We know, and all those who attended the last Split Startups Meetup of 2023 know, that the ladies from Kancelarija sure know how to work the tax and accounting magic.

For those who don’t, we even highlighted their work so you know they’re magicians in what they do!

We had no doubts about Zoja’s abilities to help untangle the tax and accounting tangles startup teams might struggle with during her fireside chat with Michael at the edition mentioned above of our Startups Meetup.

However, we do know that our limited time left some questions unanswered.

So, dear startups (and those who are thinking of initiating one), here is a series of questions you might have and we asked the Kancelarija team to answer on your behalf.

Read and learn from Kancelarija! 😀

What tax or accounting issues could happen during a crowdfunding campaign for a startup?

“Crowdfunding is a project financing method, so it does not impact your revenues or taxation. The question is what your investors want in exchange for financing it. There are different situations regarding taxation if investors get, for example, your products, interests, or capital shares.”

What are the taxes like in Croatia for an entrepreneur-freelancer who does not have a team?

“It depends on their tax status and whether they are self-employed in their firm or sole trader (obrt). Sole traders are better options for smaller businesses and freelancers because of lower and less complicated taxation.

But there is a catch: you must be aware of cash limits and other tax issues.

For example, you must avoid a situation where your sole trader business can be defined as covert employment in another company. If you are a self-employed business owner, you need to be aware of the director’s salary.”

Why having a good accountant and tax advisor is crucial to supporting your business?

“Specialists in taxes and accounting will help you start your business and support you while you grow. They will also save you time and resources, allowing you to focus on core business activities and guide you through all your accounting and tax questions.”

What should we pay attention to if our startup is ready to be bought out?

“You need to know how much money you can get for your business.

It is called a process of business valuation.

There are different approaches to the valuation process, so engage experts to help you establish your value and negotiate the best purchasing price. If you are a private person selling your capital shares, you need to pay attention to your personal tax.”

As a non-EU citizen, is it easier to start a startup in Croatia if you have a business partner from the EU and/or from Croatia?

“As a non-EU citizen, you’ll need to have a work permit to work in Croatia. EU citizens have no restrictions to work or start a business in Croatia. Still, everybody from abroad needs to pay attention to their tax residence.”

What are the most common tax and/or accounting mistakes startups do?

“The most common mistake is that startups engage experts after establishing a company and after setting up a tax status.

It is often too late to optimize their tax status or to set up their best tax option.”

Do you have any tax and/or accounting advice for a first-time startup founder/CEO?

“Before starting a business and registering it in Court, make sure that you know which business model and tax status you will choose. Also, inform yourself about subventions and financial models you can use as a startup.”

How much should an entrepreneur know about accounting? Do you think we can blindly trust an external expert like you with everything or do you think we should have a good understanding of what’s going on in the background?

“By becoming an entrepreneur, you should educate yourself about business, taxes, and accounting. After all, you are responsible for your business, not anyone else.

First, you should have an external expert that you can trust to lead you to make the correct business decision. As your business grows, you can have different needs for experts.

For example, you should also have basic law knowledge, but you will need a law expert to deal with contracts. Outsourcing of services will be essential in the future. You’ll need trustful experts to advise you in all fields of business.”

Generally speaking, do you think Croatia is a good place to initiate a startup company when it comes to tax perspective or not?

“There are a lot of Tax Law changes in Croatia, so there is no stability in tax planning. For example, at the end of 2023, Tax Reform was introduced and nine laws have been changed.

Planning taxes and costs in such an environment is very difficult.

In Kancelarija, we started a “Nemoj da te poreže” campaign in December 2023. We wanted to educate business owners on why a tax expert is essential for their business and why having a real-time review of financial statements is very important for their decision-making.

This year we will continue to educate entrepreneurs about tax and accounting topics so we would like to invite everyone to follow us on social media – Facebook and LinkedIn.”

If there are still questions you need answering – related to taxes and/or accounting – or if you need expert advice, make sure you reach out to Zoja, Dora, and the rest of the fantastic Kancelarija team.

You know where to find them! (Hint: their website, Facebook, and LinkedIn.) 😀