The annual income from home crafting or supplementary occupations is limited and must not exceed ten times the average gross salary in Croatia for the previous year. Anyone exceeding this limit loses the right to work approval.
Written by: mr. sc. Marija Zuber, advisor-editor at the magazine Accounting and Finance
[email protected]
After almost 14 years, the possibility for individuals to engage in activities that previously required the establishment of a craft has been legally framed again this summer. Namely, with the Law on Amendments to the Crafts Act, which came into force on July 10, it is once again possible to perform home crafting and supplementary occupations as a special form of conducting craft activities. Home crafting and supplementary occupations are not new legal institutes. They were known from previous regulations on conducting independent activities through personal labor, but were abolished in 1993. Their reintroduction into legal frameworks will enable those who are already employed as well as those who are retired to access additional sources of income.
Only items from the product list
In home crafting, or at home, only items from a special product list, which is issued by the minister responsible for economy, labor, and entrepreneurship, at the proposal of the Croatian Chamber of Trades and Crafts, may be produced. The product list must be adopted within three months from the entry into force of the Law on Amendments to the Crafts Act, no later than October 10. Only after that will interested parties be able to submit an application to the competent office of the state administration for economic affairs, or the City of Zagreb office, for the performance of home crafting, in which they must specify the products they will produce.
It is reasonable to assume that the product list that can be produced in home crafting will include those whose production does not require special health protection measures, special sanitary and other conditions, and does not require that the work be performed in premises that must meet certain prescribed minimum technical standards. Examples of such products include the making of jewelry, souvenirs, basket weaving, and other products made of straw and rush, making hats, and perhaps some other clothing items. It is certain that once the product list that can be produced in home crafting is adopted, it does not have to be final and can be supplemented according to demonstrated interest, which should be overseen by the Croatian Chamber of Trades and Crafts.
Conditions and expertise for supplementary occupations
Supplementary occupations are defined as the performance of certain maintenance and repair services, and the list of services that can be performed as supplementary occupations will also be adopted by the competent minister within three months. However, unlike home crafting, for which no educational qualifications are required, for the performance of supplementary occupations, depending on the activity being reported, specific conditions must be met. The list of services that can be performed as supplementary occupations will likely include clothing alteration services, shoemaking services, minor repairs in apartments, apartment cleaning, stairwell cleaning, jewelry repair, garden maintenance, and yard landscaping, etc. There were expectations that bookkeeping services for entrepreneurs could also be performed as supplementary occupations, but this does not arise from the provisions of the amended Crafts Act.
Individuals interested in performing home crafting or supplementary occupations must apply at the county office for economic affairs or the City of Zagreb office, with a request for the issuance of the appropriate approval. If they meet the required conditions, the competent office will issue a written approval, but will not issue a craft license, as a craft license is only issued to individuals establishing a craft. Issued approvals will be kept in a special registry that will be established by the competent state administration offices. A copy of the issued approval will be sent to the Tax Administration, so that the obligation to pay public dues can be determined and monitored.
Three limitations
Limitations for performing home crafting and supplementary occupations can be conditionally categorized into three groups. The first limitation is the product list and the list of services that can be performed based on the issued approval. The second limitation relates to the income that can be generated from such activities in a calendar year. Total receipts from home crafting or supplementary occupations in one year must not exceed ten times the average gross salary earned in Croatia during the period from January to August of the previous year. For orientation, we provide the data on the average gross salary from January to August 2006, which would be the criterion for this year if it had been possible to perform home crafting or supplementary occupations from the beginning of the year. According to this data, the total annual income should not exceed 65,650 HRK.
