who are interested in opening a company in Czech Republic
can benefit from the stipulations of the treaty for the avoidance of double taxation
signed by authorities of the both states. The double taxation treaty (DTA)
was signed in 2007 and it stipulates the way in which income taxes
will be imposed to natural persons and legal entities operating on one of the two markets. Our team of Czech company incorporation specialists
can provide assistance on the main provisions of the treaty
Taxes covered by the Czech- Austrian DTA
is applicable for income and capital
, such as the total income, total capital, elements of the income, or taxes on income
which can derive from movable or immovable property. According to Article 2(2), the Czech Republic- Austria DTA
is also applicable to taxes
from wages and those applicable to capital appreciation.
Austria imposes the following taxes:
• the income tax;
• the corporation tax;
• the land tax;
• the tax applicable to agricultural/forestry companies;
• the tax on vacant plots.
Czech Republic imposes the next taxes:
• the income tax applicable to natural persons;
• the income tax applicable to legal entities;
• the tax on immovable property.
It is important to know that the differences between the taxes
applied by each country are an effect of the local legislation but, according to Article 2(4) of the convention, the contracting states are obliged to apply the provisions of the DTA
to similar taxes prescribed by the local law; our team of Czech company formation representatives
can provide more details on this matter.
Provisions of the Czech Republic – Austria DTA
According to the stipulations of the convention, a resident person of a contracting state refers to any person who, under the rules of the state, is liable to taxes in that particular state.
Austrian companies operating in Czech Republic
are taxed under the laws of the state in which the companies have their headquarters and they are liable to taxation in Czech Republic
only in respect to the income gained in this country. At the same time, it is important to know that Czech authorities
can tax Austrian companies
only if they operate through a permanent establishment.