Czech Republic

The Czech Republic has progressive personal income tax (PIT) rates (with two tax brackets applicable to almost all types of income) as follows:

• Basic tax rate of 15% for annual gross income up to 1,582,812 Czech koruna (CZK).
• Increased rate of 23% for annual gross income over CZK 1,582,812.

Certain types of capital income (such as dividends and interest income from bonds) are subject to the 15% tax rate.

An important change that will come into effect from 1 January 2025 is limitation for tax exemption of capital gains from sale of shares in companies. Until the end of 2024, a full tax exemption of capital gains from sale of shares is available to individuals if the individual owned the shares for a period exceeding three years for shares having the form of securities and five years for shares in other companies. From 2025, the maximum annual amount of income (i.e. the sales price of the shares) that can be tax exempt will be limited to CZK 40 million.