Taxes - Czech Republic

Updated 10/2010

Legal requirements

Tax issues are generally regulated under the Act on Administration of Taxes and Fees.

Act on Administration of Taxes and Fees

Taxes are either direct and depend on income, or indirect and relate to consumption (the purchase of goods and services).

Tax system

There are nine different tax categories:

income tax - this represents the main tax obligation. It is divided into income tax on natural persons (15%) and income tax on legal entities (19%).
Detailed information on income tax
Value added tax (VAT) - VAT is an indirect tax applied to most taxable supplies in the Czech Republic. There are two different rates: a basic rate of 20% and a discounted rate of 10%.
Detailed information on value added tax
Further information on value added tax
excise duty - this tax is applied to some specific types of goods (mineral oils, spirit, beer, wine, and tobacco products).
Rates of tax on mineral oils
Rates of tax on spirits
Rates of tax on beer
Rates of tax on wine and intermediate products
Rates of tax on tobacco products
Detailed information on excise duty
Road tax - this applies only to vehicles used for business activities. Tax rates are defined as fixed annual amounts.
Detailed information on road tax
Real estate tax - this generally applies to land and buildings. There are, however, many exceptions. Land tax depends on either the plot area or the price of the land as well as the usage of the land and its location. Tax on buildings depends on the size of the built-up area, what the building is used for and its location. Generally, the larger the town/city, the higher the rate.

Detailed information on real estate tax

Real estate transfer tax - this applies when transferring real estate for a payment. The unified tax rate is defined as 3% of the price of the real estate.
Detailed information on real estate transfer tax
inheritance tax - applies to assets acquired through inheritance. Certain groups are not subject to inheritance tax
Detailed information on inheritance tax
gift tax - a one-off tax which applies to the payment-free acquisition of assets. Certain groups are not subject to gift tax.
Detailed information on gift tax
environmental tax - this is a tax on electricity, natural gas and solid fuels
Detailed information on environmental tax

Each type of tax is defined in a specific law. The administration and collection of the individual taxes is the responsibility of the Ministry of Finance of the Czech Republic and its subordinate administrative bodies, particularly the local tax offices.

Ministry of Finance of the Czech Republic
Contact list of financial authorities
Overview of tax legislation

Administrative procedures

Tax registration

Self-employed business owners must register with the local tax administration body within 30 days of obtaining their business licence.

The obligation to register is set out in the Act on Administration of Taxes and Fees.

Value added tax is governed by in the Act on Value Added Tax. Under this Act, persons must pay the tax if their turnover exceeds CZK 1,000,000. Such persons (tax payers) must submit an application for registration within 15 days of the end of the calendar month in which this amount was exceeded.

Registration for value added tax
Registration form for value added tax
Registration for individual taxes
Tax forms, including registration forms

Submitting your tax return

Tax returns may be submitted on the traditional printed form either at the relevant local financial office, or in electronic form in the Czech Tax Authority's e-submission (ESU) application.

Online tax submissions
Contact list of local financial authorities

Tax return forms:

Income tax of natural persons
Income tax of legal entities
Value added tax
Road tax
Real estate tax
Inheritance tax
Gift tax
Real estate transfer tax
Environmental tax
Czech Tax Authority
Tax authority - online services

Resources

The following governmental and non-governmental web portals offer further information and useful services on accounting and tax issues.

BusinsessInfo.cz - official portal for business and export
Portal of the Public Administration of the Czech Republic

Check also the legislation on this topic in:

Taxes - Czech Republic