The Czech Republic is currently one of the most developed countries in Central Europe. This state of affairs owes its existence to modern state institutions and a simple tax system. It is a country having a friendly attitude to entrepreneurs and, furthermore, possessed of great development potential. When planning to set up a company in the Czech Republic, familiarise yourself with the local tax law. Check below what the taxes are like in the Czech Republic.
Taxes in the Czech Republic
The CIT rate is 19% and applies to all profits from business operations, including capital gains from the sale of shares. Companies being Czech residents are required to pay CIT on the entire income worldwide. Non-resident companies are required to pay CIT on income earned only in the Czech Republic. The Czech Republic does not have a separate capital gains tax. Also, local corporate income taxes do not apply. The standard VAT rate is 21%.
Taxes in the Czech Republic – pay attention to
The Polish-Czech agreement on the avoidance of double taxation defines the concept of a plant in such a way that almost any activity in the Czech Republic may constitute a plant in the Czech Republic for a foreign company. It is worth remembering this when planning expansion into the Czech Republic.
In the field of international taxation, we will provide
International tax planning consultancy
Consultation for determining the appropriate tax residence
Full support in the process of obtaining the right tax residence
Intermediation in the contacts with Polish and foreign fiscal authorities
All kinds of support for international tax settlements
Moving abroad is a highly significant step in life. Tax issues should come as the last matter to be considered. Think about where you would like to live, where your children should go to school and where you want to run a business. Only after honestly answering these questions, can you decide which country will be the most suitable for all your needs.
WHAT FORMALITIES DO I HAVE TO COMPLETE WHEN MOVING OUT OF POLAND?
There are many formalities, and they depend primarily on the current situation. The aim should be to completely sever all ties with Poland.
DO I HAVE TO FILE A TAX RETURN IN POLAND AFTER MOVING AWAY?
Tax returns in Poland are submitted by Polish residents or persons earning income in Poland who are residents of another country. It all depends on whether you have successfully relinquished your Polish residence. And if you have, it also depends on the kind of income you earn in Poland.
WILL I PAY TAX IN POLAND BECAUSE OF RELOCATING THE COMPANY ABROAD?
The question is about the broad subject of exit tax. First of all, you need to verify what moving the company abroad actually means. It can be both the relocation of the registered office of the company and the personal move of the entrepreneur – a natural person. The tax implications of both situations may be significantly different.
CAN I TRANSFER THE COMPANY'S ASSETS TO THE DESTINATION COUNTRY TAX-FREE?
The general limit below which you do not have to pay exit tax in Poland is PLN 4 million. Nevertheless, it is always necessary to check this issue because the transfer of the company’s assets to the destination country will not always mean the same thing.
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