Act No. 286 / 1992 Coll.
Income Tax Act
Valid
Effective from 01.01.1993
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286
THE LAW
of 28 April 1992
on income taxes
The Federal Assembly of the Czech and Slovak Federal Republic decided on this law:
This law provides for:
(a) income tax on natural persons;
(b) corporation tax.
TAX FROM THE REVENUE OF PHYSICAL PERSONS
Taxes on personal income tax
(1) The taxable persons are natural persons ("taxpayers").
(2) Taxpayers who reside or usually reside in the territory of the Czech and Slovak Federal Republic have a tax liability which covers both income from resources in the territory of the Czech and Slovak Federal Republic and income from resources abroad.
(3) Taxpayers who do not reside or usually reside in the territory of the Czech and Slovak Federal Republic have a tax liability which applies to income generated from resources in the territory of the Czech and Slovak Federal Republic (§ 22).
(4) Pricers usually present in the territory of the Czech and Slovak Federal Republic are those who stay for at least 183 days in the relevant calendar year, continuously or in several periods except those who stay for study or treatment. Each day of stay begins, except for the taxpayer, who receives income from resources in the territory of the Czech and Slovak Federal Republic from dependent activities and the border to the Czech and Slovak Federal Republic exceeds daily or during agreed periods of time only for the purpose of carrying out this activity.
Subject matter of natural person income tax
(1) The subject of the income tax on natural persons (hereinafter referred to as tax) shall be:
(a) income from dependent activities and functional benefits (Section 6);
(b) income from business and other self-employed activities (Section 7);
(c) income from capital assets (Section 8),
(d) rental income (Section 9);
(e) other revenue (Section 10).
(2) Income within the meaning of paragraph 1 shall mean income from both monetary and non-monetary gains and from exchange.
(3) Non-monetary income shall be valued at the usual price at the place and at the time of completion, according to its type and quality, and, where appropriate, its state and extent of wear, unless otherwise provided for in this Law or in a special regulation.
(4) The subject matter of the tax is not:
(a) income generated by the acquisition of shares under a special law, (1) by inheritance, issue of m2) or by the donation of real estate or movable property or property rights, with the exception of income accruing therefrom, and excluding donations provided in connection with the pursuit of an activity under Paragraph 6 or with a business or other self-employed activity;
(b) loans and loans.
Exemption
The following shall be exempt:
(a) income from the sale of an apartment or a house with a maximum of two apartments, including associated parcels, provided that the seller was resident there for at least two years before the sale;
(b) income from the sale of real estate not referred to in (a), if the period between acquisition and sale exceeds five years. The exemption shall not apply to income from the sale of real estate which is the subject of a taxpayer's business or in which the taxpayer carries out business or other self-employed activity, within five years of the end of that activity. Furthermore, the exemption does not apply to revenue accruing to the taxpayer under a future property sale contract concluded within five years of the acquisition, even if the purchase contract is not concluded until five years after the acquisition;
(c) revenue from the sale of movable goods. The exemption shall not apply to revenue from the sale of motor vehicles, aircraft, ships and securities, provided that the period between acquisition and sale does not exceed one year. The exemption shall also not apply to income from the sale of movable property which is the subject of the taxpayer's business or is used for his business or other self-employment, within one year of the end of the activity. This provision does not apply to capital gains (Section 8);
(d) the compensation received, the performance of the property insurance and the performance of the liability insurance, except for payments received for loss of income;
(e) revenues from the operation of small hydropower plants up to 1 MW, wind power plants, heat pumps, solar installations, biogas plants, biodegradable plants, which provide for generally binding legislation, geothermal energy facilities, in the calendar year in which they were put into service and in the following five years;
(f) the price from the competition and the price from the sport competition, with a value not exceeding 10 000 CZK, with the exception of the price from the sport competition for taxpayers for whom the sport activity is a business (Section 10 (8));
(g) compensation received under special regulations, (2) income from the sale of immovable property or movable property issued under special regulations (2) and interest on government bonds issued in connection with rehabilitation proceedings for redress;
(h) income provided in the form of benefits, aids and services from compulsory social insurance, employment and health insurance and benefits from compulsory foreign insurance of the same type, as well as social benefits provided instead of compulsory insurance benefits;
(ch) income received as part of maintenance obligations under the Family Act;
(i) welfare and state benefits provided for in specific regulations;
(j) remuneration paid to health care authorities for blood collection and other biological materials from the human organism;
(k) aid (grants, scholarships) from public funds and from foundations, except payments received in return for loss of income;
(l) benefits from the insurance of persons, except for the insurance of a certain age exceeding the principal;
(m) performance provided by the armed forces to the soldiers of essential (replacement) service and to the soldiers in reserve called for exercises under special regulations; 3)
(n) disciplinary fees granted to the members of the armed forces and corps under special regulations; 3)
(o) social benefits under the Law on certain services3) and benefits related to the termination of the service of members of the armed security corps;
(p) services provided to citizens in connection with the performance of civil service;
(r) revenue from the transfer of members of the cooperative's rights or from the transfer of participation in companies, if not for the sale of securities, if the period between acquisition and transfer exceeds five years.
Tax base
(1) The basis of the tax is the amount by which the revenue generated by the taxpayer in the calendar year (hereinafter referred to as the "tax period") exceeds the expenditure evidently incurred to achieve, secure and maintain it, unless otherwise provided for in the various types of income (Sections 6 to 10).
(2) In the case of a taxpayer who receives at the same time two or more of the types of income referred to in paragraphs 6 to 10 during the tax period, the taxable amount shall be the sum of the sub-bases of the tax determined by type of income, using the provisions of paragraph 1.
(3) If, according to the accounts, expenditure exceeds the revenue referred to in paragraphs 7 and 9, the difference is a loss. The loss shall be reduced by the sum of the sub-bases of the tax determined on the basis of the types of income referred to in paragraphs 7 to 10, using the provisions of paragraph 1. The loss or part thereof which cannot be applied to the taxation of income during the tax period in which it was incurred may be deducted from the sum of the sub-bases of the tax determined on the basis of each of the types of income referred to in paragraphs 7 to 10 in the subsequent tax periods provided for in paragraph 34.
(4) Revenue accruing to a taxpayer not accounting in the double-entry system no more than 15 days before the beginning or no more than 15 days after the end of the tax period to which he belongs economically shall be treated as income arising from that tax period. The assessment of expenditure shall be treated mutatis mutandis. The income from dependent activity and functional benefits (Section 6) resulting from the taxpayer not more than 25 days after the end of the tax period for which they were obtained shall be considered as income from the taxpayer in that tax period. In the case of a taxpayer with an income pursuant to paragraphs 7 and 9, account shall be taken of the stocks taken in the calendar year preceding the year in which the taxpayer started his activity. Similarly, other expenditure necessarily incurred as a result of the start of the activity shall be assessed.
(5) The tax base does not include income exempt from tax and income for which it is further established that the tax is levied at a special tax rate under Paragraph 36 on the tax base.
Revenue from dependent activities and functional benefits
(1) Revenue from dependent activities are:
(a) revenue from the current or former employment, professional or member relationship or similar relationship in which the payer is obliged to follow the instructions of the payer in the course of his work for the payer's income. These revenues include income for the work of pupils and students from practical training;
(b) income for the work of members of cooperatives and members of limited liability companies, even if they are not obliged to follow orders from another person in the course of their work;
(c) remuneration of members of statutory bodies and other legal entities.
(2) The taxpayer with income from dependent activity is hereinafter referred to as "employee ', the income payer as" employer'.
(3) The revenue referred to in paragraph 1 shall mean revenue on a regular or one-off basis, whether or not it is a legal claim on it, whether it is received from the employer by the employee or by the person to whom the right has been transferred and whether it is paid or credited to good or consists of another form of performance by the employer for employees who are liable for income from dependent activities.
(4) The revenue referred to in paragraph 1 (a) resulting from resources in the territory of the Czech and Slovak Federal Republic by employees in a legal relationship with an employer for a period not exceeding five calendar days in a calendar month, the aggregate amount of which does not exceed 3000 CZK in a calendar month, following the reduction provided for in paragraph 12 (a), is a separate tax base for taxation at a specific rate (§ 36).
(5) The revenue referred to in paragraph 1 (c) resulting from sources within the territory of the Czech and Slovak Federal Republic is a separate tax base for taxation at a specific rate of tax (§ 36). If such revenue and revenue as referred to in paragraph 4 arise from sources abroad, they shall be the basis of the tax (sub-base) in accordance with Paragraph 5 (2).
(6) If the employer provides a motor vehicle to a staff member for service and private purposes, the income of a staff member included in the tax base shall be considered to be 12% of the purchase price of the vehicle in a calendar year or 1% even in the beginning of the calendar month, if the vehicle is only used for part of the year. If it is a hired vehicle, the purchase price of the vehicle shall be based on the original owner, even if the hired vehicle is subsequently purchased.
(7) The following shall not be regarded as income from dependent activities and the subject of tax, other than income which is not subject to tax under Paragraph 3 (4):
(a) reimbursement of travel expenses provided in connection with the exercise of dependent activity up to the amount laid down in the special regulation; (5) where the employer pays higher compensation, amounts which exceed the amount laid down in the special regulation; (5) the taxable income referred to in paragraph 1, even if this special regulation does not limit the payment of higher refunds.
(b) the value of the personal sanitary, protective and occupational clothing provided, including their maintenance (e.g. working clothes, uniforms);
(c) the amounts received by the employee of the advance payment from the employer in order to issue them on his behalf or the amounts by which the employer pays the employees the declared expenses they have incurred for the employer as if they had been incurred directly by the employer.
(8) In addition to the revenue referred to in § 4, the following are exempt:
(a) the amounts spent by the employer on training staff related to his business; the exemption shall not apply to amounts paid to staff members as compensation for income foregone;
(b) the value of the catering provided as non-monetary benefits by the employer to workers for consumption at the workplace or in the framework of the catering industry provided through other bodies;
(c) the value of non-alcoholic beverages provided as non-remuneration by the employer to workers for consumption at the workplace;
(d) non-monetary benefits provided by the employer to employees in the form of possibilities for the use of recreational, medical and educational facilities, pre-school facilities, racing libraries, gym and sports facilities, or in the form of a contribution to cultural programmes and sports events;
(e) an insurance policy which the employer is obliged to pay for the staff of the social insurance fund, the employment fund and the health insurance fund;
(f) an advantage granted by an employer operating public transport of persons to its employees and their family members in the form of free or discounted tickets;
(g) the income of members of housing cooperatives from the personal performance of self-supporting cooperative housing construction, which are not paid in cash but are credited to their membership shares;
(h) income generated by the acquisition of employee shares under the special rule (5a) at a lower value than the nominal value, with the exception of income accruing from them and income accruing from the sale (repayment) of such shares, than the acquisition value which is considered to be income from capital goods [Paragraph 8 (3) (a)].
(9) The functional benefits are:
(a) the functional salaries of members of governments, members of the Federal Assembly, the Czech National Council, the Slovak National Council and the salaries of the Heads of Central Government Authorities;
(b) remuneration for the performance of duties in the local authorities, in other local authorities; State bodies, civil and interest associations, chambers and other institutions.
(10) They shall not be regarded as a functional benefit and shall not be the subject of a tax refund granted in respect of the performance of a function to which entitlement under the special rules arises, except for the reimbursement of income foregone.
(11) Paragraphs 7 and 8 shall apply mutatis mutandis to transactions provided in connection with the performance of functions.
(12) The tax base (sub-base) shall be income from dependent activities or functional benefits, with the exception referred to in paragraphs 4 and 5, reduced by:
(a) social insurance, insurance employment and health insurance, which, under special rules, is required to be paid by the staff member; for staff covered by compulsory foreign insurance of the same type, contributions to such foreign insurance;
(b) an amount of 200 CZK for each calendar month of work for the partial reimbursement of the transport costs of the worker between the place of residence and the place of work, provided that the distance does not exceed 30 km and that the staff member is working there for more than five days in a calendar month. If the distance exceeds 30 km, the amount shall be increased to 300 CZK. Holders of free or discounted tickets provided by an employer operating public transport of persons to their employees and their family members shall be entitled to this increase only if they prove that they cannot use a free or discounted ticket when travelling to the workplace.
Revenue from business and other self-employment
(1) Enterprise income is:
(a) income from agricultural production, forestry and water management, 6)
(b) business income, 7)
(c) income from other business according to special rules;
(d) the shares of the shareholders of the public commercial company and the associates of the limited partnership in profit (§ 13).
(2) The income from another self-employed activity, if not covered by the income referred to in § 6, is:
(a) revenue from the use or provision of industrial or other intellectual property rights, including copyright rights, (8) including revenue from the issue, reproduction and dissemination of literary and other works by own expense;
(b) income from the pursuit of an independent profession which is neither business nor business under special rules.
(3) The taxable amount (sub-taxable amount) is the revenue referred to in paragraphs 1 and 2, with the exception of paragraph 6. This revenue shall be reduced by the expenditure incurred to achieve, secure and maintain it, with the exception of the revenue referred to in paragraph 1 (d). Paragraph 23 to 34 shall apply to the determination of the tax base (sub-tax base). The revenue referred to in § 22 (1) (d) (1) to (3) to the taxpayers referred to in § 2 (3) is a separate tax base for taxation at a specific tax rate (§ 36).
(4) The income referred to in paragraph 1 (d) shall be reduced by social insurance, insurance employment and health insurance, which shall be payable by a member of a public commercial company or an associate of a limited partnership, provided that such insurance is not borne by a public commercial company or a limited partnership.
(5) In the event that the company's management in accordance with its accounts has ended in a loss, the shareholders of the public companies and associates of the limited liability companies will report a share of the company's loss as a loss in application of § 5 (3). The loss shall be distributed in a similar manner to the income.
(6) The revenue referred to in paragraph 2 (a) up to and including 3000 CZK for the contribution to newspapers, magazines, radio or television, resulting from resources in the territory of the Czech and Slovak Federal Republic, is a separate tax base for taxation at a specific rate of tax (§ 36).
(7) If the taxpayer does not apply the expenditure evidently incurred to achieve, secure and maintain income, he may apply the expenditure of:
(a) 50% of income from agricultural production, forestry and water management, 6)
(b) 30% of the revenue referred to in paragraph 2 (a), with the exception of revenue referred to in paragraph 6;
(c) 20% of business income, other business income under the special rules and income referred to in paragraph 2 (b).
(8) Where the taxpayer applies the expenditure referred to in paragraph 7, the amounts of expenditure shall include all expenses incurred by the payer in the context of the achievement of income from business and other self-employment.
Revenue from capital goods
(1) The income from capital goods, in the absence of revenue pursuant to Article 6 (1) or 7 (1) (d), are:
(a) profit shares (dividends), interest and other benefits on securities or participation in limited liability companies and limited companies, and profit shares and similar benefits from membership of cooperatives;
(b) shares in silent partnership profits from participating in business unless they are used to supplement the deposit minus the share of losses up to the original amount;
(c) interest, winnings and other income on deposits on books, certificates and deposits based on them, including interest on funds in the holding account;
(d) benefits from insurance in the event of a certain age or pension insurance outside the social insurance fund, less premiums paid. Paragraph 10 (6) shall apply to the calculation of the tax base;
(e) interest and other income on loans and loans granted and interest on deposits in current accounts, interest on the value of the deposit paid in the contractual amount of the members of public companies. Deposits in current accounts that are not intended for business under the terms of the Bank (spore accounts, foreign exchange accounts) shall be treated in accordance with point (c);
(f) discount amounts for notes.
(2) For the purposes of this Act, the participation referred to in paragraph 1 (a) shall mean both a monetary and non-monetary contribution to the business.
(3) Furthermore, the following shall be regarded as income from capital goods:
(a) the difference between the nominal value of the security [paragraph 1 (a)] or the deposit note [paragraph 1 (c)] paid and the selling value on issue; in the case of early repurchases, the price of repurchases shall be used instead of the nominal value;
(b) revenue from the sale of the right to purchase shares.
(4) The revenue referred to in paragraph 1 (a), (b), (c), (d) and (3) (a), in so far as the revenue referred to in paragraphs 6 (1) or 7 (1) (d) is not concerned, resulting from resources within the territory of the Czech and Slovak Federal Republic, is a separate tax base for taxation at a specific rate (§ 36). If this income comes from sources abroad, the tax base (the sub-base of the tax) is as defined in Section 5 (2).
(5) The revenue referred to in points (e) and (f) of paragraph 1 and in point (b) of paragraph 3, not reduced by expenditure, is the basis of the tax (sub-base).
(6) Interest and other income arising from deposits received by the employer only from its employees or received by the bank only from its employees under derogatory conditions than from other natural persons are a separate tax base for taxation at a specific tax rate (§ 36).
Revenue from renting
(1) In the absence of revenue referred to in paragraphs 6 to 8, rental income is:
(a) income from the rental of real estate, apartments or parts thereof;
(b) income from the rental of movable property, other than occasional leasing provided for in Article 10 (1) (a).
(2) The basis of the tax (sub-base of tax) is the revenue referred to in paragraph 1, minus the expenditure incurred in achieving, securing and maintaining it (§ 5 (2)). Paragraph 23 to 34 shall apply to the determination of the tax base (sub-tax base). The income from the lease to the taxpayers referred to in § 2 (3) is, with the exception of the income from the rental of the property, a separate tax base for taxation at a specific tax rate (§ 36).
(3) If the taxpayer does not apply the expenditure evidently incurred, he may apply it at the rate of 20% of the revenue referred to in paragraph 1.
Other revenue
(1) The other revenue resulting from the increase in assets in the absence of revenue pursuant to paragraphs 6 to 9 are in particular:
(a) income from occasional activities or the occasional hire of movable property, including income from agricultural production which is not operated by an entrepreneur (self-employed farmer);
(b) income from the sale of own real estate or movable property, including securities, with the exception referred to in Section 4;
(c) income from the transfer of a participation in a limited liability company, a limited partnership or a share in the capital of a cooperative with the exception referred to in § 4;
(d) income from inherited industrial and other intellectual property rights, including copyright and related rights, 9)
(e) received maintenance, pensions (10) and similar recurring benefits with the exception referred to in § 4;
(f) the share of a member of a trading company or a member of a cooperative in the liquidation balance of the company or cooperative;
(g) the share of the settlement interest in the termination of the participation of the shareholder in the company or in the cooperative;
(h) lotteries, betting and other similar games and competition and composition wins with the exception referred to in paragraph 2 (b);
(ch) prices from competitions and sports competitions with the exception referred to in § 4.
(2) In addition to the revenue referred to in § 4, the following shall be exempt:
(a) the revenue referred to in paragraph 1 (a), provided that their total for the taxpayer does not exceed CZK 6 000 in the tax period;
(b) prizes from lotteries, bets and similar games operated on the basis of permits issued under special regulations. 11)
(3) The basis of the tax (sub-base of tax) is income less expenditure evidently incurred to achieve it. Where the expenditure related to each of the types of income referred to in paragraph 1 is higher than the income, the difference shall not be taken into account. If the income referred to in paragraph 1 (h) and (ch) comes from sources abroad, the basis of tax (sub-base of tax) shall be income not reduced by expenditure. The expenditure may be used in accordance with Article 7 (7) (a) in respect of agricultural production revenue. Revenue arising from instalments under a contract of sale concluded or an advance under a contract for the future sale of real estate shall be included in the sub-base of tax for the tax period in which they were achieved.
(4) For the revenue referred to in paragraph 1 (b), the expenditure shall be the cost of the valuation of the item for which the debtor has proven to have acquired the case and, if it is inherited or donated, the price determined for the purposes of the inheritance tax or donation. In the case of a case brought by an exchange, the case is based on the price of the case at the place and at the time of its acquisition (§ 3 (3)). The expenditure shall also be the amounts evidently spent on repair, maintenance or other evaluation. The value of the taxpayer's own work on the items he has produced or evaluated himself shall not be taken into account in determining expenditure. Expenditure in excess of revenue resulting from instalments or advances for future sales of real estate in the tax period for the first time may be used in that tax period up to the amount of that income. Where such revenue also results in a further tax period, it shall be treated mutatis mutandis, up to the amount of the total amount that can be applied under this provision.
(5) In the case of revenue referred to in paragraph 1 (c), (f) and (g), expenditure shall be deemed to be a deposit or an acquisition price for a share. The non-cash contribution is valued in the same way as the non-cash income at the time of the deposit (Section 3 (3)). If the asset is a property acquired or acquired less than two years before the transfer to a company or cooperative, the cost of the acquisition or acquisition of the property or the residual price, if the tangible property is already amortised, shall be deemed to be expenditure. The issue is not a share of the cooperative's assets transferred in the context of the transformation of cooperatives under the special regulation11a) except for the share or part thereof which is a replacement under the special regulation.2)
(6) A pension under the special legislation10) is considered as a taxable base (sub-taxable basis) after a reduction by the amount of the purchase price evenly distributed over the period of retirement. This period is found to be the difference between the median length of life 12) and the age of the taxpayer at the time when the pension begins to receive for the first time. The income provided by the employer to its employees, including former employees, is revenue under Section 6.
(7) The revenue referred to in paragraph 1 (f) to (h) resulting from resources in the territory of the Czech and Slovak Federal Republic is a separate tax base for taxation at a specific tax rate (§ 36). If this income comes from sources abroad, the tax base (the sub-base of the tax) is as defined in Section 5 (2).
(8) The income from the prices of public competitions and sports competitions resulting from resources in the territory of the Czech and Slovak Federal Republic is a separate tax base for taxation at a special tax rate (§ 36). Where a contract price includes a remuneration for the use of a work or performance, the amount attributable to that remuneration shall be reduced by the taxable amount taxed at a special tax rate and shall be included in the revenue referred to in Section 7. In the case of taxpayers (§ 2 (2)) for whom the sport activity is an undertaking, the prices received from sports competitions shall be considered to be the revenue referred to in § 7. In the case of revenue accruing from competition prices and sport competitions from sources abroad, the tax base (sub-base of tax) is the basis of Article 5 (2).
(9) In the same way as prices from competition, prices from contests in which the competitors are restricted by the conditions of the competition or are the competitors selected by the organiser. If, in such a competition, the price or the sum of the prices obtained by the same taxpayer exceeds CZK 20 000, the revenue referred to in Article 7 shall be: Revenue from competitions declared by the employer for its employees shall be considered as revenue referred to in Section 6.
Calculation of co-owner's income
Revenue received jointly by two or more taxpayers on the basis of joint ownership of the case or of common rights and the common expenditure incurred to achieve, secure and maintain them shall be distributed among the taxpayers according to their joint ownership interests.
Calculation of income of a participant in an association that is not a legal person
(1) The revenue generated by the taxpayers in the joint venture or in the joint other self-employment activity (§ 7) under the association contract and the expenditure incurred in achieving, securing and maintaining the income shall be distributed equally among the taxpayers, unless otherwise specified in the association agreement.
(2) Revenue generated in the course of a business or other self-employed activity (Section 7), carried out in cooperation with persons living in the common household with the taxpayer, and expenditure incurred in achieving, securing and maintaining them, are also distributed to those cooperating persons, so that their share of the common income and expenditure is not more than 20% in total. The income may not be allocated to children under compulsory education or in the calendar year in which it is terminated, and to children and a spouse (spouse) when they are used as dependants (§ 15).
Calculation of the tax base of a public company shareholder and an associate of a limited company
(1) The public commercial company ascertains the tax base for the company as a whole (§ 23 to 33) as well as the taxpayer. According to the shares provided for by the social agreement, this tax base shall be distributed to individual members for which the taxable amount (sub-taxable basis) is established in accordance with Paragraph 5 (2), if the shareholder is a natural person, or if it is included in the tax base under Paragraph 23, if the shareholder is a legal person. The loss of a public company (§ 34) is distributed in the same way as the tax base.
(2) The tax base of a public company is not reduced by the gifts provided for in Paragraph 20 (4). The gifts are considered as gifts provided by individual members pursuant to Paragraph 15 (8) and are distributed to individual members in the same way as the tax base established for a public company.
(3) The Comandite company ascertains the tax base for the company as a whole (Section 23). The tax base thus established shall be deducted from the shares belonging to the individual complementers under the social contract and shall constitute the tax base (sub-base) in accordance with § 5 (2) if the complementers are natural persons or the taxable basis in accordance with § 23 if the complementers are legal persons. The remaining tax base is the tax base of a limited company. The loss of a limited company is distributed in the same way as the tax base.
(4) The gifts provided by the limited liability company (Paragraph 20 (4)) are divided into complementary companies and limited companies in the same proportion as the taxable amount established for the company as a whole is distributed among them. The relative portion of the gifts belonging to the complementary is considered as gifts provided by individual complementaries.
Calculation of income tax achieved over multiple tax periods
(1) The revenue referred to in paragraph 2 resulting from several years of activity of a taxpayer or resulting from the use of a case and rights in several years at the same time may be divided equally into the tax period in which it was achieved and the tax period preceding, but not more than, three proportional parts. The revenue from the forestry sector generated by the extraction of timber may be divided into a maximum of 10 proportional parts. Expenditure relating to such revenue already incurred in taxing income during previous tax periods shall not be taken into account. One proportional part shall be included in the taxpayer's tax base in the tax period of income and the percentage of tax on the tax base shall be determined. This percentage shall be calculated by the tax on the remainder or, where applicable, the remainder of the income achieved over several tax periods.
(2) The calculation of the tax referred to in paragraph 1 shall apply only to revenue:
(a) agricultural production, forestry and watermanagement (6) (§ 7 (1) (a));
(b) referred to in Article 7 (2) (a) (8) and the activities of cultural heritage restoration and collection.
Non-taxable part of the tax base
(1) The taxable amount shall be reduced by:
(a) 20 400 CZK per year per taxpayer;
(b) 9000 Cds per year for a dependent child living in a shared household with a taxpayer, but not more than four children; the temporary stay of a child outside the common household does not affect the application of reductions;
(c) 12 000 CZK per year for a wife (spouse) living with a household taxpayer, unless he has his own income exceeding 20 400 CZK per year. The income shall not include an increase in the pension for helplessness, parental allowance, child allowance, retirement allowance and scholarship provided to students continuously preparing for their future occupation;
(d) 6 000 CZK per year if the taxpayer receives a partial invalidity pension;
(e) 12 000 Kčs per year where the taxpayer receives an invalidity pension or another pension, one of which is invalidity or is invalidity under special rules, but his application for an invalidity pension has been rejected for reasons other than his invalidity; if the taxpayer holds a ZTP-P card (particularly badly damaged with a guide), the amount shall be increased to 36 000 CZK per year, even if he does not receive an invalidity pension. The amounts referred to in points (d) and (e) may also be applied when entitlement to an old-age, invalidity and partial invalidity pension is combined.
(2) The amount referred to in paragraph 1 (a) shall not be reduced by the taxable person for whom the old-age pension from the Social Insurance Fund is more than 20 400 CZK per year. If it does not exceed 20 400 CZK per year, the amount referred to in paragraph 1 (a) shall be granted only at a rate less the amount of old-age pension paid. Child allowance and education allowance shall not be taken into account. According to this paragraph, it shall not be passed on to taxpayers who, at the beginning of the tax period, are not old-age pensioners and who have not been granted that pension retroactively at the beginning of the tax period.
(3) For the taxpayer referred to in § 2 (3), the taxable amount is not reduced by the amounts referred to in paragraph 1 (b) to (e).
(4) The following shall be considered as a dependent child of a taxpayer (own, adopted, cared-for child, replacing the care of the parent, the child of the second spouse and the grandchild, if his parents do not have income from which the reduction could be applied):
(a) a minor child;
(b) an adult child up to the age of 26 if he does not receive an invalidity pension; and
1. is continuously preparing for a future occupation through study or prescribed training; or
2. cannot prepare for a future occupation or be employed for a disease; or
3. for a long-term unfavourable health condition, it is unable to prepare itself continuously for a future occupation or it is capable of preparing itself only under exceptional conditions.
(5) If the child referred to in paragraph 4 (b) is married and living in a common household with his spouse, the spouse may apply the reduction under the conditions laid down in paragraph 1 (c). If the spouse does not have the income from which he may apply the reduction, he may apply the reduction referred to in paragraph 1 (b). (b) a parent of a child or of a taxpayer who, in relation to a child, is in the care of a parent, if the child is living with him in a common household.
(6) If a child (children) nourishes several taxpayers (e.g. spouses) within a single household, only one of them may apply them for tax purposes. When applying paragraph 7, the child (s) may be used for part of the tax period by one of the taxpayers and for the remaining part by the other.
(7) A taxpayer for which the conditions applicable to the reduction of the taxable amount referred to in paragraph 1 (b) to (e) only last for a few calendar months in the tax period shall reduce the taxable amount only by one twelfth for each calendar month at which the conditions were met. The child shall be paid by the taxpayer already in the calendar month in which he was born or in which the permanent preparation of an adult child for a future occupation begins.
(8) The value of donations granted to municipalities and legal persons based in the Czech and Slovak Federal Republic for the financing of science and education, culture, education, fire protection, support and protection of youth, social, health, environmental, humanitarian, charitable, religious, public-recognized churches and religious societies can be deducted from the tax base if the aggregate value of donations in the tax period exceeds 2% of the tax base or 1000 Kcs. In total, no more than 10% of the tax base can be deducted.
Tax rate
The tax on the tax base reduced by the non-taxable part of the tax base (§ 15), rounded to the nearest hundred KDS mines, is:
| přes Kčs | do Kčs | |||
|---|---|---|---|---|
| - | 60 000 | 15% | ||
| ze základu přesahujícího | ||||
| 60 000 | 120 000 | 9 000 Kčs+20 % | -“- | 60 000 Kčs |
| 120 000 | 180 000 | 21 000 Kčs+25 % | -“- | 120 000 Kčs |
| 180 000 | 540 000 | 36 000 Kčs+32 % | -“- | 180 000 Kčs |
| 540 000 | 1 080 000 | 151 200 Kčs+40 % | -“- | 540 000 Kčs |
| 1 080 000 | a výše | 367 200 Kčs+47 % | -“- | 1 080 000 Kčs. |
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Regulation Information
| Citation | Act No. 286 / 1992 Coll., on Income Tax |
|---|---|
| Regulation Type | - |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 18.06.1992 |
|---|---|
| Effective from | 01.01.1993 |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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