Insights
Payroll in Croatia: Contributions, Municipal Tax Rates and JOPPD
Insights · By Chen ChunJie · Published 8 November 2026
Croatian payroll is straightforward for employers but detailed for employees: pension comes out of gross pay, and income tax depends on where the employee lives. This guide sets out the 2026 rates and a worked example.
Last reviewed in November 2026 against the Labour Act, the 2026 minimum wage decree, the Contributions Act and Tax Administration guidance. Rates change, so we confirm them for each engagement.
Contributions in 2026
| Item | Employer | Employee |
|---|---|---|
| Health insurance | 16.5% | None |
| Pension Pillar I | None | 15% |
| Pension Pillar II | None | 5% |
Pension contributions stop at an annual maximum base, and gross pay up to EUR 1,300 a month gets a reduced Pillar I base.
Income tax
| Annual taxable income | Municipal rate range |
|---|---|
| Up to EUR 60,000 | 15% to 23% |
| Above EUR 60,000 | 25% to 33% |
A personal allowance of EUR 600 a month applies before tax. Workers up to 25 are exempt and those aged 26 to 30 pay half. Tax and contributions are reported on a JOPPD with each payment.
Have a Croatian company and want payroll run every month? See Payroll Outsourcing in Croatia.
Worked example: EUR 2,500 a month in Zagreb
| Line | EUR a month |
|---|---|
| Gross salary | 2,500.00 |
| Pension contributions (20%) | 500.00 |
| Income tax (23% on EUR 1,400 after the allowance) | 322.00 |
| Net pay | 1,678.00 |
| Employer health contribution (16.5%) | 412.50 |
| Total employer cost | 2,912.50 |
The example assumes Zagreb’s lower rate of 23% and no other deductions. Try other salaries in our Croatia salary calculator.
Bonuses and allowances
Christmas bonuses, holiday allowance (regres) and some allowances can be paid tax-free up to set limits. They are owed only if the contract, work rules or a collective agreement provides for them.
FAQ: payroll in Croatia
What does the employer pay?
16.5% health insurance on gross pay.
What does the employee pay?
20% pension plus income tax at the municipal rate.
What is the JOPPD?
The report of pay, contributions and tax filed with each payment.
Are young workers taxed?
Workers up to 25 are exempt, and those aged 26 to 30 pay half.
Hiring your first employee in Croatia?
Our Local Team employs the person, runs payroll with contributions, income tax and JOPPD, and handles the paperwork, while you manage the day-to-day work.
Related
How we employ your team in Croatia.
Contracts, leave, termination and more.