Czech Corporate Income Tax: rate, calculation and tax return

What is corporate income tax?

Corporate income tax, also known as CIT, is a direct tax paid by companies and other legal entities on their profits. It is paid once a year based on a tax return (if the tax liability is higher, interim advance payments are also made in the following period).

Corporate Income Tax Rate

Compared to previous years, the basic tax rate increased from 19% to 21% in 2025 . Therefore, profits for 2024 and beyond are taxed at a rate of 21%.

Who pays corporate income tax?

Corporate income tax is paid by companies that are headquartered in the Czech Republic or actually manage their business from here. In such cases, these are so-called tax residents, who must pay tax in the Czech Republic on all their income derived from both domestic and foreign sources.

Conversely, companies with their registered office and management abroad are subject to only limited tax obligations in the Czech Republic, as they are considered non-residents for tax purposes. Thus, they are taxed domestically only on profits generated within the Czech territory. This applies, for example, when a foreign company rents office space in Prague or operates a restaurant there.

Tax Registration

Every legal entity—whether a business corporation, association, foundation, cooperative, or other entity—mustregister for corporate income tax within 15 days of its establishment.

You can find the corporate income tax registration form on the Financial Administration’s website. Once completed, simply submit it to the tax office with jurisdiction over your company’s registered address. The tax office will send a confirmation of registration to your data box within 30 days and will also assign a tax identification number (TIN).

Procedure for calculating corporate income tax

In short, corporate income tax is calculated as follows in the tax return:

Revenue, income, costs, expenses... How do they differ, and what is taxable?

To correctly calculate corporate income tax, you need a solid understanding of the legislation that sets out the rules and conditions, including a wide range of exceptions. To avoid unnecessary problems, we recommend using the services of an accountant or tax advisor, or at least always consulting with experts about your situation.

The key is to know that corporate income tax (CIT) calculations involve revenues and costs, not income and expenses—and that they are not the same thing. Each arises at a different time and may occur in a different order.

• Revenue arises, for example, when you issue an invoice for your services or goods. Income, on the other hand, arises when the money is actually received into your account or cash register.
• An expense can be, for example, an invoice received for goods. An outlay arises only at the moment of payment, whether it occurs before or after the invoice is received.

Also note that not all revenue is taxable, and not all expenses can be deducted from your tax base.

• Taxable income may include, for example, revenue from your business activities (invoices issued for services, sale of goods...), from rentals, interest, or dividends. However, some types of revenue are exempt from tax by law or are not subject to tax at all.
• Tax-deductible expenses must be demonstrably related to business operations and serve to achieve, secure, or maintain taxable income. These may include, for example, the purchase of goods, wages, utility bills, or accounting services. However, non-tax-deductible expenses (Section 25 of the Income Tax Act) will not reduce your tax liability.

When and how should a company file its tax return?

Business entities must always file a tax return—regardless of whether they earned any income or are currently engaged in business activities. Even if they had no revenue (or only revenue that is not subject to tax), they must file a so-called zero return.

You are required to file your corporate income tax return electronically (e.g., via the Moje daně portal or a data box) by the following deadlines:

• If you file the return yourself, submit it no later than 4 months after the end of the tax period (by May 1, if your accounting period is the calendar year).
• If you are working with a tax advisor who files the return on your behalf based on a power of attorney, the deadline is extended to 6 months after the end of the tax period (by July 1, if your accounting period is the calendar year).

In the event of serious health complications or an outage of the tax portal or data box, you may request an extension from the tax office before the deadline expires.

Deadline for corporate income tax payment and refund of overpayment

• Do you have a tax liability (a non-negative tax amount exceeding CZK 200)? Send the amount to the tax office’s account by the same deadline as when you file your tax return. The decisive factor is not the date the payment is sent, but the moment the funds arrive. Therefore, it is better to pay a day or two earlier.
• Did you have an overpayment? You can simply request a refund using the tax return form. If the request is in order and you owe nothing to the state, the tax office will refund the overpayment within 30 days.

Corporate Income Tax (CIT) Advance Payments for the Next Period

Based on your tax return, advance corporate income tax payments for the next tax period will be determined (payments you will make to the tax office throughout the year).

The amount of corporate income tax prepayments is determined based on the last tax paid as follows:

We can help you with both accounting and taxes

Don’t want to worry about paperwork? Focus fully on your business and leave the accounting to us. We’ll handle your bookkeeping, including preparing your tax return and financial statements. We’ll keep track of deadlines and ensure everything is accurate, and we’ll file everything for you. Contact us via the form and we’ll take care of the rest.

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