Authors: David Krch, Josef Žaloudek, Martin Bureš

We would like to remind you that the “tax package” for 2021 in the Czech Republic has been published in the Collection of Laws under No. 609/2020 Coll., bringing about relatively significant changes to the personal income tax (“PIT”).

In this reminder, we would like to briefly emphasize just one of them: where we were accustomed to applying a flat 15% PIT rate, the new PIT rate is now applied up to 23%. The threshold is annual and is calculated as 48 times the average monthly wage (for 2021 this threshold is approximately CZK 1,700,000), while the PIT base above this threshold will be newly taxed at the tax rate 23%. This applies, for example, to certain interest income, rental income, the sale of cryptocurrencies or property, and various other “one-off” income, provided that this income is not exempt from PIT.

Could any of the above-mentioned income “above the threshold” apply to you? Do not hesitate to contact us. Our experts will assess your specific situation and together we will find the most effective solution.