Czech Republic is an exciting opportunity for expats seeking a high quality of life, rich history, and central location in Europe. Known for its fairy-tale architecture, vibrant cities like Prague and Brno, and affordable cost of living, the Czech Republic has become a top destination.
In this guide, we’ll walk you through everything you need to know about relocating to the Czech Republic from a personal tax perspective, including tax residency, income tax, special tax regimes and tax return obligations.
TaxPilot recommend that you organize your affairs in good time to get ahead and make the most of favorable tax treatment while making sure you’re meeting your tax return obligations.
Czech Republic follows a residence taxation model. If you are resident, you will pay tax worldwide incomes. If you are non-resident, you will pay tax on local incomes only.
if you spend more than 183 days in Czech Republic during the tax year.
if your main residence is located in Czech Republic during the tax year.
Tax on property and share sales
Tax on value of owned assets
Tax on assets passed to heirs
Tax to contribute to state welfare
If you receive incomes overseas while you are living in Czech Republic, you may find the source country, as a starting point, continues to tax the income which may cause double taxation unless you are using special tax regime.
Double taxation agreements can be used to mitigate double taxation and receive tax free income. As such, the more double taxation agreements a country has, the better, as agreements will ensure you’re not taxed twice and even better, ensure your income is tax free.
At present, Czech Republic has 99 double taxation agreements signed.
