Renting out a Croatian villa

[Martin Westby]

Hello Peter,
Something keeps coming up and I wondered whether you or visitors to your site could help.
Once you have bought in Croatia a lot of people quickly want to rent it out.
Agents say "it was not possible to rent property as an individual, but had to be done through a company"
Is the distinction here that if you wish to let to tourists in Croatia direct then you must be a trading croatian company-however there is nothing stopping you if you wish to start your own website and generate income in the UK and pay tax on it there-without the need for a company?
Is any of this effected whether your initial sale is via a pre contract or company?
Thanks in advance for your thoughts

[Peter Ellis]

The simplest way is to do it through a local letting agent. We work with several reliable ones in Istria.
The company thing is probably for registration purposes but since the letting agents will collect the tourist tax and pay the other taxes, there is no reason that we are aware of why private owners cannot use this method, without needing to set up a company. We have been introducing buyers directly to the letting agents and they deal with bookings for them throughout the 'season'.
Anyone renting out for the rest of the year directly from the UK could probably do so, but they would be better just doing the advertising and bookings and paying the local agent to still manage the clients in and out and collect the tourist tax when they welcome them.
Getting clients from UK advertising to pay them for the rental in the UK is an option and there is double taxation between the UK and Croatia but on specific tax issues they would be better taking advice from a local accountant. We can introduce them to a good English speaking one who already works with British companies.