How to fill in the tax return form?

Every year in the spring, (not only) entrepreneurs have an unpleasant obligation - filing a tax return form. We'll tell you what you need for your tax return, how to fill in the tax form and fulfil your tax obligation.

Who fills in the tax return and how?

According to the Income Tax Act (ITA), all entrepreneurs with annual taxable income over CZK 50,000 (or CZK 20,000 if you are an employed entrepreneur) must file a tax return every year, except for those in the flat-rate tax regime if they have fulfilled its conditions.

Self-employed persons fill in the tax return (DAP) electronically simply through the MyData portal operated by the tax administration. You can also send the electronically completed form to the tax administration via a data box (in .xml format) by 2 May. For details on the deadlines for submitting the DAP and the payment of the tax itself, see the article on personal income tax returns (DPFO).

Let's now take a look at how to complete the tax return.

Orientation to the tax return

The tax return consists of several documents - the basic form and various annexes. How to find your way around them?

The basic form

The basic form is completed by all taxpayers. It contains your identification details and basic information about your tax base, tax credits and total tax.

Header and introductory section

In the header of the tax form, be sure to fill in your tax number and indicate whether it is a regular, amended or additional tax return. You should also indicate the local tax office and its territorial office to which you are submitting the return.

How do I find out which tax office you fall under? For individuals, this is determined by the address of their permanent residence. If you are not sure, you can find out the territorial office by using the postcode in the tax administration' s online tool.

In the heading of the form, you indicate which tax year it relates to (most often the previous calendar year).

This is followed by Section 1, where you enter your personal details. This section is fairly intuitive, you may be puzzled only by the final lines 29 and 29a - however, these only apply to you if you are not a tax resident of the Czech Republic. In line 30 you then indicate whether you are related to a foreign person (e.g. you have a share in a foreign parent company).

Section 2 of the DAP

If you have successfully got this far, get your calculator ready. This is where the calculations begin. In the first section, you will fill in details of your earned income if you are running a business while employed. To do this, ask your employer for a Taxable Income Certificate.

The next section is a little more complicated. This is where you list the partial tax bases of all your income (read which income belongs on your tax return). In practice, this means that it is filled in after you have filled in all the attachments to your tax return (see below). This is where you calculate the partial tax bases.

Once you have added the sub-bases together, the last lines give you the total tax base.

Sections 3, 4 and 5 of the DAP

The tax base is then reduced in Section 3 by the non-taxable parts of the tax base (e.g. gifts or contributions to supplementary pension savings) and deductible items.

Section 4 then calculates the tax itself.

Then, in section 5, you deduct any reliefs claimed (e.g. taxpayer's or disability allowance) and child tax credit.

The result is the final amount of tax you have to pay.

The next section of the form is then used to fill in information about any advance tax paid and any attachments to the document. The final section also allows you to claim a refund of any overpaid tax.

Attachments

The DAP also includes selected annexes. Which attachments you fill in depends mainly on the type of income you have.

Businesses always submit Schedule 1, which relates to self-employment income. You fill in Annex 2 if you have rental income and other income. Annex 3 contains information on income from abroad.

Are taxes on your mind?

Completing your tax return is not a simple matter. Save yourself the hassle and have it prepared by experts. We will be happy to help you! Contact us using the form below.