Czech Republic Taxation of Employee
Many of the expenses incurred by either an individual or a company are tax deductible on the assumption that they are supported by the appropriate documents. Tax relief is granted in certain circumstances.
The relief may be expressed as a tax deduction when the relief is granted by reducing the amount of income that is taxable or by the grant of a tax credit when the benefit is deducted directly from the tax due.
- Depreciation of fixed assets (see above)
- Business - related insurance premiums (property insurance and so forth).
- Employer's contributions to social and medical benefits, as well as the employee's contribution to an old-age pension which is deductible to a limit.
- Provisions in accordance with the various statutes, such as provisions to an insurance company against foreseeable claims and more.
Permanent residents are entitled to the following annual relief:
- A taxpayer's annual exemption - CK 30,840.
- Exemption for a non-working wife - CK 24,840.
- Child allowance- 15,204 for the first child.
- Exemption for those receiving a 100% disability allowance - CK16,140
- Exemption for high school / university students - CK 4,020.
- Contributions to the public benefit, to 15% of the tax base.
- Interest on mortgages (subject to certain conditions).