiscalisation law takes effect from 2026: What you need to know

Croatia is preparing for a major leap in digitalising its business environment as a new Fiscalisation Law, often referred to as Fiscalisation 2.0, comes into force from 2026.

The reform brings mandatory e-Invoices for all businesses within the VAT system, streamlining processes while significantly reducing paperwork.

Authorities estimate the shift could save companies up to €120 million annually in administrative costs, largely due to the elimination of many traditional business forms and a move towards a fully digital reporting system.

Mandatory e-Invoices for VAT Payers

From 1 January 2026, all entrepreneurs and companies in the VAT system will be required to issue digital invoices.

The transition marks a major step in modernising business operations, but for many, it also raises questions.

Early reactions suggest concerns about increased effort and investment needed to adapt.

“Initially we all expect higher costs, more investment, and the need to engage people and new technologies,” Ivana Živković Abraham, director and owner of CFO Management, told HRT.

Accountants Enter a New Digital Era

Accountants will also feel the impact. Reporting to the Tax Administration will become faster and more demanding, with paper documents and emailed invoices becoming a thing of the past.

“We are moving into complete digitalisation. Everything will be in XML, everything in the Cloud,” explained Domagoj Bakran, co-founder and partner at Kreston Croatia.

As a result, physical folders and hard-copy documents will gradually disappear.

The move to cloud-based systems means businesses will require stronger technical and software support. Major Croatian institutions and companies have already developed tools to help with the transition.

Support from Fina, Croatian Post and HT

Fina has created a large technical testing environment where companies can verify that their accounting software is functioning correctly.

Croatian Post has introduced new eInvoice services under the name Sveračun, offering both prepaid packages and contract-based solutions for larger companies.

Croatian Telecom (HT) has designed a pay-per-use system in which costs decrease as businesses send more invoices. Current fees range between €0.27 and €0.40 per invoice, plus VAT.

Why the Change? Real-Time Oversight

The first wave of fiscalisation enabled the state to monitor cash transactions. Fiscalisation 2.0 extends that control to non-cash transactions.

The Tax Administration will be able to track inter-company transactions in real time, including who buys what, from whom, and at what price.

This transparency aims to reduce irregularities and strengthen oversight across the economy.

Government: “Everything Is Ready”

State Secretary at the Ministry of Finance, Tereza Rogić Lugarić, recently addressed concerns about the pace and scale of the reform.

Although the EU allows member states to delay similar changes until 2030, Croatia opted for early adoption.

“Our reporting system is outdated and lags behind transactions by up to four months,” she noted. “The infrastructure has long been in place, and there is no reason to wait.”

She emphasised that information intermediaries, which will play a key role in fiscalisation 2.0, are not new and already operate under strict regulations, ranging from cybersecurity standards to data protection laws.

Only the Method of Issuing Invoices Changes

Responding to concerns about potential misuse or false reporting, Rogić Lugarić stressed that fiscalisation is primarily a technical solution.

“The legal framework has simply been adjusted to digital invoicing. All existing rules on transactions continue to apply,” she said.

Costs vs. Benefits

Businesses will face some initial costs when adjusting internal processes and selecting service providers. However, the government highlights major long-term benefits: fewer administrative forms, improved accuracy, stronger control and considerable savings in time, paper and equipment.

“We believe this will significantly ease business operations and mark an important step forward in digitalisation,” Rogić Lugarić said.

The Finance Ministry is confident that companies will be prepared on time. More than 3,000 questions have already been answered through a dedicated Tax Administration portal.

“There is no reason for anyone not to be ready. All information is available, and everything will be prepared in time,” Rogić Lugarić said. “We believe no one will wake up on 31 December realising they are unprepared.”