Consumption taxes

Nature of the tax

Value added tax (VAT)

Tax rate

20%

Reduced tax rate

10% 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 ffective 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. 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. For more information access the tax guide on the Czech Republic from Deloitte.

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.

 

Pour aller plus loin dans vos recherches nous vous proposons de connaître les taxes locales qui s'appliquent à votre produit.

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

the Czech Republic and the United Kingdom are bound by a double taxation treaty: Yes

For more information

All information on Double Taxation Agreements on the website of the HMRC

HM Revenue & Customs website

We can find you the local taxes that apply to your product for you.

Accounting Rules

Tax year

The Amendment to Law on Accountancy allows taxpayers to keep accounts in another fiscal period than the calendar year. The fiscal tax year must have 12 consecutive months.

Accounting standards

The Czech accounting system is based on double-entry bookkeeping and is largely consistent with the systems of other European countries with certain minor difference regarding, for example, financial leasing or depreciation of fixed assets. Czech accounting rules are determined by the Ministry of Finance. They come from the National Accounting Standards. Czech Republic tries to get accounting rules in accordance with IAS, IFRS.

Accounting regulation bodies

Ministry of Finance

Accounting reports

Companies have to establish a balance sheet, a profit and loss account and annexes. Those accounts must be published in Czech, in CZK. More, companies obliged to have an audit must prepare the statement of cash flows and the statement of changes in equity. Corporations limited and societes listed on Stock Exchange have to publish the management report.

Publication requirements

The balance sheet and the profit and loss account must be prepared in accordance with the model which is on your disposal in the annexe of the Act. on Accounting.

 

Tax payers must file tax returns within three months following the end of the tax period. Czech legal entities that are required to prepare audited financial statements must file their tax returns within six months following the end of the taxable period.

Professional accountancy bodies

Union of Accountants
Chamber of Certified Accountants

Certification and auditing

Companies have to seek a statutory auditor to conduct an annual audit of the financial health of their organization. For more information, you can contact the Chamber of Auditors of the Czech Republic.

Accounting news

Union of Accountants
Ministry of Interior, coll. of codes