5 typical tax mistakes expats make in Czechia, and how to avoid them

Life in Czechia has plenty of rewards, but when tax season rolls around, even the most organized expats can feel lost in a sea of forms, deadlines, and rules written in another language. And while many assume they only need to file taxes if they’re Czech residents, that’s not quite true.

“Everyone living in Czechia for most of the tax year who earns income, whether from a trade license, rental property, stocks, or cryptocurrency, is required to file an income tax return,” explains Jaroslava Mehessen at HJ Taxes, a specialist firm that helps and guides foreigners in successfully navigating the Czech tax system. 

Here are five common mistakes expats make, and practical steps to stay compliant.

To be a Czech tax resident or not to be—that is the question. Well, more of a trick question, because according to Mehessen, “You do not need to be a Czech tax resident to be required to file an income tax return, property tax return, or VAT.”

Many expats are confused about how their residency affects their tax situation, but under EU law, you must pay income tax in the EU country where you spend more than 183 days in a year. That law applies even if the days are not consecutive, and it especially applies to individuals with permanent residency. 

As Mehessen points out, tax liability can also depend on where your main economic interests lie, such as your job, business, property, or family. If you’re still not sure, consulting a qualified tax advisor can help you understand where you owe taxes to avoid penalties.

Czech income tax deadlines vary depending on the method of filing. Paper returns are due by April 1, and electronic submissions by May 1 or May 2 depending on how the calendar days fall. If you file through a registered tax advisor such as HJ Taxes, the deadline extends to July 1, giving you valuable extra time to prepare your return correctly.

And even if you do meet the official deadlines, it’s absolutely crucial to double-check your submission. “Many expats accidentally leave out minor income sources or supporting documents, which can trigger automatic late-filing penalties or delays in refunds,” Mehessen explains. 

Other taxes, such as property tax, have separate deadlines. Missing these can result in penalties, so it is essential to track all due dates, or just let a professional do them for you.

Going through a tax return doesn’t need to be all bad, especially when you realize that Czechia’s tax system often provides generous deductions, write-offs, and credits.

However, finding out what these are (and whether you’re eligible) isn’t easy. “Can I pay less tax if I’m married or have a child? Do standard taxpayers get any tax credit? How do I claim any benefits?” are questions tax advisors hear very, very often.

Mehessen weighs in: “There are two ways to make sure you’re claiming everything you can. One is to research and learn about them yourself. The other is to work with a firm that explains every single possible claim, and identifies which apply to you.”

Top deductions often include mortgage interest, child bonuses, spousal allowances, and charitable donations, she adds. Knowing what you can claim can save you tens of thousands of crowns each year.

Whether you report flat-rate or actual expenses, documentation is essential. Failing to manage your accounts (whether business or personal) and track what you spend and earn can cause massive complications down the line. 

Even if you’re an employee on a stand work contract (hlavní pracovní poměr, or HPP), you still benefit from retaining documentation in case your work situation changes.

“The Tax Office may well audit your return,” Mehessen emphasizes. “They will review all related documents to ensure everything was filed correctly, including those nice, supporting deductions. If something isn’t properly documented, it simply can’t be accepted.”

Keeping records ensures that you can justify every line on your return. For foreigners with multiple income streams or transactions across different countries, a tax-specialist firm makes tracking your finances that much smoother. 

The desire to save money is understandable, especially for freelancers on a trade license (živnostenský list). But trying to handle your taxes (and everything that comes with them) on your own can easily backfire. Mistakes, missed deadlines, or incomplete filings can cost more than professional help ever would.

“For self-employed workers and small business owners, going it alone is a potentially costly decision,” Mehessen explains. “Sites exist which can help you ‘do it yourself’, but they’re risky. Income tax, and taxes in general, are very complex, and it’s worth having an expert to help you.”

That level of support can sometimes go beyond tax and financial services. In Mehessen’s experience, her company has offered additional assistance in other areas of expat life.

Taxes in Czechia can feel confusing, but careful attention to deadlines, filing rules, deductions, and documentation keeps you safe. 

By following these steps or partnering with an expert, you can avoid fines, optimize, and focus on enjoying life as you should.