The Thorny Path of Entrepreneurs Begins with Opening a Business

I was entitled to benefits for a full 360 days, but I lasted 4 months. I went to my caseworker and said that I wanted to open a sole proprietorship. A sole proprietorship? What is that? Am I normal?!

Until mid-2012, I worked in a media company that was heading in a direction I did not like. I ended up on the unemployment register. I was entitled to benefits for a full 360 days, but I lasted four months. I went to my caseworker and said that I wanted to open a sole proprietorship. A sole proprietorship? What is that? Am I normal?!

– You know, ma’am, you still have the right to receive benefits for another eight months, my caseworker tells me.
– I know, I say, and add that I cannot live on 2,000 kuna and that I am not someone who will work illegally and “collect” money from the state.

Simply put, I decided to become an entrepreneur.

– But think about it. This is a big risk for you, you will lose your right to benefits, and you see what times we live in, he says.

Yes, I think, but I know I can, and moreover, I want to. However, he does not let me deregister from unemployment.

I no longer want to waste time on him, so I go to the accountant recommended by my former colleague to advise me on how to open a sole proprietorship and to resolve whether this is for me in a conversation with him. I ran a company, I know how things work, and I knew that at the beginning I would not be able to secure the initial capital and all the contributions for the first year of operation that a limited liability company must pay. And I am not inclined to borrowing either. The accountant explains everything nicely and warns me that it will not be easy to go through all the steps, but that I must be persistent and not let myself be “driven around”.

The first step – I submit the RPO form (register of taxpayers) to the tax administration and wait for it to be certified. I make a stamp and go to the pension fund where I am greeted by a wonderful lady who not only has heard of sole proprietorships but also helped me mentally prepare for everything that follows.
We agree that I will perform the activity of a business consultant, among a pile of outdated names from probably 1955. That’s it – I am on the right path. She puts a stamp in my work book (this is before Croatia joined the EU, so we still used it) and sends me to the Health Insurance Institute. There, I wait in one line, then in another, third, and finally go to the 3rd floor – I arrive at the right place. I manage to register with HZZO.

The next stop – opening a business account at the bank. The accountant warned me that they would not want to open an account for me unless I am a member of an association that will assign me a registration number. I join the association, pay the membership fee, receive the registration number, and go to the bank to meet with my personal banker.

– You opened what??? Please give me an excerpt from the commercial court or a trade license, says the bank employee.

– No, sir, I have neither, I opened a sole proprietorship and I have the RPO form. The tax administration is responsible for freelance professions, I say.

– No, I have never heard of that and I cannot open a business account for you, the bank officer would not budge.

– Dear sir, this is a form of entrepreneurship that you as a personal banker should know something about, and if you don’t know, check the tax administration’s website or call someone in the bank who does, I was persistent.

The manager comes, looks at me pale, another superior comes and nothing. I have already been in the bank for an hour and it does not bode well. I remember my colleague who recommended the accountant and give them his name and surname, I know he is in the same bank, to check how they opened an account for him. And lo and behold – there is hope. They study, look, investigate, and at the same time, a fourth person arrives. Finally, the brain trust takes pity on me and says they will open an account for me, they apologize, but it is all due to the confusion around JMBG and OIB – that if the OIB was already valid (in October 2012 it was not, it became valid on January 1, 2013), I would not have had any problems opening the account. I thank them and leave the bank – finally, I have all the papers.

I decide to try once more at the unemployment office, in the meantime, my caseworker has disappeared, replaced by a kind lady. I submit all the papers to her and she looks at me in astonishment and says she understands everything, but that based on those papers she still cannot deregister me from unemployment because they really only recognize the trade license and the excerpt from the commercial court. But she comforts me – just don’t report to unemployment for 30 days and we will automatically remove you from the records. Congratulations on your courage and persistence, and I wish you much success with your business, I know you will succeed because you seem entrepreneurial and hardworking – she says.

After three and a half years of self-employment, I do not regret that I decided to go for a sole proprietorship. I have an excellent accountant who warns me of all legal and tax changes, excellent clients, I pay everything to the state on time, and the business is gradually growing. When it grows to a certain limit, I will open a limited liability company in which, I hope, there will be a need and space for a combination of youth and experience in new jobs. Today, I happily follow the public institution tenders for grants for freelance professions, and my face lights up when I come across the tax administration’s page where, in addition to citizens, non-residents, associations, and companies, there is a section for craftsmen, freelance professions, and farmers.

Finally, a friend calls me who has decided to start a sole proprietorship after many years of unemployment. She cannot open a current account at the bank. She remembered that I had problems too. I tell her – give them my name and surname, here is my OIB, so they can remind themselves how they opened it for me. She calls me back in 45 minutes all happy – I did it. As soon as they saw your details, they immediately took care of everything.