There is a sentence we hear in almost every first conversation with an owner who does not rent out: “None of that applies to me, the house is only for the family.”
For the duty to register it is not true, and for this levy it is not true either — in fact the opposite. The annual property tax that came into force on 1 January 2025 is aimed precisely at the house that stands empty for most of the year. Renting it out is not what triggers it. Not living there is.
What actually changed
Until the end of 2024 there was a holiday home tax, porez na kuće za odmor. It was levied per square metre, the rates were modest, and enforcement varied a great deal from one municipality to the next. Many owners never received a demand at all, and a good number concluded from that silence that they were not liable.
Since 1 January 2025 that tax no longer exists. In its place is a general property tax, porez na nekretnine, and it works from the opposite direction. The old tax asked whether a property was a holiday home. The new one asks whether it is somebody’s permanent home — and taxes everything that is not.
That change of logic is the whole story. A flat in Šibenik that has been empty for eleven years, a stone house on Brač used three weeks a summer, an apartment held as an investment and never occupied: under the old regime their treatment was arguable. Under the new one they fall in by default, and it is for the owner to show that an exemption applies.
Who is exempt — and who only thinks they are
Four exemptions matter for our clients. The first three are straightforward:
A property that is somebody’s registered permanent residence. Not “where I feel at home”, not “where I spend the summer” — the registered address, with the residence actually established there.
A property in which family members live. Same principle: someone genuinely lives there.
A property rented out long term, for at least ten months in the year. This is the one that gets misread most often, and the misreading is expensive. It means a residential tenancy, a tenant with their life in the property. It does not mean a good rental season. An apartment booked out from May to September has been rented out for five months, not ten, and remains fully taxable.
The fourth is different in kind, and we come back to it below: a building that cannot be used at all.
Notice what is missing from that list. There is no exemption for holiday rentals, none for a property that is furnished and ready, none for paying the tourist tax, and none for being a non-resident. Owners who rent out are not better placed here than owners who do not — they simply pay this on top of everything in part three of the eVisitor series.
“Uninhabitable” is not a matter of opinion
The exemption for buildings that cannot be used is the one owners reach for most readily and document least well. A roof that leaks in two places, no working bathroom, an old stone house half-way through a renovation that stalled — the owner is quite certain the house is not usable, and often they are right.
The difficulty is that certainty is not evidence. The exemption has to be claimed and supported, and the state of a building in March is not something anyone can establish in November. If your property may fall into this category, the useful thing is not an argument but a file: dated photographs of the actual defects, the disconnection notices for water and electricity if the services are off, correspondence with the builder, the record of the works.
This is one of the few places where our ordinary work has a direct financial value. Every inspection produces a report with photographs and a date on it. For a house in this condition that series of reports is exactly the documentation the claim needs — and it exists already, because we were going to write it anyway.
The rate: who sets it, and why your neighbour pays differently
The rate is set by the municipality or town, within a band laid down nationally of 0.60 to 8.00 euro per square metre of usable area per year. That is a factor of more than thirteen between the bottom and the top of the range, decided locally and revised locally.
It is worth being precise about which body decides what, because two levies are easily confused. The tourist tax is set by the county. The property tax is set by the municipality or town. A change in one says nothing about the other, and a neighbour twenty minutes along the coast can sit in a different municipality on a different rate for an identical house.
Rates are not fixed for good, either. A number of municipalities revised theirs upward for 2026, and any figure you were quoted when you bought is a figure from that year, not a standing one. If the annual cost of your property matters to your planning — and for most owners it does — the current decision of your own municipality is the only source worth relying on.
The part that catches foreign owners
The tax itself is rarely the problem. The letter is.
The liability is assessed by decision, and the decision goes to the address held on file for the property. For a great many foreign owners that address is the Croatian house — the empty one. The document arrives in Croatian, is put through the letterbox of a building nobody enters for four months, and sits there while the period for objecting to it runs out.
By the time the owner next opens the door, three things have happened at once. The deadline for disputing an error in the assessment — wrong floor area, an exemption not applied, the wrong owner after an inheritance — has passed. The payment is late. And interest has been running since a date nobody was aware of.
We have picked that letter up off the floor of a hallway more than once. It is the most avoidable piece of trouble in this whole area, and it has nothing to do with tax law. It is a question of whether post addressed to your property reaches you.
Three things prevent it, and none is complicated:
- Have post collected and read. Anything from the Porezna uprava or the municipality is opened and translated on the day it is found, not filed until the next visit.
- Check the floor area on the assessment against the reality. The area the tax is calculated on comes from municipal records that were often compiled for utility charges, and errors in them are not rare. Balconies, garages and unconverted lofts are the usual points of dispute.
- Keep the ownership record current. After an inheritance or a transfer, an assessment addressed to the previous owner is still an assessment. It does not go away because the name on it is wrong.
What to check this year
If you own a property on the coast that is not somebody’s permanent residence, four questions are worth answering before the winter:
Do I know the current rate in my municipality? Not the national band, not what the agent said in 2023 — the decision now in force where the house stands.
Is the area they are taxing the right one? Compare the square metres on the assessment with your title documents.
Am I relying on an exemption I could not evidence? If the answer rests on the building being unusable, the file needs to exist before anyone asks for it.
Does post sent to the property reach me within days? If it does not, this levy is not the only thing that will go wrong — it is simply the one that costs money first.
How we handle it
For clients under contract we empty the letterbox on every visit, and anything from the tax administration, the municipality or the tourist board is photographed and sent on the same day, with a translation of what it says and what deadline it carries. That is part of authorities and post, not an extra.
Where a property genuinely cannot be used, our inspection reports form the dated record of its condition, and we will put that series together for whoever is handling the claim.
What we do not do is give tax advice, calculate your liability, or deal with the tax administration on your behalf. That is work for a Croatian tax adviser, and we will introduce you to one from our network without taking a commission. Our part is narrower and, in our experience, the part that actually goes wrong: making sure the letter is read while there is still time to act on it.
This article describes in general terms the annual property tax (porez na nekretnine) in force in Croatia since 1 January 2025, which replaced the earlier holiday home tax. It is not legal or tax advice. Rates are set by each municipality or town within the statutory band and are revised periodically; what governs is the decision currently in force in the municipality where your property lies, together with the assessment issued to you. For your own position we refer you to an independent Croatian tax adviser, without taking a commission.