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Moving to Croatia - UK Pensions + Double Tax Treaty

wiltshire
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Moving to Croatia - UK Pensions + Double Tax Treaty
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I've just searched for the following on Croatia Forums and can't find it. So apologies if it is listed under another heading. That said, my family and I are moving to Croatia next year and would appreciate any advice about UK Pensions and the 'Double Tax Treaty'.

For example, I can have my UK Pensions paid into a Croatian Bank but on average this costs £20 per mandate. So I was wondering if it was better having my pensions paid into a UK Bank (Metro Bank?) that doesn't charge for ATM withdrawals in Croatia.

Further to the above, will I get charged Tax on my UK Pensions by both UK and Croatia. I've read this should not happen under the 'Double Tax Treaty' between UK and Croatia. Although I would be v grateful if someone could confirm this is true in practice.

Any advice would be greatly appreciated.

Europe
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1. Re: Moving to Croatia - UK Pensions + Double Tax Treaty
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I doubt anyone here is financial advisor. You will need to ask some tax advisors in Croatia.

What I can tell you from my work experience UK tax system is much more simple than Croatian.

I would just keep geting my pension in the UK and use UK bank card in Croatia - but that is my opinion and probably not under the rules but I dont see the way anyone knowing where you live while UK is still member of the EU.

To open account in Croatia you have to provide OIB (similar to NI number in the UK). You can get one as you are EU national. Croatain banks have a duty to inform tax department about your earnings.

But keep in mind that Croatia will be happy to tax your income.

There are alot of stories in newspapers of Croatians going to Ireland to work and than Croatia tax their income as it was earned in Croatia. Also Croatian taxes as much more higher than the UK ones.

Edited: 5 years ago
Zagreb, Croatia
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2. Re: Moving to Croatia - UK Pensions + Double Tax Treaty
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You'd best be moving here before March 2019, when Brexit kicks in, because it'll be extremely difficult to do so afterward.

United Kingdom
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3. Re: Moving to Croatia - UK Pensions + Double Tax Treaty
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You need to speak to a tax adviser to go through this properly and understand the rules.

In essence, as a uk resident you will pay uk tax regardless of where you are living. I don't know anything about Croation tax but suspect they will have a similar set up where if you meet certain residency criteria you will be liable to tax there on your worldwide income. Some countries also tax money which is earned abroad if it is brought into the country, even if you would not satisfy the residency requirements to be liable to tax on offshore income.

The objective of a DTT is to avoid double or non-taxation. But that it not always how they work and, in any event, you will need to understand which country has the right to the tax and what your obligations are around reporting any payment.

It's potentially quite complex I'm afraid so I would seriously recommend taking advice, and not relying on what you may be told online by people who do not know the details and are probably not qualified to advise.

wiltshire
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4. Re: Moving to Croatia - UK Pensions + Double Tax Treaty
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All,

thank you for the messages and all the useful information, much appreciated.. I was surprised that I couldn't find this (Pensions/DTT) listed before. As I believed I would not be the only one dealing with these issues. That said, it looks like I'll be contacting a Tax adviser and completing residency documentation before Brexit. Thank you again for all your help.

Kind Regards

Chester, United...
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434 posts
5. Re: Moving to Croatia - UK Pensions + Double Tax Treaty
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We have a First Direct internet bank account, my pension ect is payed in then I transfer whatever the amount we need to our Croatian bank account in sterling. This costs nothing as sterling international transfers are free, I currently get an average exchange rate of £1 = 8.16 kuna. All of our income is taxed in the UK. We complete our move to Split 02/10/2018

wiltshire
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6. Re: Moving to Croatia - UK Pensions + Double Tax Treaty
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Dear Marina, thank you for the email and information. As this is very similar to what I've been thinking of doing. The only difference was I planned was to have my pensions paid into a UK bank that doesn't charge for overseas withdrawals from ATMs, then take money from the ATM when we need it. Although, my worry was that my pensions would be taxed in the UK and again in Croatia. Ie: The 'Double Tax Treaty' I've hearing about. However as it is obviously working for you, it looks like this is what we will be doing too. :) Thanks again for the email and apologies for not replying sooner but I was working away from home with no internet access.

Kind Regards

7. Re: Moving to Croatia - UK Pensions + Double Tax Treaty

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