Your company is established in Croatia, you have passed 10,000 euro in annual sales to consumers in other member states, and your VAT no longer goes to the Croatian Tax Administration (Porezna uprava) but to the tax authorities of the countries where your customers live. The law gives you two options: register for OSS and handle everything with one return filed from Croatia, or register for VAT in each member state separately. The decision is not purely administrative, because OSS does not cover every supply.
Short answer
- The threshold is 10,000.00 euro, calculated cumulatively across the entire EU, net of VAT, covering intra-EU distance sales of goods and telecommunications, broadcasting and electronically supplied services together (Article 26.a of the Croatian VAT Act, Zakon o PDV-u).
- Below the threshold you charge Croatian VAT. Once you cross it, the place of taxation moves to the customer's country, starting with that very supply.
- OSS (One Stop Shop) in Croatia in 2026 means one quarterly return and one payment in euro, which Porezna uprava then distributes to the member states of consumption.
- OSS is an option, not an obligation. If you do not choose it, you must register for VAT in every country where your supplies are taxed.
- OSS does not cover supplies to taxable persons, goods you assemble or install, new means of transport, or supplies made out of a warehouse located in another member state.
When do you actually have a choice: the 10,000 euro threshold
The threshold applies if you have your seat, residence or habitual residence in Croatia and if the total value of your supplies to non-taxable persons in other member states, net of VAT, was not above 10,000.00 euro in the current calendar year and was not above it in the previous one.
The operative word is "total". It is one pooled figure for all member states and it mixes goods and digital services. Sales of 6,000 euro to Slovenia and 5,000 euro to Austria mean you have crossed the threshold, even though you are nowhere near it in either country on its own. There is no per-country allowance.
The obligation starts immediately, with the supply that took you over, not from the beginning of the next year. On top of that, within **8 days** of that supply you file the Obrazac e-trgovina (the e-commerce reporting form Porezna uprava uses to monitor the threshold). If you stay below the threshold, you file the same form once a year, by the end of January for the previous year. That deadline was extended from 20 January with effect from 31 January 2026 (Pravilnik o PDV-u, the VAT implementing ordinance, Article 163).
You may also choose to be taxed in the customer's country before you cross the threshold, but that choice binds you for two calendar years.
Option 1: OSS, one return for the whole EU
The Union scheme is set out in Articles 125.a to 125.h of the VAT Act. You register electronically with Porezna uprava and use the Croatian VAT identification number you already have. No new number, no fiscal representative abroad.
- Filing and payment: for each calendar quarter, by the last day of the month following the end of that quarter, and also for quarters with no supplies at all. Amounts are reported and VAT is paid in euro.
- When it starts to apply: from the first day of the following quarter, and from the date of your first supply only if you notify Porezna uprava by the 10th day of the month after that supply (Council Implementing Regulation (EU) 282/2011, Article 57d).
- All or nothing: the scheme applies to all goods and all services you supply in the EU. You cannot use OSS for goods only.
- Invoicing: for intra-EU distance sales of goods under OSS you are not required to issue an invoice (Article 78, paragraph 1, item 2).
- Input VAT: you have no right of deduction in the member state of consumption. VAT paid there is recovered through the refund procedure instead, which is slower.
- Corrections and records: errors go into the next return, within three years. Records are kept for 10 years from the end of the year in which the transactions took place.
One warning that is rarely mentioned. Being excluded for persistent failure to comply with the rules of the scheme means you cannot use any of the special schemes, in any member state, for two years (Regulation 282/2011, Article 58b).
Option 2: VAT registration in every member state
If you do not opt for OSS, you must register for VAT in every member state where your supplies are taxed. That means a local VAT number, local returns on local deadlines and, in most countries, a local accountant. For three markets, that is three parallel reporting systems.
Local registration makes sense when it is mandatory, or when you incur significant local input VAT that you would rather deduct on a local return than reclaim through the refund procedure.
Situations where OSS is not enough
- Supplies to taxable persons. By definition, intra-EU distance selling covers supplies to non-taxable persons. B2B supplies are outside OSS and do not count towards the threshold.
- A warehouse in another member state. A supply from a warehouse in Germany to a German customer is not a distance sale, because the transport does not begin in another member state. It is a domestic supply in Germany and it requires a German VAT number, as does simply moving your own stock into that warehouse.
- Goods that are assembled or installed i new means of transport. The VAT Act expressly excludes both from the definition of distance selling.
Option 3: the cross-border exemption for small taxable persons
Since 1 January 2025 there is a route most articles about OSS skip. A taxable person established in Croatia can submit a prior notification to Porezna uprava and receive an individual identification number, which is their OIB (the Croatian identification number) with the suffix EX. With it, they apply a VAT exemption in other member states instead of charging local VAT there.
- Annual turnover in the Union of no more than 100,000.00 euro, provided you also stay below the national threshold of the country where you apply the exemption.
- Porezna uprava assigns the number within 35 working days of receiving the notification.
- You file a quarterly report of supply values by member state, in euro, within one month of the end of the quarter.
- You report crossing the threshold within 15 working days, the exemption stops from that moment, and the EX number is withdrawn as of the date you crossed it.
This scheme does not affect your status in Croatia, where the threshold for mandatory entry into the VAT register is 60,000.00 euro in 2026 as well.
A worked example
A webshop based in Rijeka makes 45,000 euro in sales to consumers in Slovenia, Austria and Germany during 2026, shipping everything from its warehouse in Rijeka. It crossed the threshold in April, filed the Obrazac e-trgovina within 8 days and registered for OSS. For the second quarter it files one return by 31 July and, with a single payment in euro, settles Slovenian, Austrian and German VAT at each country's rates.
Change one detail and the picture changes. If the same webshop keeps part of its stock in a warehouse in Germany and supplies German customers from it, those supplies are not distance sales. They require a German VAT number and German returns, while OSS covers only the goods dispatched from Croatia. Two systems in parallel, not one.
What you need to do
1. Calculate the combined value of your supplies to EU consumers for the current and previous year, net of VAT, goods and services together.
2. Below the threshold, file the Obrazac e-trgovina by the end of January for the previous year. If you cross it, file within 8 days of that supply.
3. Choose between OSS, local registrations and, if you are under 100,000 euro of turnover in the Union, the cross-border exemption.
4. If you choose OSS, register by the 10th day of the month after your first supply. Miss that deadline and OSS applies only from the first day of the next quarter, leaving the supplies in between to be handled locally.
5. Check whether you hold stock in another member state or make supplies with installation. If you do, plan a local registration alongside OSS.
6. Configure destination-country VAT rates in your webshop, plus records broken down by member state of consumption.
Frequently asked questions
Do sales to companies count towards the 10,000 euro threshold?
No. Intra-EU distance selling covers supplies to non-taxable persons. B2B supplies neither count towards the threshold nor get reported through OSS.
Can I use OSS for digital services only and report goods locally?
You cannot. The scheme applies to all goods and services you supply in the European Union (Article 125.b, paragraph 2 of the VAT Act).
What if my stock sits in an Amazon warehouse in Germany?
Supplies from that warehouse to German customers are domestic supplies in Germany and require a German VAT number. Supplies from the same warehouse to customers in other member states can go through OSS.
If you sell to consumers in the EU and you are not sure whether you have crossed the threshold or whether OSS is enough for you, I will review your supplies by country and propose the right procedure. Book a consultation.
This text is for information only and does not constitute tax or legal advice. For your specific case, please consult your accountant.