The Czech Republic and China
have concluded a treaty for the avoidance of double taxation
, thus offering the possibility to further develop the trading and investment relations
between the two states. As such, the tax residents of one contracting state conducting business activities in the other state will be taxed only once for their income, as stated by the regulations of the double taxation treaty (DTA)
signed by the representatives of the two states. Our team of Czech company incorporation specialists
can provide an in-depth presentation on the provisions of the agreement,
as well as on the main benefits Chinese investors
are entitled to when conducting businesses in Czech Republic
Taxes under the Czech Republic- China DTA
Chinese investors operating on the Czech market should know that the DTA is applicable only to the residents of the two countries. A resident is a natural person or a legal entity which is paying income tax in the country where his or her residence is situated.
According to the stipulations of Article 2 of the treaty, China will impose the following taxes:
• the individual income tax;
• the enterprise income tax.
Czech authorities will consider the following as being income taxes:
• the tax on income of individuals;
• the tax on income of legal persons.
stipulates that the contracting states
will apply similar taxes
, but some difference may arise due to the local legislation. In the situation of China and Czech Republic
, the countries are applying identical taxes referring to the income of tax residents
; our team of Czech company formation agents
can offer more details on the matter. The provisions of the treaties are applicable to the entire national territory of the contracting states.
Conducting a Chinese business in Czech Republic
who want to open a company in Czech Republic
should know that they will be taxed in this country only for the income they incur through their Czech operations
and only if the business is carried out through a permanent establishment. This refers to a fixed place of business, including a construction site, in which the operations last for a period longer than 12 months.