Investor Presentaiton
Taxation of income from
inheritance and gifts
From 1 January 2014, gift and inheritance taxes
have been abolished and the taxation of such
income is now governed by the Income Taxes
Act. Gifts are taxable unless the donor is aqual-
ifying spouse or close relation and are subject
to a flat rate of 15 percent for individuals and
19 percent for companies. No tax is payable on
inherited property.
Tax on immovable property
Tax on immovable property is payable by own-
ers of immovable property situated in the Czech
Republic. This tax is generally small compared
with other developed countries. Different rates
apply to land and buildings.
The property tax on buildings used for busi-
ness purposes is based on the area of the build
ings, using the rates below.
Residential and agricultural
Industrial
Other business
CZK/m2
2
10
10
An additional charge of CZK 0.75 per square
metre is levied for each storey (above the
ground floor) of a building used for business
purposes if the area of the storey exceeds one
third of the area of the ground floor.
Real estate tax on agricultural land is 0.75 per-
cent of the deemed value. Special rates apply
for forests, lakes and ponds. For other types of
land, the tax is based on the area, and the rate
is CZK 2 per square metre for building plots,
CZK 5 per square metre for improved land sur-
face used for business purposes and CZK 0.20
per square metre in other cases.
For some types of property, the rates are mul -
tiplied by a coefficient ranging from 1 to 5
depending on the location of the property. In
addition, the tax can be increased by another
coefficient, varying from 2 to 5, based on the
decision of the relevant municipality.
International tax issues
A company's registered office is the place
where the effective management of the com-
pany is located. Companies with their regis-
tered office in the Czech Republic are subject to
Czech tax on their worldwide income and are
referred to as Czech residents.
Other companies (non-residents) are subject
to tax only on their Czech source income, sub-
ject to the provisions of any double taxation
treaties.
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