If an individual resides
in the Czech Republic for more than 183 days in
a calendar year, they are deemed to be resident
for tax purposes. This also applies where a person
has their home in the Czech Republic, works for
and is paid by a Czech company, or is a director
of a Czech registered company, or a private entrepreneur
conducting business in the Czech Republic.
A resident of the Czech
Republic must pay income tax on income derived from
within the Czech Republic and worldwide. Non-residents
will only pay income tax on income derived from
within the Czech Republic.
EU/EEA citizens do not
have to obtain a Residency Permit to stay in the
Czech Republic for more than 90 days, but should
report their presence after 30 days to the local
branch of the Foreign Police. However, a Residency
Permit may be advantageous for the purposes of purchasing
property and other legal matters. Non-EU/EEA citizens
must obtain a Residency Permit.
Cost
of Residence Document (approx)
Work
Permit Required
Work
Permit Authority
Obtaining a Residency Permit can
between two months and 180 days. There is normally
no charge for a Residency Permit but non-EU/EEA
citizens will be required to pay a fee of CZK2000
(EUR78 or USD114).
Citizens of the EU/EEA do not require
a Work Permit to work in the Czech Republic. Non-EU/EEA
citizens must obtain a Work Permit and a Residency
Permit. Non-EU/EEA citizens must pay a fee of CZK500
to apply for a Work Permit and must also have a
visa if no agreement is in place between the Czech
Republic and their country of origin.
Applications should be made at the
local Labour Office.
Personal
Income Tax
Corporate
Income Tax
Social
Taxes
Personal Income Tax is levied at
a flat rate of 15%. Both employees and self-employed
must make advance payments. The basic personal tax
allowance is CZK24,840 and further allowances apply
for a dependent spouse and children.
Corporate Tax is payable by companies
at the rate of 19% from 2010 (20% previously). Tax
on dividends is 15%, unless the transaction is between
two Czech companies, or between connected EU recipients
(subject to a 10% minimum shareholding threshold),
in which case the transaction will be exempt from
withholding tax. Income from interest is also charged
at 15%.
Social security contributions are
shared by the employer and employee, representing
contributions of 34% and 11% respectively, and 45%
of gross salary combined. Contributions cover pensions,
sickness insurance, unemployment benefits, and health
insurance.
Capital
Gains Tax
Property
or Wealth Tax
Stamp
Duty
There is no separate Capital Gains
Tax in the Czech Republic. Any gains by an individual
or a company are taxed as ordinary income. Profits
from the sale of a main residence are generally
exempt.
Real Estate Tax is charged on properties,
based on the value of the land and the buildings.
Tax on land is charged at CZK2 per square metre.
Tax on buildings is charged on a sliding scale per
square metre, depending on the use to which the
building is put, and its location.
There is no Stamp Duty in the Czech
Republic.
Other
Taxes
Withholding tax is charged at 15%
for transactions with non-residents for income received
from dividends, royalties and interest (except if
the transaction is between connected EU recipients
(subject to a 10% minimum shareholding threshold),
in which case the transaction will be exempt from
withholding tax. The standard rate of VAT from January
2010 is 20% (increased from 19% prior). A reduced
rate of 10% (up from 9% previously) is levied on
the supply of certain categories of goods and services.
I am facing a dilemma and would like to invite any reader to advise me.
I am a Brit who has lived outside UK since 1993- initially in Belgium (5 years) & subsequently in 4 African countries. After a year outside UK, the UK Inland Revenue confirmed my status as ‘non-resident’ for tax purposes and as I have had no income in UK, I have not completed a UK tax return for many years. I visit UK very rarely, normally for one or two weeks per year.
In May 2011, I was made redundent by my employers, who were downsizing. This coincided with a move to retire in the Netherlands, where I now have official residency (my wife is Dutch). I thought that, at 63 years of age, I would be unlikely to find suitable employment; in fact, I have not tried hard and had resigned myself to permanent (but slightly premature) retirement.
However, to my surprise, I have recently been approached (through a mutual acquaintance) by a company that wishes to use my skills on a project in the Isle of Man. The role, if & when confirmed, would see me working for about 10 days a month in Isle of Man, with about 5-7 additional days per month, working from home. Contract will be for about two years. The firm has asked me to confirm if I would prefer to be paid (and therefore be taxed) in Netherlands or Isle of Man, the idea being that I create a self-employment entity for this employment. I have no data on which to base a response. Given Isle of Man's traditional ‘low tax ‘environment, are there any benefits to declaring an income in IOM? Are there any Isle of Man residency implications? Netherlands takes a tax cut on total world wide income, and, as I have never had any contact with the Dutch authorities, I am reluctant to start such a relationship now. Do I have to declare income in both countries, with a breakdown prorata to the time spent in each jurisdiction? Should I declare income to UK Inland revenue?
If anyone has pertinent advice on these points, I’d be grateful to hear them.
Hi, I live in South Africa, and along with 2 business partners (one in South Africa and one in Ireland - all South African citizens though) are setting up a company that designs Smart phone applications. As they will be sold on the various platforms (none of which operate out of South Africa)we have to list our company as operating out of Ireland anyway. As such, we have decided to set up our company in the best tax country and are wanting info on whether Jersey or Malta is best? If anyone has some inside info we would really appreciate it!! Thanks!Mary
Just wondering if anyone 'on the ground', as it were, might be reading and able to help me...I was considering relocating my hairdressing business from the UK to Ireland before the economy started to go properly belly-up...now, not so much.
Are things as bad as they seem over there, or is it being over-hyped by the media? And is the government still keen to support small business people? Cos if not, I'll look elsewhere...
I am moving full time to France in Jan 2012 where I will be working as a freelance contract engineer to a number of Australian based companies. It is my choice to move to France not a work requirement. I will be renting my house out in Austrlalia and renting a house while I am in France. I hold both EU & Austrlain citizenshiip. I am married with 2 young children. Approx total family income $100k AUD. Do I pay tax in France or Australia or both ? Any help or guidance would be much appreciated.France move
Cyprus
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