Investor Presentaiton

As of January 2021, a special tax base with a rate of 15% has been introduced for selected types of non-Czech investment income (e.g., dividends and interest income from abroad). Business income or other self-employed income may be reduced by actual expenses or by an optional lump-sum deduction ranging from 30 to 80 percent of gross income. The annual lump-sum deduction is limited to a maximum of CZK 1.600.000 for income from agricultural business, CZK 1.200.000 for business income based on a trade license, CZK 600.000 for rental income and CZK 800.000 for other business income. Employees are subject to tax on income in all forms, whether in cash or in kind. In particular, benefits, such as the provision of a car available for both business and private use, are taxable. It is not possible to deduct an employee's social security and health insurance contributions from the tax base. However, items such as mortgage interest, payments for supplementary pension insurance with state support, private life insurance premiums, and donations can be deducted if certain conditions are met. Employer contributions to defined private pension or life insurance schemes up to CZK 50.000 per year are tax-free for the employee. The Czech pension system comprises two pillars - a mandatory pay-as-you-go pension system run by the government (the first pillar) and a voluntary additional pension system administered by commercial insurance companies (the second pillar). There are no special provisions dealing with employee share option schemes, and gains realised on exercising an option are regarded as taxable income. It is generally accepted, however, that no gain arises on the granting of an option if the option is generally not transferable or tradable and the employee is not a legal owner of the underlying share. 84

View entire presentation