Croatia tax: R&D tax incentive

Croatia – Under the Science Activity and High Education Act, a corporate income taxpayer that carries out qualifying research and development (R&D) projects can apply for an R&D tax incentive.

An R&D project for these purposes includes basic research, applied research and developmental research. Under the incentive, a company that obtains the approval of the competent authority is entitled to reduce its corporate income tax base by deducting 100%-150% of eligible R&D project expenditure, which will ultimately lead to a reduction in corporate income tax liability.