If you’ve moved to the Czech Republic for work, you might be interested to hear this: The latest data from the Czech Statistical Office (ČSÚ) sourced from the Ministry of Labour and Social Affairs shows that over 940,000 foreigners were working in Czechia by the end of 2023. Results includes both employees and entrepreneurs with a Czech trade license (živnostenské oprávnění). Their number has grown significantly compared to the previous year, and foreigners now make up 18.6% of all those employed in the Czech economy. But do you know which tax benefits you can claim as a foreigner? In this article, we’ll explain it in detail.
What you’ll learn from this article:
Who is a Czech tax resident and who isn’t
What you are entitled to as a tax resident
Tax rights of foreigners without resident status
Tax resident vs. non-resident
A foreigner becomes a Czech Republic tax resident after obtaining a permanent place of residence in the country or living in Czechia for at least 183 days a year. The place of residence is considered to be a home you own or rent, available for your use at any time.
These are the main criteria for determining tax residency. If you meet them, you are obliged to declare all your income in Czechia. This applies to income earned both in Czechia and abroad. If necessary, you can request a certificate of Czech tax residency from the tax office.
If you don’t live in the Czech Republic (or are here for less than 183 days a year) but receive income from Czechia, you are considered a tax non-resident. This also applies to students, even if they are in Czechia for more than 183 days. You are obliged to declare income earned within the Czech Republic.
Tax benefits for residents
If you are a tax resident, you can take advantage of the following benefits:
- Basic tax discount for the taxpayer (applies to one employer)
- Child discount
- Spouse discount
- Disability discount
If you are a foreigner and a tax resident of Czechia, you are entitled to the same benefits as Czech citizens.
Opportunities for tax non-residents
Even as a tax non-resident, you can claim the basic tax discount for the taxpayer with a Czech employer. To do this, you must sign the form “Prohlášení poplatníka k dani” for the relevant tax period.
Other benefits, such as the spouse or disability discount, can only be claimed if you meet the following conditions:
- You are a citizen of another European Union or European Economic Area country,
- 90% of your total income comes from Czechia.
To claim these benefits, you must submit a tax return.
Do you have questions about staying in the Czech Republic? Or do need help with administration and want to find out about your options?
Visit us at the YesPojisteni.cz branch office in department store Máj in center of Prague. You can also email us at maj@yespojisteni.cz or call us at +420 790 285 180.
We are looking forward to seeing you!
