Ready to start a business in the Czech Republic? Our local tax experts have summarised 10 key facts you should consider when it comes to the Czech tax system. For a more complex overview, we recommend to take a look on our Tax guideline for 2021.
- 5 % on basic investment funds
- 0% on pension funds
- Dividends paid by a subsidiary from EU or non-EU countries
- Income from sale or participation in a subsidiary in EU or non-EU countries
For payment to EU/EEA
For payment outside EU/EEA
Note: Dividends paid by a subsidiary to parent company, that holds 10% share uninterrupted in the past 12 months, are exempt from taxation. Interest and Royalties could be also a tax exempt under the implemented EU directive.
For selected types of goods: food, non-alcoholic beverage, plants, special healthcare products, pharmaceutical products
For selected types of goods and services: infant nutrition, drugs and vaccines, books, water and sewer rates, public transportation, hotel accommodation, catering, entry to cultural and sport events, minor repairs, hairdressing services
SOCIAL SECURITY AND HEALTH INSURANCE CONTRIBUTIONS – EMPLOYEE
6.5 % Social security, applied up to annual cap
4.5 % Health insurance
SOCIAL SECURITY AND HEALTH INSURANCE CONTRIBUTIONS – EMPLOYER
24.8 % Social security, applied up to annual cap
9 % Health insurance
Tax base up to 48 multiple of the average wage
Tax base exceeding the limit
For 2021 the limit is CZK 1,701,168 or EUR 54,300 per year, i.e. CZK 141,764 or EUR 5,400 per month.
- Sale of house or flat, if the seller has a permanent residence for min. 2 years before the sale
- Sale of immovable asset, when the period of ownership exceeded 5/10 years before the sale
- Sale of movable property, with exceptions
- Sale of a share in a LLC, if the share was held for at least 5 years before the sale
- Sale of securities, if held for min. 3 years before sale or if total income is less than CZK 100,000, i.e. EUR 3,800
- Pensions up to CZK 439,200, i.e. EUR 16,600
Losses generated from independent activities and rental activities may be set off against all types of income, except the employment income.
Standard carry-back period, max. amount of CZK 30 million
Standard carry-forward period
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We have years of experience in supporting businesses to grow in the Czech Republic. If you are a well-established company we offer you a free consultancy, that includes:
- Brief analysis of your needs based on the information provided
- Country-specific aspects that may be important to your investment
- Basics of local tax, accounting and legal rules in the Czech Republic