Larger Croatian Christmas Bonuses and Other Benefits on Horizon?

By 20 September 2022

September the 20th, 2022 - Could larger Croatian Christmas bonuses, gifts for children and other such benefits be on the horizon? The Ministry of Finance has a proposal which will interest many, especially during these difficult economic times fuelled by spiralling inflation and the fear of energy crises.

As Poslovni Dnevnik writes, last week, the Ministry of Finance submitted a proposal to amend the Income Tax Ordinance to increase the payment thresholds for six non-taxable items with which Croatian employers, in addition to paying out regular monthly wages, can further stimulate their staff, as tportal reports.

The limit for non-taxable occassional items, which include Croatian Christmas bonuses, holiday allowance and other such benefits, is being increased from 3,000 kuna to 5,000 kuna per year. The maximum amount of monetary rewards for work results and other forms of additional rewards for workers has also been increased from 5,000 kuna to 7,500 kuna per year.

For a gift to a child of an employee up to the age of fifteen, Croatian employers will be able to pay out 1,000 kuna per year tax free, whereas until now, the threshold stood at a considerably less 600 kuna.

The maximum non-taxable amount of monetary flat-rate compensation for meeting the costs of food for workers will rise from 5,000 kuna to 6,000 kuna per year, and the fee for using a private car for official purposes will rise from 2 kuna per kilometre to 3 kuna.

Future retirees can also expect higher net severance pay because the non-taxable portion of severance pay is now set to increase from 8,000 kuna to 10,000 kuna for each completed year of service.

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