Czech Republic - China Double Taxation Treaty

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. 

 

 

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.

 

The treaty 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. 

 

We propose you work with our accountants in Czech Republic if you have a business in this field, and benefit from a wide range of services. Payroll is necessary for calculating and delivering salaries to employees' accounts, and with bookkeeping, you can monitor any financial entry and exit in the company. Annual financial statements are important and can be prepared by one of our specialists who also collaborate with the relevant financial institutions.

 

 

Chinese investors 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. 

 

Businessmen who need further information on the Czech Republic- China double taxation agreement can address to our team of Czech company incorporation representatives for assistance.