The Self Assessment System of Tax
The Czech Republic has a taxation system based on self-assessment.
This means that every taxpayer, be it an individual or a business, has the obligation to calculate the tax due to the government and to pay it.
Resident companies are taxed on their worldwide income.
Non-resident companies are taxed only on the income “sourced” from the Czech Republic.
A company is treated as a resident of the Czech Republic if it has its seat in or has its place of management in the Republic.
Corporate Tax Rates in Prague
The corporate income tax rate is levied at the general rate of 19%.
Basic investment funds pay tax at the rate of 5% and pension funds are not subject to tax.
In calculating taxable income, all expenses incurred in obtaining, ensuring and maintaining income are generally fully tax deductible.
This is provided the law does not list an expense as non-deductible or deductible only up to a limit
Withholding Tax on Dividends
Dividends paid to residents and non-residents are generally subject to 15% withholding tax.
There are exceptions to this rule, relating particularly to dividends paid by a subsidiary to a parent company.
The Czech Republic does not have controlled foreign Company legislation.
An expat seeking to establish a business in Prague would be greatly assisted by the expertise and specialist services of a qualified tax specialist in Prague.
Our E Team member is a highly regarded accountant and tax advisor in Prague and will be able to professionally guide an expat planning to do business in Prague.
EIBD has been providing expert accounting, tax, wage, and other administrative services in Prague since 2004.
With currently more than 150 clients, their services include comprehensive accounting, payroll, and tax services to businessmen and affiliates of multinational companies from different industries.
With their outstanding commitment to help their clients by providing excellent and cost friendly services, there’s no better partner in establishing and growing your business than EIBD.
To know more about them, please refer to the information below-
Contact Person: Ludek Bartak
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