HAVING A TRADE WHILE
BEING EMPLOYMENT
If you are a craftsman (regardless of how you pay taxes, lump sum or not), you can be employed
elsewhere.
It does not matter whether you are employed under a fixed-term contract or an indefinite contract
or a
contract for additional employment.
In fact, in addition to crafts, you can be employed full-time by one employer and additionally on
additional work by another employer.
"When a person who has a trade is at the same time employed by the employer, then the
performance of
the activity of a trade is considered
other activity. "( Art. 7 item 6 of the
Law on Contributions )
1. How do you pay income tax?
When you are employed by an employer and at the same time perform a craft activity, income
tax
is paid in the same way as when you are not employed by the employer,
that is, when you work only in crafts.
Tax amounts are calculated based on the tax class you belong to according to your annual
income. There are 5 tax classes, listed in the table below
( Table 1). Thus, for example, if the annual income is HRK 100,000.00, you pay tax in
accordance with the second tax class (From 85,000.01 to 115,000.00).
The monthly tax in this case is HRK 143.75; whereby this amount is additionally calculated
and
surtaxed at the rate valid for the place of residence.
Note that, when opening a trade during the year, you must calculate the average monthly
income
which you then multiply by the number 12 (number of months in the year)
to receive the annual income on the basis of which the affiliation to the tax class is
determined.
This also applies to seasonal trades that work for 6 months, for example. If you open a
lump-sum
trade as a seasonal trade (6 months) then if you put HRK 84,000.00 in the RPO; be
you will put in the 4th tax class because you have achieved an average annual income of HRK
168,000.00.
Income tax amounts are paid depending on which tax class you belong to, and
according to the amounts in the table below:
Annual Receipts
Annual Base
Monthly income tax
(excluding surtax)
Annual income tax
(excluding surtax)
Annual tax with
surtax
(ex. Zagreb)
Od 0,00 do 85.000,00
12.750,00
106,25
1.275,00
1.504,5
Od 85.000,01 do 115.000,00
17.250,00
143,75
1.725,00
2.035,50
Od 115.000.01 do 149.500,00
22.425,00
186,88
2.242,50
2.646,15
Od 149.500,01 do 230.000,00
34.500,00
287,5
3.450,00
4071,00
Od 230.000,01 do 300.000,00
45.000,00
375,00
4.500,00
5.310,00
When you are employed elsewhere, you do not pay contributions in the same way as when you
are
employed only in a trade.
The amounts of contributions in this case depend on the annual receipts in the trade. For
example, if you have received receipts
less than HRK 85,000.00 per year, then you pay contributions according to the annual basis
of
HRK 12,750.00. On the stated basis
7.5% is paid for pension I pillar, 2.5% for pension II pillar and 7.5% for health insurance.
If you are a craftsman (regardless of how you pay taxes, lump sum or not), you can be employed elsewhere. It does not matter whether you are employed under a fixed-term contract or an indefinite contract or a contract for additional employment. In fact, in addition to crafts, you can be employed full-time by one employer and additionally on additional work by another employer.
"When a person who has a trade is at the same time employed by the employer, then the performance of the activity of a trade is considered other activity. "( Art. 7 item 6 of the Law on Contributions )
1. How do you pay income tax?
When you are employed by an employer and at the same time perform a craft activity, income tax is paid in the same way as when you are not employed by the employer, that is, when you work only in crafts.
Tax amounts are calculated based on the tax class you belong to according to your annual income. There are 5 tax classes, listed in the table below ( Table 1). Thus, for example, if the annual income is HRK 100,000.00, you pay tax in accordance with the second tax class (From 85,000.01 to 115,000.00). The monthly tax in this case is HRK 143.75; whereby this amount is additionally calculated and surtaxed at the rate valid for the place of residence.
Note that, when opening a trade during the year, you must calculate the average monthly income which you then multiply by the number 12 (number of months in the year) to receive the annual income on the basis of which the affiliation to the tax class is determined.
This also applies to seasonal trades that work for 6 months, for example. If you open a lump-sum trade as a seasonal trade (6 months) then if you put HRK 84,000.00 in the RPO; be you will put in the 4th tax class because you have achieved an average annual income of HRK 168,000.00.
Income tax amounts are paid depending on which tax class you belong to, and according to the amounts in the table below:
| Annual Receipts | Annual Base | Monthly income tax (excluding surtax) |
Annual income tax (excluding surtax) |
Annual tax with surtax (ex. Zagreb) |
|---|---|---|---|---|
| Od 0,00 do 85.000,00 | 12.750,00 | 106,25 | 1.275,00 | 1.504,5 |
| Od 85.000,01 do 115.000,00 | 17.250,00 | 143,75 | 1.725,00 | 2.035,50 |
| Od 115.000.01 do 149.500,00 | 22.425,00 | 186,88 | 2.242,50 | 2.646,15 |
| Od 149.500,01 do 230.000,00 | 34.500,00 | 287,5 | 3.450,00 | 4071,00 |
| Od 230.000,01 do 300.000,00 | 45.000,00 | 375,00 | 4.500,00 | 5.310,00 |
When you are employed elsewhere, you do not pay contributions in the same way as when you are employed only in a trade. The amounts of contributions in this case depend on the annual receipts in the trade. For example, if you have received receipts less than HRK 85,000.00 per year, then you pay contributions according to the annual basis of HRK 12,750.00. On the stated basis 7.5% is paid for pension I pillar, 2.5% for pension II pillar and 7.5% for health insurance.
2. How are contributions paid?
The table below lists the amounts that are valid when you perform the activity of a trade throughout the year as well you are also employed by the employer.
| Annual Receipts | Annual Base | Pension Insurance | Health Insurance | Annual amount |
|---|---|---|---|---|
| from 0,00 to 85.000,00 | 12.750,00 | 1.275,00 | 956,25 | 2.231,25 |
| from 85.000,01 to 115.000,00 | 17.250,00 | 1.725,00 | 1.293,75 | 3.018,75 |
| from 115.000.01 to 149.500,00 | 22.425,00 | 2.242,50 | 1.681,88 | 3.924,38 |
| from 149.500,01 to 230.000,00 | 34.500,00 | 3.450,00 | 2.587,50 | 6.037,50 |
| from 230.000,01 to 300.000,00 | 45.000,00 | 4.500,00 | 3.375,00 | 7.875,00 |
What if you run a business as another business for only part of the year?
We will explain the calculation of your contribution obligation if you are employed elsewhere in 2 steps:
2.1. What are your average earnings?
Suppose you are employed by an employer and have decided to open your own lump sum business. The craft opened on May 14th. Until the end of you you made receipts in the amount of HRK 50,000.00.
First, the average income is calculated by dividing the amount of HRK 50,000.00 by the number of months from the opening of the trade until the end of the year (if the trade is open until the end of the year).
When calculating the number of months, Article 186 of the Law on Contributions is taken into account. according to which:
"In the number of months of performing other account activity is every full month of other activity increased by last month , regardless of the number of days of performance other activities in that month and without reduction for months in which the activity is temporarily suspended and the months in which the temporary right was exercised incapacity for work. "
"Exceptionally, in the number of months of performing another activity to the contributor who from that activity pays income tax according to a lump sum income the period in which it is temporarily suspended shall not be taken performing other activities, in accordance with the regulation about trades. "
Since the trade is open in May, we count the number of months from June (the first following full month).
Considering that there are 7 months left until the end of the year (from 01.06. To 31.12.); 50,000.00 is divided by the number 7, which gives the amount of HRK 7,142.86. The amount obtained is the average the monthly income which is then multiplied by 12 to obtain the annual income on the basis of which the tax bracket is determined.
2.2. Which tax bracket do you belong to according to average receipts?
In this case, the annual income was HRK 85,714.29 which means that according to the average you belong to the second tax class.
| Income class | Amount |
|---|---|
| 1 | from 0,00 to 85.000,00 |
| 2 | from 85.000,01 to 115.000,00 |
| 3 | from 115.000.01 to 149.500,00 |
| 4 | from 149.500,01 to 230.000,00 |
| 5 | from 230.000,01 to 300.000,00 |
What are your annual receipts?
Your annual income is:
Your contribution obligation is (pension + health insurance):