Consumption taxes

Nature of the tax

Value added tax (VAT)

Tax rate

20%

Reduced tax rate

14% of VAT on food, books, special healthcare products.

Other consumption taxes

Excise taxes are also perceived (on tobaccos, oil productions, beer, wines and liqueurs), applied according to the type and the quantities of products. They are payable under 10 days after announcement of Customs. Energy tax on supplies of electricity, natural and other gases, and solid fuels are effective since January 2008.
More detailed information on excise duties on the European Commission website.

Corporate taxes

Tax rate

Tax rate for foreign companies

All Czech tax residents are subject to these taxes on their worldwide income and capital gains, while Czech tax nonresidents are taxed only on their income from Czech sources.
The tax residency of a legal entity is its seat or place of effective management in the Czech Republic.

Capital gains taxation

Capital gains are taxed at the normal corporate income tax rate.

Main allowable deductions and tax credit

Tax deductible costs are similar to that in other countries (if incurred in order to generate, assure and maintain the taxable income): tax depreciation on assets, purchased material and services, wages, salaries and social security and health contributions.

Tax deductible items: charitable donations, research and development costs allowance, acumulated tax losses carried forward from previous year, tax relief. For any additional information.

Other corporate taxes

Withholding taxes, value added tax, real property tax and real estate tax, tax on operators of photovoltaic power plants. For any additional information access the PKF Tax Guide on the Czech Republic.

Individual taxes

Tax rate

Allowable deductions and tax credit

Employee's contribution to an old-age pension, a taxpayer's annual exemption, exemptions for non-working wife, disability allowance, high school / university students, etc. Tax deductions are granted for mortgage interest in Czech Republic, life and supplementary pension insurance, and gifts. Personal allowances are available for the taxpayer, her/his spouse and children.

Special expatriate tax regime

Taxable income includes earnings from dependent activities including benefits in-kind (e.g. housing allowances, use of a company car for private purposes, etc.), income from business activities, and income from capital, leasing and other sources.
For detailed information, consult the Taxation Guide provided by Czechinvest.

 

Double taxation treaties

Countries with whom a double taxation treaty have been signed

List of Treaties on Income and on Capital

Withholding taxes

Dividends: 0/15%, Interest: 0/15%, Royalties: 15%

Bilateral agreement

theCzech Republic and Tunisia are bound by a double taxation treaty: no

Sources of fiscal information

Tax Authorities

Czech Tax Administration

Other domestic resources

f">Czech Invest - report of the Czech tax system
Information on the local tax system