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6.3. Depreciation and Amortization

When calculating Croatian taxable income, both tangible and intangible assets owned by an enterprise must be depreciated over their normal useful life using the straight-line method. Generally, assets with an acquisition cost of HRK 3,500 or less, or with a useful of life of 1 year or less, are fully written off in the year of purchase.

The following are the maximum applicable rates for various asset types.

Buildings and ships of over 1,000 gross registered tonnage 5%
Plant, machinery and equipment5% / 20% / 25% / 50%
Personal motor vehicles 20%
Non-Personal motor vehicles 25%
Computers, computer hardware and software 50%
Intangible assets 25%
Other fixed assets 10%

Allowed Depreciation Deductions

The amount of tax depreciation deducted in a particular period may not exceed the amount of accounting depreciation in that period.  In the event tax depreciation exceeds accounting depreciation, the excess must be carried forward for deduction in future periods.

The depreciation of any assets not used in the course of normal business activities is not deductible.