is a state in which the level of taxation
is generally lower, compared to other countries from its vicinity. Both natural persons and legal entities can benefit of various tax deductions and incentives
applicable in Czech Republic
; if you want to find out to which deductions you are entitled to, our Czech company formation specialists
can provide you with further information.
Czech tax exemptions
Businessmen interested in the tax legislation
applicable to companies in Czech Republic
should know that the local authorities offer a set of rules and regulations advantageous to foreign businesses, which can be emplpoyed as tax optimization solutions
. One major tax deduction
applicable to foreign companies
is related to the standard corporate rate
. Although local and foreign companies are imposed with the same taxation system
, in the case of corporate tax
, the local authorities impose a corporate tax of 15%
on foreign sourced income , compared to the standard corporate tax of 19%.
Antoher tax minimzation solution
can be used by companies with operations in several sectors which are 100% exempt
of Value Added Tax (VAT)
, which is currently applicable at the rate of 21%. As such, business activity in the field of exports or international transportation is not required to pay any VAT.
Companies and other legal entities which provide services in several domains are also full exempt
from paying the VAT
; services in the broadcasting industry, postal industry, insurance, education and gambling do not have to pay this tax; our company formation agents
can provide you with further information on this matter.
allows a series of corporate tax deductions
for operating expenses. Also, charity donations can be deducted by the company only if the total value of the donation is above CZK 2,000; the tax can be reduced up to 10% of its standard rate.
Other tax minimization options companies can use is the deduction of the costs of fix assets and lease payments. Expenses incurred by the research and development department can also be deducted under several conditions, which can be explained by our company formation specialists.