Full text of Act No. 75 / 1994 Coll.
Act of the Czech National Council on Income Taxes (full text as seen from later amendments and additions)
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29.04.1994
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75
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announces the full text of the Act of the Czech National Council of 20 November 1992 No. 586 Coll., on Income Taxes, as follows from the amendments made by the Act of the Czech National Council of 21 December 1992 No. 35 Coll., by the Act of 25 February 1993 No. 96 Coll., by the Act of 19 May 1993 No. 157 Coll., by the Act of 10 July 1993 No. 196 Coll., by the Act of 3 December 1993 No. 323 Coll. and by the Act of 16 February 1994 No. 42 Coll.
The Czech National Council decided on this law:
This law governs
(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 are resident or usually resident in the Czech Republic have a tax liability which covers both income from sources in the Czech Republic and income from sources abroad.
(3) Taxpayers who are neither resident nor normally resident in the Czech Republic have a tax liability that applies to income from resources in the Czech Republic (§ 22).
(4) Pricers normally present in the Czech Republic are those who stay here 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 a taxpayer who receives income from sources within the territory of the Czech Republic from dependent activities and crosses the borders to the Czech Republic on a daily basis or in agreed periods of time for the purpose of carrying out such activities.
(5) Fees residing abroad who have been seconded by a foreign entity as experts (experts) with specific knowledge for the purpose of providing professional assistance to legal persons established in the Czech Republic or a permanent establishment (§ 22 (2)) and resident in the Czech Republic only for the purpose of such professional assistance are considered to be taxpayers with a tax liability relating only to income from resources within the Czech Republic.
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 tax is not applicable
(a) income obtained by the acquisition of shares under a special law, (1) by inheritance, issue of m2) or by donating real estate or movable property or property rights, with the exception of income accruing therefrom and excluding donations received in connection with the pursuit of an activity under Paragraph 6 or with an enterprise or other self-employed activity; the subject of tax on natural persons, on educational and health establishments and on facilities for the protection of abandoned animals, or on endangered species, but income is not derived from the acquisition of a gift in connection with the operation of such activities,
(b) loans and loans.
Exemption
(1) Exemptions shall be granted:
(a) income from the sale of an apartment or a residential building with a maximum of two apartments, including associated parcels, if the seller owned it and was present at the same time for at least two years immediately prior to the sale. The exemption shall not apply to income from the sale of such apartments or houses which are included in the commercial property and in which the taxpayer carries out business or other self-employed activity, within two years of the end of that activity,
(b) income from the sale of immovable property not referred to in (a), if the period between acquisition and sale exceeds five years; in the case of a sale of a property acquired by inheritance from a deceased who has been a direct relative or spouse in a series, the period of five years shall be reduced by the period during which the property was evidently owned by the deceased. The exemption shall not apply to income from the sale of real estate, including income from real estate referred to in paragraph 1 (g), which is included in the commercial property and which is the subject of the business of the taxpayer 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 contract for the future sale of real estate 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, except for securities acquired under a coupon privatisation, if the period between acquisition and sale does not exceed one year. The exemption shall not apply to income from the sale of movable property, including income from the sale of movable property referred to in point (g) of paragraph 1, which is the subject of or serves the business of the taxpayer or other self-employed activity, within one year of the end of the activity. This provision does not apply to capital gains (Section 8),
(d) the compensation received, the compensation for non-property damage, the performance of property insurance and the performance of liability insurance, except for payments received for loss of income and payments from the insurance of assets serving business and other self-employed activities or leasing;
(e) revenues from the operation of small hydroelectric power 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, from the advertising competition, from the advertising composition and the price from the sports competition with a value not exceeding 10 000 CZK, except for the price from the sports competition for taxpayers where the sport activity is a business (§ 10 (8)). However, the tender price and the similar price from abroad shall be exempt entirely if it has been donated in full by the beneficiary for the purposes set out in Sections 15 (8) and 20 (5),
(g) compensation received under special rules, (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 the 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, other than those from the insurance of a certain age exceeding the principal,
(m) performance provided by the armed forces to soldiers of basic (replacement) service, pupils of non-active schools and soldiers in reserve called for exercises under special regulations, 3)
(n) disciplinary fees paid to members of the armed forces and corps under special regulations, 3)
o) social benefits under the Law on certain service conditions of 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, 4)
(r) revenue from the transfer of members' rights to the cooperative or the transfer of participation in companies, if not for the sale of securities, if the period between acquisition and transfer exceeds five years;
(s) interest on deposits from building savings, including interest on State aid under special law, 4a)
(t) government bond interest income, 4d)
(u) the income generated by the acquisition of ownership of the apartment as compensation for the release of the apartment and the refund (severance) for the release of the apartment paid to the user of the apartment on condition that the refund is used for the provision of housing not later than one year following the year in which the refund (severance) was received, and the taxpayer notifies the tax administrator by the end of the tax period in which it was received.
(2) The exemption referred to in paragraph 1 (e) shall not apply where the taxpayer renounces the exemption by notifying the tax administrator not later than within the time limit for filing the tax return for the tax period in which those resources and equipment were put into service. the exemption in that case shall not apply to the transfer of ownership of such resources and equipment to another owner.
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 in the 15 days preceding the beginning or 15 days after the end of the tax period to which it belongs shall be treated as income generated in that tax period. If there is evidence of income that is economically attributable to both the past tax period and the following tax period, it shall be regarded as income of the tax period to which the taxpayer assigns it. The assessment of expenditure shall be treated mutatis mutandis. Income from dependent activities and functional benefits (Section 6) resulting from the taxpayer not more than 25 days after the end of the tax period for which they have been obtained shall be considered as income from that tax period. In the case of a taxpayer with income pursuant to Sections 7 and 9, account shall be taken of the stocks acquired in the calendar year preceding the year in which he began his activity. The same applies mutatis mutandis to other expenditure necessarily incurred in connection with the start of the activity.
(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.
(6) The income included in the tax base in the previous tax periods which have been repaid shall be reduced by the tax base in the tax period in which its recovery took place, provided that there is a legal basis for its recovery and that the income is not recorded in the taxpayer's accounting for the determination of the tax base (partial tax base) in accordance with § 7 and 9. In the case of amounts used as expenditure (cost) in previous tax periods for which there is a legal basis for repayment by the beneficiary, these amounts shall be increased by the taxable amount in the tax period during which the refund took place, provided that the refund was not recorded in the taxpayer's accounts for the determination of the tax base (sub-tax base) pursuant to § 7 and 9.
Revenue from dependent activities and functional benefits
(1) Revenue from dependent activities
(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 are also 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;
(d) the income of the taxpayer resulting from the exercise of the dependent activity or function, even if they are paid as compensation for the loss of such income by the payer for which the payer does not perform the dependent activity or function.
(2) The taxpayer with income from dependent activities and functional benefits 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 consist of another form of performance by the employer for employees who are liable for dependent income. The income shall also mean the amount by which the employee's remuneration for goods or services provided by the employer is lower than their normal price (Paragraph 3 (3)) or the amount referred to in Paragraph 6 (6) or the price charged by the employer for comparable goods or services to other customers.
(4) The income accruing from employers having their registered office or residence in the Czech Republic after the reduction provided for in paragraph 13 (a) is a separate tax base for taxation at a special tax rate (§ 36), in the case of income referred to in paragraph 1 (a) and (d) and in accordance with paragraph 10, the aggregate amount of which does not exceed CZK 2000 for the same employer in the calendar month. This is the case where the income generated by the employee is from an employer for which the employee does not apply tax-free amounts on the tax base for the calculation of tax advances under a special rule. (b)
(5) If the revenue referred to in paragraph 4 is derived from sources abroad, the tax base (sub-base of tax) shall be that provided for in Article 5 (2).
(6) If the employer provides a motor vehicle to the employee for use for both professional and private purposes, an amount of 12% of the purchase price of the vehicle in the calendar year shall be deemed to be the employee's income. An amount of 1% of the purchase price of the vehicle for each calendar month shall be regarded as the income of the staff member for the calculation of the advance payment, even if the vehicle is used only for part of the calendar month. If it is a hired vehicle, the purchase price of the vehicle shall be based on the original owner, even if a subsequent purchase occurs.
(7) They are not regarded as income from dependent activities and the subject of tax, other than income which is not subject to tax pursuant to Paragraph 3 (4), are not:
(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 shall be taxable income as 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 employer's employer in order to give them up on his behalf or the amounts by which the employer pays the staff member the declared expenses he has incurred for the employer, as if directly incurred by the employer;
(d) compensation for the wear of own tools, equipment and items needed for the performance of the work provided by employees under the Labour Code.
(8) Where the employer pays the employer's expenditure (compensation) referred to in paragraph 7 (b) to (d) a flat-rate amount, such expenditure shall be deemed to have been declared up to the flat-rate amount laid down in the special rules or the flat-rate laid down in the collective agreement or in the employer's internal rules, provided that the flat-rate amount has been established by the employer on the basis of actual expenditure calculations. The same procedure shall be followed by the employer in determining the flat-rate in cases where the conditions under which the flat-rate has been fixed have changed. If they are flat-rate using their own tools, equipment and items necessary for the performance of the work of the employee, which would otherwise be amortised, they shall be recognised only to the extent that the employer would apply depreciation of comparable tangible assets on a level playing field in subsequent years of depreciation.
(9) In addition to the income referred to in Section 4, tax exemptions are also granted:
(a) the amounts spent by the employer on training staff related to his business; the exemption does not apply to amounts paid to employees as compensation for income foregone,
(b) the value of meals provided as non-monetary benefits by the employer to workers for consumption at the workplace or in the framework of competitive meals provided through other entities;
(c) the value of non-alcoholic beverages provided as non-monetary benefits by the employer to workers for consumption at the workplace;
(d) non-monetary benefits provided by the employer to employees of the fund of cultural and social needs or of profit (income) after tax in the form of a possibility to use 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; However, if foreign recreation is provided, including foreign tours, a staff member shall be exempt from the value of non-monetary benefits in aggregate of a maximum amount of CZK 10,000 per calendar year. The performance of the employer shall also be assessed by the staff member for the family members of the staff member,
(e) the 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 engaged in public transport of persons to its employees and their family members in the form of free or discounted tickets;
(g) income of members of housing cooperatives from the personal performance of self-help cooperative housing construction not paid in cash but credited to their membership shares;
(h) income generated by the acquisition of employee shares under the special rule (6) 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)];
(ch) income from the dependent activity of the taxpayers referred to in Article 2 (3) from employers having their registered office or resident abroad, not including income from activities carried out in a permanent establishment (§ 22 (2)),
(i) the value of non-cash donations provided from the fund of cultural and social needs under the relevant regulation, 6a) for employers not covered by this regulation, the value of non-cash donations provided under similar conditions from social funds or from profit (income) after tax, up to an aggregate amount of CZK 2000 per year for each employee;
(j) cash performance for equipment and equipment provided to members of the armed forces and corps under special regulations, 6b)
(k) compensation for loss of service income (salary) granted to members of the armed forces and corps under special regulations, 6c)
(l) the value of the transitional accommodation provided as a non-monetary benefit by the employer to employees at the place of regular work (place of work) agreed in a contract of employment which is not identical to the place of residence of the employee;
(m) wage compensation paid under special rules 6d) equal to the difference between sickness insurance benefits;
(n) income generated by the return of employee shares (bonds) up to the amount of the difference between the nominal value paid and the selling value on issue, provided that the difference was taxed on acquisition before 1 January 1993;
(o) compensation for pension losses granted under the Labour Code for the period before 1 January 1989 and paid after 31 December 1992;
(p) the monetary advantage conferred on employees in connection with the granting of interest-free loans or loans with interest less than the normal level of interest by an employer from a fund of cultural and social needs or from a social fund;
(r) the monetary contribution to the renewal of granted in kind of uniform customs formalities;
(s) a special surcharge granted in foreign currency to members of the armed forces seconded to UN peacekeeping forces outside the territory of the Czech Republic 6e) for the duration of their stay abroad.
(10) Functional benefits are:
(a) the functional salaries of members of the Government, members of the Czech National Council and the salaries of the Heads of Central Government Authorities;
(b) remuneration for the performance of duties in the institutions of the municipalities, other local authorities, state bodies, civil and interest associations, chambers and other institutions.
(11) They shall not be regarded as a functional benefit and shall not be the subject of a tax on the reimbursement of expenses rendered in connection with the performance of a function to which entitlement under the special rules arises, except for the reimbursement of income foregone.
(12) Paragraphs 7, 8 and 9 shall apply mutatis mutandis to transactions provided in connection with the performance of functions.
(13) The basis of the tax (sub-base) shall be income from dependent activity or functional benefits, with the exception referred to in paragraphs 4 and 5, reduced by:
(a) the amount of social security premiums, the contribution to the national employment policy and the general health insurance premium, which is, under the special rules (21), payable by the employee; for staff covered by compulsory foreign insurance of the same type, contributions to such foreign insurance,
(b) 30% of the income from the dependent activity of the taxpayers referred to in Article 2 (5).
Revenue from business and other self-employment
(1) Entrepreneurship income is
(a) income from agricultural production, forestry and water management, 7)
(b) business income, 8)
(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) Revenue from other self-employed activities, in so far as they do not fall within the income referred to in Section 6, is:
(a) revenue from the use or provision of industrial or other intellectual property rights, including copyright rights, 9), including revenue from the issue, reproduction and dissemination of literary and other works,
(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 referred to in paragraph 7. 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 income 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 security contributions, the contribution to the State employment policy and the general health insurance premium which the member of a public company or an associate of a limited partnership shall pay, provided that such insurance is not paid as a cost to a public company or limited partnership.
(5) Social security contributions, contributions to state employment policy and general health insurance premiums paid by a public commercial company for members or limited partnership for Associates are exempt from tax for members or Associates.
(6) 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 the associates of the limited liability companies will report the 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.
(7) Revenue from contributions to newspapers, magazines, radio or television resulting from resources in the Czech Republic is a separate tax base for taxation at a special tax rate (§ 36), provided that the income referred to in paragraph 2 (a) is not more than CZK 3000 in the calendar month.
(8) If the taxpayer does not apply the expenditure evidently incurred to achieve, secure and maintain income, he may apply the expenditure, with the exception referred to in Article 12 (1), amounting to:
(a) 50% of income from agricultural production, forestry and water management, 7)
(b) 30% of the revenue referred to in paragraph 2 (a), with the exception of revenue referred to in paragraph 6;
(c) 25% of business income, other business income under the special rules and income referred to in paragraph 2 (b).
(9) Where the taxpayer applies the expenditure referred to in paragraph 8, 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-employed activities, except compulsory social security contributions and contributions to national employment policy and general health insurance premiums, which the taxpayer may apply in addition to the proven amount, but only to the amount of premiums calculated at the rate without increasing it from the maximum basis for such insurance in accordance with the special regulation. 21)
(10) Revenue from the sale of immovable property or movable property which are share-owned by spouses and in which the business or other self-employed activity has been carried out by at least one of the spouses and which has been the subject of the business or serve the business or other self-employed activity of at least one of the spouses shall be taxed on the spouses who have been engaged in the activity, provided that the property has been incorporated into the business of at least one of the business spouses. After the completion of the business or other self-employment activity, the procedure laid down in Section 10 (5) of the Act shall be followed.
(11) The revenue referred to in Article 7 (1) (d) shall not be regarded as revenue and shall not be the subject of a tax on the reimbursement of travel expenses paid to members of public commercial companies and to associates of limited liability companies up to the amount laid down in the special regulation. 5)
Revenue from capital goods
(1) The revenue from capital goods, in so far as they are not income 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 cooperative membership;
(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 in holding books, interest on funds in holding accounts;
(d) income from the deposit certificates and the equivalent deposits made to them;
(e) supplementary pension benefits with State contribution 9a) less the contributions paid and the State contribution to supplementary pension schemes;
(f) benefits from insurance in the event of a certain age or from supplementary pension insurance outside the social insurance fund, less premiums paid. Paragraph 10 (7) shall apply to the calculation of the tax base,
(g) interest and other income on loans and loans granted, interest on current account deposits and interest on the value of the amount of the deposit paid in the contractual amount of the members of public companies. Interest on current account deposits which are not intended for business under the terms of the Bank (spore accounts, foreign exchange accounts, etc.) shall be assessed in accordance with point (c),
(h) discount amounts for notes.
(2) The participation referred to in paragraph 1 (a) shall, for the purposes of this Act, be understood to mean a monetary and non-monetary contribution to the business.
(3) In addition, income from capital goods shall be considered as income from capital goods:
(a) the difference between the nominal value of the security [paragraph 1 (a)] or the deposit note [paragraph 1 (d)] paid and the selling value on issue; in the case of early buy-back, the buy-back price 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) to (f) and paragraph 3 (a), in so far as the revenue referred to in § 6 (1) or § 7 (1) (d) is not derived from resources within the territory of the Czech Republic, is a separate tax base for taxation at a specific tax rate (§ 36). If this income comes from sources abroad, it is, not reduced by expenditure, the basis of tax (sub-tax base).
(5) The revenue referred to in points (g) and (h) 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 from its employees or received by the bank from its employees under different conditions than from other natural persons are a separate tax base for taxation at a specific tax rate (§ 36).
(7) The supplementary pension benefit with a State contribution (9a) is considered to be the tax base for taxation at a specific tax rate after a reduction of the contributions paid and the State contributions to the supplementary pension scheme equally distributed over the period of benefit. If the period for receiving the benefit is not defined by the supplementary pension contract, the difference between the median length of the life 14) and the age of the supplementary pension participant at the time when the benefits start to be received for the first time shall be established.
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 immovable property (parts thereof), including apartments (parts thereof);
(b) income from the rental of movable property, other than occasional leasing provided for in Article 10 (1) (a).
(2) The income referred to in paragraph 1 resulting from the joint ownership of spouses shall be taxed only on one of them.
(3) The basis of the tax (sub-base of tax) is the revenue referred to in paragraph 1, less the expenditure incurred to achieve, secure and maintain it (Section 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 real estate, a separate tax base for taxation at a specific tax rate (§ 36).
(4) If the taxpayer does not apply the expenditure evidently incurred to achieve, secure and maintain revenue, he may apply it at the rate of 20% of the revenue referred to in paragraph 1.
(5) Where the taxpayer applies the expenditure referred to in paragraph 4, the amounts of the expenditure shall include all the expenses incurred by the payer in the context of the achievement of the rental income referred to in Article 9.
Other revenue
(1) The other revenue resulting from the increase in assets, in the absence of revenue under § 6 to 9, is 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, 10)
(e) received alimony, pensions (11) and similar recurring benefits, with the exception referred to in Section 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 3 (b);
(ch) prices from competitions and sports competitions with the exception referred to in § 4.
(2) The income referred to in paragraph 1 resulting from the joint ownership of spouses shall be taxed on one of them.
(3) In addition to the revenue referred to in Section 4, tax is exempt:
(a) the revenue referred to in paragraph 1 (a), provided that their total of the taxpayer does not exceed CZK 6000 in the tax year;
(b) prizes from lotteries, bets and similar games operated on the basis of permits issued under special regulations. 12)
(4) The basis of the tax (sub-base of tax) is income less expenditure evidently incurred to achieve it. Where the expenditure relating to each type 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.
(5) In the case of revenue referred to in paragraph 1 (b), the expenditure shall be the price resulting from the valuation of the item for which the debtor has proven to have acquired the case and, where the matter is inherited or donated, the price determined for the purposes of inheritance tax or donation. In the case of tangible assets written down in accordance with § 26 et seq., in which the taxpayer has been engaged in a business or other self-employed activity which has been the subject of the business or served for business, expenditure shall be the residual price referred to in § 24 (2) (b). 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 is also the amount evidently spent on the repair, maintenance or other evaluation of the case, including other expenditure relating to the execution of the sale, with the exception of expenditure under Section 25 of the Act. 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.
(6) 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 deposit is a property acquired or acquired less than five 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 depreciated, 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 regulation13) except for the share or part thereof which is a replacement under the special regulation.2)
(7) A pension under the special legislation11) is considered as a taxable base (sub-base) 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 14) 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.
(8) The revenue referred to in paragraph 1 (f) to (ch) resulting from resources within the territory of the Czech Republic is a separate tax base for taxation at a specific 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. For the taxpayers referred to in Article 2 (2) for whom the sport activity is an activity of business or other self-employed activity, the prices received from sports competitions shall be considered as revenue pursuant to Article 7. If this income comes from sources abroad, the tax base (the sub-base of the tax) is as defined in Section 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. In such a competition, if the price or total of the prices obtained by the same taxpayer exceeds CZK 20 000, it is revenue according to § 7. 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 social rights and the common costs incurred to achieve, secure and maintain them shall be distributed among the taxpayers according to their joint ownership shares.
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. If the revenue and expenditure are not distributed equally between the participants in the association, the participants in the association may use the expenditure to which they relate only as established.
(2) Income generated in the course of a business or other self-employed activity (Section 7) carried out with the cooperation of the other spouse and the expenses incurred in achieving, securing and maintaining them shall be distributed in such a way that the share attributable to the cooperating spouse does not amount to more than 50% if the co-worker spouse is the payer of social and health insurance premiums as a self-employed person; However, the amount attributable to the cooperating spouse, by which the income exceeds the expenses, may not exceed CZK 540 000 in cooperation for the entire tax period or CZK 45,000 for each month of such cooperation. In other cases of cooperation between the spouse and other household persons with a taxpayer, the income obtained in the course of business or other self-employment shall be distributed to the cooperating persons in such a way that their share of the common income and expenditure shall not exceed 30%; However, the total amount for the cooperating persons, by which the revenue exceeds the expenditure, may not exceed CZK 180,000 in cooperation during the entire tax period or CZK 15,000 for each month of cooperation. The income cannot be allocated to compulsory school children and to children and a spouse (spouse) if 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 established by the Social Treaty or by the Equal Work14a), this taxable amount shall be distributed to individual members in respect of which the taxable base (the sub-base of the tax) is constituted in accordance with Paragraph 5 (2), if the shareholder is a natural person or is included in the taxable 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 shall not be reduced by the gifts provided for in § 20 (4) or by the deductible item provided for in § 34 (3). 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. Similarly, the deductible item under Paragraph 34 (3) is assessed.
(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 each of the complements 14b) and shall constitute the taxable base (sub-base) in accordance with § 5 (2), if the complements are natural persons or the taxable base in accordance with § 23, if the complements 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 (§ 20 (4)) and the deductible amount provided for in § 34 (3) 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 master is considered as gifts provided by individual complementaries.
(5) In determining the taxable amount referred to in paragraphs 1 and 3, the profit or loss (Paragraph 23 (2)), adjusted for the transfer of a share of the profit or loss to members of a public commercial company or to associates of a limited partnership, shall be based on profit or loss.
Calculation of income tax achieved over multiple tax periods
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Regulation Information
| Citation | Full text of Act No. 75 / 1994 Coll., Act of the Czech National Council on Income Taxes (full text as shown by later amendments and additions) |
|---|---|
| Regulation Type | Declared full text |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 29.04.1994 |
|---|---|
| Effective from | - |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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