Transaction tax for foreign entities in Slovakia: When are you liable for taxation? | News Flash

As of January 1, 2025, Slovakia has introduced a new Act No. 279/2024 Coll. on the Financial Transaction Tax (FTT), which significantly affects foreign entrepreneurs and companies operating in Slovakia. The first taxation period began in April 2025.

What is subject to taxation?

• Debit financial transactions (even from a foreign account), if related to activity in Slovakia, and
• Recharged costs paid by a third party on your behalf in connection with activity in Slovakia.

Who is a taxpayer and who is the income payer?

Foreign legal entity becomes a taxpayer if:

• They have a bank account with a payment service provider (a bank) in Slovakia, or
• They conduct business in Slovakia via permanent establishment.

This tax does not apply to foreign self-employed persons.

Banks are generally the income payers of FTT. So, if a foreign entity has a bank account with a Slovak bank, the bank will automatically withhold and remit the FTT from debit transactions. However, in case of foreign bank accounts and recharged costs, the foreign entity (taxpayer) must calculate and remit the tax themselves.d and remit the FTT from debit transactions. However, in case of foreign bank accounts and recharged costs, the foreign entity (taxpayer) must calculate and remit the tax themselves.

What qualifies as conducting activity in Slovakia?

This new tax introduces a new type of permanent establishment, inspired by the legislation governing income tax and insurance tax. This concept is significant because legal entities without a registered seat in Slovakia will be considered taxpayers if they carry out activities in Slovakia through a permanent establishment.

For the purposes of the Financial Transaction Tax, a permanent establishment means:

• A fixed place of business in Slovakia if the activity exceeds 15 days during a calendar month,
• Online marketplaces or platforms and the sale of goods or services via an app or website with a Slovak domain (.sk) or hosted on servers located in Slovakia,
• Construction sites and places where construction or assembly projects are carried out for more than 15 days during a calendar month,
• The provision of services by a foreign person or persons working on its behalf for more than 15 days during a calendar month,
• A dependent agent who repeatedly negotiates or intermediates the conclusion of contracts on behalf of a foreign person,
• An insured risk located in Slovakia — such as insured real estate or insured vehicles registered in the relevant Slovak registry,
• A branch registered in the Commercial Register.

Please find below a few examples of business cases in Slovakia and how the tax liability is triggered:

What is the tax rate?

• 0.4% of the debit transaction amount from a Slovak or foreign bank account, up to €40 per transaction.
• 0.4% of a financial transaction amount related to the taxpayer’s business in Slovakia, recharged by a third party (if documented), up to €40 per transaction.
• 0.4% of recharged costs related to financial transactions for business in Slovakia (if individual transactions are not documented).

Tax deduction: How to avoid double taxation?

Recharged costs may be taxed twice. However, the law provides for tax deductions to prevent double taxation.

How we can help you:

• Assess if the new tax applies to you
• Analyze your transactions
• Set up the correct tax reporting

If you believe your company might be affected by the financial transaction tax in Slovakia starting 2025 and would like more information, our tax experts are here to help.

Barbora Juhásová

Tax Manager | Accace Slovakia

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