In recent years, especially after the accession of the Republic of Croatia to the European Union, the Republic of Croatia has become part of the single labor market and facilitated the employment of Croatian residents with employers in other countries. There is a pronounced trend of departure of residents of the Republic of Croatia, mostly to Germany, Austria, Switzerland, Ireland, Great Britain, etc. The working-age population leaves in search of a better paid job and the question arises as to whose tax residents they are because it depends on which country the right to tax the realized income belongs to. The total worldwide income of natural persons, whether the source of that income is receipt from self-employment, employment, capital, property and property rights and other receipts, is ultimately taxed in the State where the taxable person is resident for tax purposes. For this reason, it is necessary to establish tax residency in order to eliminate double taxation with the same type of income tax. Croatian tax residents are obliged to report income earned in or from abroad in the Republic of Croatia and submit to the Tax Administration data on earned income and paid tax abroad. By reporting foreign income to taxpayers, in some cases an additional tax liability will arise, while in other cases, additional tax liability will be absent. Non-residents are not obliged to declare foreign income in the Republic of Croatia. Tax residence is determined in accordance with the provisions of the double taxation agreement if the Republic of Croatia has concluded such an agreement with another country. If the Republic of Croatia does not apply a double taxation avoidance agreement with another country, tax residency is determined according to domestic regulations.