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Corporate Tax in Czech Republic

Corporate Tax in Czech Republic

The corporate tax in Czech Republic designates the tax applicable to the income of a company operating on the local market. All companies registered in Czech Republic which carry out commercial operations are required to comply with the tax regulations imposed by the local authorities and our team of Czech lawyers can offer assistance on the procedures that must be completed in this sense. 

Taxation on corporate income in Czech Republic  

Companies performing commercial activities are required to pay a set of taxes on the income deriving from their operations on the Czech territory. A company in Czech Republic will have to register for value added tax (VAT), as well as for social security and corporate tax

The corporate tax in Czech Republic was lowered several times in the last decade and, since 2010, it is applicable at the rate of 19%. 

The tax is applied on the income obtained by the Czech companies, as well as for other types of legal entities, for example, the branches of a foreign company operating in this jurisdiction. 

Depending on the legal entity of the business, the corporate tax may be applicable to other types of incomes. In the case of a general partnership in Czech Republic, the corporate tax is imposed on the share of profits obtained in the respective entity and our Czech law firm can offer further information on this matter. 

Regulations referring to the Czech corporate tax 

Companies registered in Czech Republic are imposed with the corporate tax for their income deriving from overseas sources. In the case of foreign companies operating in this country, the tax is imposed only for the income obtained throught the business activities carried out in Czech Republic

Investors who want to open a company in Czech Republic should know that the corporate tax is also applicable to the capital gains deriving from the sale of the company’s shares

However, we mention that the corporate tax can also be applied at reduced rates, ranging between 0% to 15%, but only in certain conditions. 

Businessmen are invited to contact our attorneys in Czech Republicfor more details on the corporate taxation