The 2023 tax package including the windfall tax was published in the Collection of Laws

The act amending the area of taxation (i.e. the 2023 tax package), including the newly implemented windfall tax, was published in the Collection of Laws under no. 366/2022 Coll. on 2 December 2022 and will become effective as of 1 January 2023. Let us summarise the most important changes we will be facing as of the new year.

The complete text of Act 366/2022 Coll. is available on the website.

Corporate income tax

  • The amendment extends the possibility of applying extraordinary tax depreciation for selected assets until 31 December 2023.
  • Specific situations are covered, such as the issue of immovable cultural monuments, fulfilment of the condition regarding the period of use of an asset for the purposes of tax deduction to support education of students or special tax exemption of gratuitous income, namely of housing cooperative, upon the transfer of real estate from the municipality under defined conditions.
  • A major change is the introduction of windfall tax, which will affect the banking and energy sectors – you will find more information in our article.

Personal income tax

  • A new amendment to the lump sum tax regime is implemented, where taxpayers can use three tax ranges – you will find more information in our article.
  • The limit of taxable income that is subject to general obligation to file a personal income tax return will be increased from the current CZK 15 thousand to CZK 50 thousand per year.
  • The limit will also be increased for employees who may generate other income outside the employment up to CZK 20 thousand per year without the obligation to file a tax return. The current limit is CZK 6 thousand.
  • Furthermore, specific cases of transfer of an immovable asset from a municipality or special remuneration for election committee members will be exempt from tax.

Value added tax

  • The most important change is the increased limit for the obligatory registration of a VAT payer from CZK 1 million to CZK 2 million – in this respect, we would like to draw attention to the special transitional provisions for the deregistration of the taxpayer, which can have retroactive effect from 1 January 2023 for the purposes of the lump sum tax.
  • Amendment to sanctions and deadlines for control statements.

If you have any questions, please contact us any time.

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