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Czech Republic: Worked Example of Tax on Rent

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Last Updated: Oct 02, 2006

Tax Example: Rent

Non-resident couple's joint monthly rental income1 €1,500 €6,000 €12,000
Annual Rental Income 18,000 72,000 144,000
Less Personal Costs2 (3,600) (14,400) (28,800)
Less Standard Costs (20%)3 (1,345) (1,345) (1,345)
= Taxable Income 13,055 56,255 113,855
Income Tax Rates4
Up to CZK109,200 15% 579 579 579
CZK109,200 – CZK218,400 20% 579 579 579
CZK218,400 – CZK331,200 25% 997 997 997
Over 331,200 32% 430 14,254 32,686
Annual Income Tax Due €2,585 €16,409 €34,841
Tax Due as % of Gross Income 14.36% 22.79% 24.20%
Thanks to:
KPMG Česká republika, s.r.o.  BDO Tax s.r.o

DISCLAIMER: The information contained above is marketing material only and is not written tax advice directed at the particular facts and circumstances of any person and should not be relied upon. We encourage you to discuss your particular situation with us or an independent tax advisor. This information was last updated on October 2, 2006.

Notes

1 The property is jointly owned by husband and wife, but then taxed separately (50% upon each partner).

2 The 20% standard deduction is applicable for 2005.

3 The personal allowance is based on the 2005 value of CZK38,040. Exchange rate as of 02 October 2006: €1 = CZK28.2835.

4 Exchange rate as of 02 October 2006: €1 = CZK28.2835.

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