COMPANY IN THE CZECH REPUBLIC

2024-11-13 Thompson&Stein

The possibility of establishing a company in the Czech Republic is very popular among entrepreneurs interested in moving their companies abroad. Its location in the heart of Europe and its stable legal system make establishing a company in the Czech Republic a tempting opportunity. Corporate income tax in the Czech Republic is 19%, while personal income tax is 15% and is increased by a 7% solidarity surcharge for top earners. Are these differences sufficient arguments in favour of changing one’s tax residence?

Call us! Our lawyers will be happy to answer your questions and advise you on the best place to start a company.

Is establishing a company in the Czech Republic a good idea?

A company in the Czech Republic can represent an attractive solution for entrepreneurs from many sectors. The undoubted advantage of owning a company in the Czech Republic is the possibility for Czech companies to purchase cars without excise duty and deduct full VAT. Corporate income tax for the companies in the Czech Republic is 19%, which is even higher than for small companies in countries such as Poland or Lithuania. Another advantage of establishing a company in the Czech Republic may be the low initial capital requirement of CZK 1. However, such Czech companies are often perceived as shell companies, and establishing a company in the Czech Republic involves high administrative fees (up to CZK 10 000 for drawing up the notarial deed or court fees).

An unquestionable advantage of owning a company in the Czech Republic is the friendly and straightforward tax system, which allows a Czech company to deduct between 40% and 60% of its business expenses without having to document them. When establishing a company in the Czech Republic, it is also worth noting that the basic VAT rate is 21%, while it is either 15% or 10% at the reduced rate. The VAT exemption limit for the turnover on the Czech market is CZK 1 million. When deciding to set up a company in the Czech Republic, one must take into account the complex process of registering for VAT (registration takes about 30 days), the high costs of health insurance (in the case of high earnings for employed workers), and the need to provide a clean criminal record certificate.

Advantages of owning a company in the Czech Republic

Low share capital required
A friendly and straightforward tax system
VAT at 21% (with a reduced rate of 15% and 10%)
Flat corporate income tax rate (19%)
Income-based contributions and entrepreneurial pensions
No obligation to have cash registers
Official matters can be handled remotely

A company in the Czech Republic – who can find it a good solution?

A company in the Czech Republic is top-rated among entrepreneurs from the transport and logistics industry. It is a potentially attractive location for people doing business close to the Czech border. E-commerce, marketing, services, and trading businesses also often choose to establish a Czech company. A company in the Czech Republic may represent an attractive solution for businesses whose net annual income exceeds EUR 50,000.

Scope of our services offered to companies in the Czech Republic:

Thompson&Stein’s services for your company in the Czech Republic:

COMPREHENSIVE HANDLING OF THE COMPANY REGISTRATION PROCESS
ACCOUNTING SERVICES
A REGISTERED SEAT (ADDRESS) FOR YOUR COMPANY
MANAGING of incoming CORRESPONDENCE
ASSISTANCE IN OBTAINING LICENCES (if required for the given type of activity)
SUPPORT AT EVERY STAGE of establishing your company in the Czech Republic

LEARN MORE

If you'd like to learn more, please send us the form. It will be forwarded to our customer support team, and we guarantee that we will respond to your inquiry within 24 hours (on business days).

Select the subject of your inquiry, and we will ensure it reaches the right person who can provide you with the relevant support.

The form is protected by reCAPTCHA, and we adhere to our Privacy Policy.