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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 2023.
5% is the rate of basic investment funds
0% is the rate of pension funds
Income from sale of participation in a subsidiary (CZ or another EU Member State resident).
Dividends and income from sale of participation in a subsidiary if the subsidiary is a non-EU resident from a “double tax treaty” country and is subject to corporate income tax which is not lower than 12%.
35% 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.
21%
15% for selected types of goods: food, non-alcoholic beverage, plants, special healthcare products, pharmaceutical products
10% 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
15% is the rate of personal income tax for a tax base up to 48 multiple of the average wage
23% is the rate of personal income tax for a tax base exceeding the limit
For 2023 the limit is CZK 1,935,552 or EUR 80,648 per year
24.8% for social security, applied up to annual cap
9% for health insurance
6.5% for social security, applied up to annual cap
4.5% for health insurance
Losses generated from independent activities and rental activities may be set off against all types of income, except the employment income.
2 years: standard carry-back period, max. amount of CZK 30 million
5 years: standard carry-forward period
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 4,160
Pensions up to CZK 622,800, i.e. EUR 25,950
About Accace
Accace is a proactive consultancy and outsourcing partner who bridges the gap between needs and solutions. Combining smart and streamlined technology with a holistic approach, we provide an all-round care to clients and consider their matters as our own. With over 800 experts and more than 2,000 customers, we have vast experience with facilitating the smooth operation and growth of small to large-scale, global businesses.
About Accace Circle
Accace operates internationally as Accace Circle, a co-created business community of like-minded BPO providers and advisors who deliver outstanding services with elevated customer experience and erase the borders of service delivery. Covering over 50 jurisdictions with nearly 2,500 professionals, we support more than 15,000 customers, mostly mid-size and international Fortune 500 companies from various sectors, and process at least 200,000 pay slips globally.
