Czech Republic Income Tax Calculator (CZ) 2024

Czech Republic Income Tax

Want to understand and benefit from the Czech Republic Income Tax? Here are all the rules that are important when considering saving on taxes.

The Czech Republic offers one of the most attractive tax systems in the entire EU. (See also Cyprus here.)

Today, we’re going to dive into the world of personal income tax to the level of detail. So, let’s get started!

Who Pays Taxes To CZ

First things first, let’s talk about the basics. If you have a permanent home available to you in the Czech Republic, you’re a tax resident. This doesn’t necessarily mean you own the property. Even if you’re renting, it still counts as a permanent home.

Secondly, if you spend more than 183 days in a calendar year in the Czech Republic, you’re also considered a tax resident. These days don’t have to be consecutive. So, if you’re planning to stay in the Czech Republic for a significant amount of time, keep an eye on the calendar!

As a tax resident, you’re required to pay tax on your worldwide income in the Czech Republic. This includes income from employment, self-employment, rental income, interest, dividends, and other income.

Income Tax Rates

The personal income tax rate in the Czech Republic stands at a flat 15%. This means that no matter how much you earn, you’ll be giving 15% of your income to the taxman.

Simple, right?

But wait, there’s a catch! If you’re a high earner, there’s an additional tax you need to know about.

The Czech Republic introduces a solidarity tax for those earning more than 1,672,080 CZK annually. If you fall into this category, you’ll pay an extra 7% on the amount exceeding this threshold. So, in essence, the tax rate for high earners can reach up to 22%.

Tax Deductions In CZ

Now, let’s talk about tax deductions. The Czech Republic offers a basic tax deduction of 24,840 CZK per year. But that’s not all! If you have children, you’re in for a treat. For each child, you can deduct an additional 24,840 CZK from your taxable income.

Check here how much is CZK compared to EUR.

And there’s more good news for parents. If you’re a single parent, the Czech Republic gives you an extra helping hand. You can deduct 24,840 CZK for one child, 29,640 CZK for two children, and a whopping 34,440 CZK for three or more children.

But what if you’re not a parent? Don’t worry, the Czech Republic hasn’t forgotten about you. If you’re taking care of a dependent (like an elderly parent or a disabled sibling), you can deduct 24,840 CZK from your taxable income.

And finally, let’s not forget about tax credits. In the Czech Republic, you can claim a tax credit of 2,070 CZK for yourself. If you’re married, you can claim an additional 2,070 CZK for your spouse. And if you have children, you can claim 13,404 CZK for each child.

Final Thoughts

With its 15% flat tax rates, The Czech Republic is extremely attractive to those who want to pay low taxes. Even if you are a high earner, you pay a 22% tax on your income (in some countries, such as The Netherlands, this would be 50%).

And with further tax deductions that almost everyone gets, no matter how much you earn, you can save lots of money if you relocate to CZ.

Don’t forget to ask questions if you have any.