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Czechia has some of Europe’s lowest tax burdens, making it an attractive choice for expats to become taxpayers.
However, if you’re a remote worker or split your time between your home country and Czechia, you may wonder which tax office you should pay—and exactly how much.
Navigating the country’s tax bureaucracy can be tricky for locals, and often seemingly impossible for a non-Czech-speaking expat. We asked Eduard Malyarchuk, CEO of Nawi Europe, a company specializing in legal, tax, and banking solutions for expats, some of the most frequently asked questions about tax residency for foreigners living abroad.
Here’s everything you need to know about paying tax in Czechia.
How do I know if I’m a tax resident in Czechia?
Czechia’s Income Tax Act (No. 586/1992 Coll.) defines who should be taxed in (or outside) Czechia.
As per EU law, you pay income tax in the EU country where you spend more than 183 non-consecutive days per year (this includes those with permanent residency), or where your main economic interests (work, business, property, family) are based.
You’re considered a tax resident there if you meet those criteria in Czechia.
It’s not only about time spent in the country
The “183-day rule” is often the most helpful factor in determining whether you’re a Czech tax resident. But other factors are also at play.
According to the Income Tax Act, if you own a permanent home in the Czech Republic, which can be owned or rented, and intend to reside there permanently, then you are a Czech tax resident.
You can also spend over six months in one year and not necessarily qualify as a tax resident. This is the case if somebody is present in the Czech Republic solely for study or medical treatment.
Additionally, while having permanent residency qualifies you as a Czech tax resident, possessing a long-term visa does not do so.
How can I prove, or dispute, my tax residency?
If you’re unsure about your tax obligations in Czechia or if the country’s Financial Administration questions your residency, you may need to provide supporting evidence.
This could include passport stamps or travel records (especially from outside the Schengen Zone), Czech rental or property agreements, local bank statements, utility or mobile contracts, and proof of enrollment in the Czech public health system.
If you believe your primary residence is elsewhere, a tax residency certificate from your home country or another jurisdiction can help support your claim. A trusted tax advisor is the surest way to avoid confusion and get all necessary documentation.
Eduard Malyarchuk, CEO - NAWI Europe a.s.“Many expats discover that becoming a Czech tax resident simplifies their life and often saves them money—if they know how to approach it properly. In practice, we often deal with people who fall into double taxation simply because they underestimated their obligations.”
What does this mean for tax liability?
Being a Czech tax resident implies a worldwide tax liability. This means the individual is subject to Czech income tax on income earned within and outside Czechia.
However, Czechia’s Tax Code (No. 280/2009 Coll.) underlines how double taxation is generally mitigated through tax credits or exemptions defined in double taxation treaties (DTTs) that Czechia has with numerous other countries. It currently shares around 100 of them with nations globally.
The full list of countries with DTTs is on the Ministry of Finance website, or you can ask a tax advisor for details related to your situation.
I’m a tax non-resident living in the Czech Republic. Do I still need to pay tax?
It depends on your income and the type of work contract. You will be taxed only on income that has its source in the Czech Republic.
Additionally, owning a property in Czechia—but not living in it—also means you’ll need to pay real estate tax, even if you’re not a Czech tax resident. You would also need to declare and pay tax on rental income if you lease your owned property out.
Why Czech tax residency is beneficial
Czechia has a very favorable and appealing tax environment for residents and investors. In fact, a study—backed by World Bank data—found that Czechia has Europe’s third-lowest tax burden overall.
Most taxpayers pay just 15 percent. The upper rate of tax—if you earn roughly four times the average wage—is 23 percent.
This top rate is much lower than in many EU countries. For example, top earners in Slovenia pay 50 percent, in Belgium over 53 percent, and in Austria up to 55 percent.
Czechia’s lower rate of 15 percent also compares well to other countries: it is much lower, for example, than in Slovakia (19 percent), Croatia (20 percent), and Italy (23 percent).
Navigating a different country’s tax code is no easy task. However, understanding the Czech tax system better—and being a tax resident—can bring fruitful financial benefits.
The bottom line
Consulting a tax advisor familiar with Czech and international law is the smartest way to avoid headaches and severe financial penalties and to save money.
Whether you’re relocating to Czechia, living here part-time, or working remotely with income from multiple countries, they can help you determine your tax status, fully utilize any applicable DTTs, and explain the law.
