Tax news

The year 2026 brings one of the biggest waves of change in recent years. It is not just about individual amendments, but about a systemic shift – in the area of taxation, accounting and in the administration of employers. Some changes are already in place, others are still in the pipeline, but most of them require early preparation. We summarize the most important innovations and their practical impacts.

1. Employees, wages and benefits: no more "optimizations" and more administration

Employee benefits: a clear line between benefits and wages
The amendment to the Act responds to the case law of the Supreme Administrative Court and explicitly specifies the rules for the exemption of "leisure" benefits. The aim is to prevent the practice of actually disguising part of the salary as a benefit.

Only performances beyond wages can now be exempt from tax, they must not be related to the specific performance of work.

Typically, these are:
  • Multisport cards
  • contributions to health, sport, culture or recreation
On the contrary, any performance linked to work performance is considered to be wages – regardless of the form, and even if it is provided for the listed purposes, the related income cannot be exempted.

Agreements and withholding tax: changes continue
The limits for agreements to perform work and small-scale employment change every year. However, the outlook for 2027, when the withholding tax for below-threshold agreements is to be abolished, is crucial  . At the same time, however, adjustments are being introduced to the obligation to file a tax return for employees or self-employed persons who use a flat-rate tax so that these small additional earnings do not bring a higher administrative burden in the form of the obligation to file a tax return even after the change.

Uniform Monthly Employer Report (JMHZ): a major turning point
From 1 April 2026, the Uniform Monthly Employer Report will start. It is a digitization project that is supposed to replace the repeated sending of the same data to different authorities.
Main Features:
  • The obligation applies to all employers
  • The data will be reported individually for each employee and working time
  • submission exclusively electronically by the 20th day of the following month
Although JMHZ is supposed to simplify administration, at least at the beginning of the project, it will mean a significant burden, especially the need to adjust payroll systems and internal processes.

2. Natural persons: cryptocurrencies, stocks and self-employed persons

End of the limit of 40 million for the sale of securities and shares
One of the most significant changes is the abolition of the CZK 40 million limit for the exemption of income from the sale of securities and business shares for natural persons – subject to a time test (3 years for securities, 5 years for shares).

The change is effective from 1 January 2026 and has a major practical impact:
  • Exempt income is subject to a limit only if it was realised in 2025
  • Income received from 1 January 2026 is completely exempt if the time test is met, without an upper ceiling
Example:
A natural person sells a share in a company in 2025 for a sale price of CZK 60 million. If they receive the funds from the sale of the share in 2025, part of the income above CZK 40 million. is subject to taxation. If she received the same income only in January 2026, she would be exempt in her entirety.

Limit 40 mil. From 2026, the transfer of crypto-assets for consideration will remain the same.

Employee Stocks and Options: A New Regime for Startups
The taxation of employee stock and option programs has undergone a series of changes in recent years. From April 2025, the system will stabilize:
  • The moment of taxation is chosen by the employer
  • can be taxed immediately, or you can choose to postpone it for up to 10 or 15 years
  • A special qualifying options regime  (especially for start-ups) is newly created, where income will not be subject to insurance premiums
The key is to meet the notification obligation and set up the option program correctly.

Low-emission vehicles: simpler definition, more certainty
From 2026, the definition of a low-emission vehicle for income tax purposes is changing. The good news is that:
  • no link to European emission directives
  • only CO₂ emissions up to 50 g/km and vehicle category (M1, M2, N1) are decisive
Thus, the advantage in the form of 0.5% per month of the purchase price for the use of a company car for private purposes is retained.

Self-employed: increasing minimum contributions
For the self-employed, the growth of the minimum assessment base for social insurance continues. In 2026,  the minimum monthly advance  is CZK 5,720 (for the main activity). Health insurance is increasing only due to the increase in the average wage, to CZK 3,306 in 2026.

3. Corporate tax: investment, research and energy

Research and development: significantly higher tax support
The amendment allows for the application of:
  • 150% of R&D costs up to CZK 50 million (per tax period)
  • 100% of the costs above this limit
At the same time, the period for applying the deduction is extended to up to 5 years. For groups, the limit of 50 mil. It assesses the project together, which prevents the artificial division of projects. For companies investing in development, this is one of the most significant pro-growth changes in recent years.

End of special depreciation of PV plants: return to general rules
From 1 August 2025, the special 20-year depreciation of photovoltaic power plants is abolished. PV plants are now depreciated according to the general regulation:
  • construction part, usually in the 4th-6th depreciation group
  • technological part (panels, inverters) separately, usually in the 2nd or 3rd group
  • Battery storage in group 2
In the event that depreciation was initiated in the period 1.7.2024 - 31.7.2025, the taxpayer could decide whether to use the new regime or continue with time depreciation.

Increase in the limit for the creation of a provision for small receivables (Section 8c)
From 1 January 2026, the limit for "small" receivables, for which a 100% tax provision can be created on a one-off basis, will increase from CZK 30,000 to CZK 50,000. The change is effective without a transitional provision. The Financial Administration, through the Coordination Committee of the Chamber of Tax Advisors, has confirmed that the increased limit will apply to all receivables that meet the conditions of the aforementioned provision, regardless of the moment of their occurrence or maturity – i.e. even those that arose or became due by 31.12.2025.

Top-up tax: more time to prepare your filing
For groups with a turnover of more than EUR 750 million, the deadlines for filing the top-up tax return are extended to up to 22 months after the end of the period. The Czech regulation thus comes closer to the OECD model rules.

4. Value added tax: significant changes not only in real estate, higher responsibility and new processes

The VAT area is undergoing  a gradual but very noticeable transformation in the years 2025–2026. The changes do not concern rates as such, but primarily processes, deadlines and the responsibility of payers. In practice, this means higher demands on records, control of suppliers and work with documents.

New VAT refund mechanism
  • From 2026, a new procedure is introduced for cases where VAT has been paid incorrectly, typically:
    • the reverse charge regime should have been applied, but it was not;
    • an incorrect rate has been applied;
    • the place of performance was incorrectly determined.
  • If the supplier has paid VAT to the state but has not returned it to the customer (e.g. due to insolvency),  the customer may seek a tax refund directly from the tax administrator if the legal conditions are met.
  • This mechanism is intended to prevent situations where VAT would actually be paid twice, but at the same time it is very demanding in terms of procedure and evidence and will be usable more in exceptional cases.

Change in the correction of VAT deduction for fixed assets for mixed purposes
  • In the last VAT return of the calendar year, the VAT deduction applied to fixed assets (e.g. a car) that are used for both economic and non-economic (especially private) purposes must be corrected or confirmed.
  • Newly, i.e. already for 2025, this correction must be made in the first year, even though the change between the coefficient according to the qualified estimate for the acquisition of fixed assets and the resulting annual coefficient is only 1 percentage point.
  • In the next four years (nine in the case of real estate), the rule remains that the applied VAT deduction can or must be adjusted only if the difference to the coefficient of the first year exceeds 10 percentage points.
Other financial activities cannot be exempted from VAT
  • In 2025, the possibility of exempting
    • management of the client's assets on the basis of a contract with the client, if the assets include an investment instrument.
  • In 2026, the exemption can no longer be applied to
    • arranging direct debits;
    • keeping records of investment instruments;
    • collection of fees for radio and television broadcasting;
    • payment of pension insurance benefits and collection of recurring payments of the population.

VAT payers: new calculation of turnover and the moment of occurrence of the obligation
  • From 2025 onwards, VAT turnover is assessed per calendar year, not on a rolling basis over 12 months. At the same time, the moment of inception of the payer is changing:
    • if the basic limit is exceeded (CZK 2 million), the payer usually does not arise until 1 January of the following year,
    • if the higher limit is exceeded, namely CZK 2,536,500, the payer becomes incurable immediately, on the day following the day on which the limit is exceeded.
  • For 2026, this means the need to continuously monitor turnover within the calendar year, otherwise there is a risk of late registration and subsequent additional assessments.

Correction of the deduction in the event of non-payment of the obligation
  • From 2025, a new reason arises for the correction (refund) of the VAT deduction claimed under the normal regime. If the recipient of the supply fails to pay the liability from the taxable supply by the end of the sixth calendar month following the due date, the obligation to take this fact into account in VAT arises.
  • In practice, this increases the importance of working with open commitments and monitoring them regularly.

VAT Guarantee: Emphasis on "knew or should have known"
  • The concept of the recipient's liability for unpaid VAT by the supplier is becoming stricter. The key is to test whether the recipient:
    • He knew, or should have known, and could have known, that the tax would not be paid intentionally.
  • The tax administrator will assess the circumstances of the transaction, the price, the payment terms and the behaviour of the contracting parties. In 2026, the importance of supplier verification, internal documentation and the defensibility of business decisions will increase even more.
VAT and real estate: regimes, rates and choice of taxation
  • In mid-2025, there was a groundbreaking change in the supply of real estate, which has a direct impact primarily on developers, investors and landlords.
  • Only the first delivery of completed immovable property within the two-year period is subject to mandatory taxation. Further supplies within this period or supply after the expiry of the deadline are exempt from tax without the right to deduct. The possibility of voluntary taxation of the supply of real estate that would otherwise be exempt from VAT remains unchanged.
  • Another significant change is the new assessment of a substantial change to immovable property (especially reconstruction). From this change, a two-year period runs again, within which the first supply of the reconstructed property is again considered a taxable supply. A substantial change will simply occur if the value of the reconstruction exceeds 30% of the sales price excluding VAT.
  • The definition of building land has been specified directly in the law. Among other things, the (non)inclusion of the land in the zoning and planning documentation of the municipality is crucial.
  • The rules for the application of the reduced VAT rate to housing and social housing buildings are also modified and the work with floor areas is made more precise.
  • At the same time, the possibilities of voluntary taxation for selected supplies and leases of real estate in relation to foreign entities are expanded.
Right to deduct: shortening of deadlines
  • One of the most noticeable changes is the shortening of the deadline for claiming the right to deduct. The deduction can now only be claimed until:
    • two calendar years immediately following the year in which the claim arose.
  • This change increases the risk of "forfeiture" of deductions for older documents and places higher demands on:
    • timely posting,
    • control of received performances,
    • Error resolution in even shorter deadlines.
VAT Registration Deduction: Wider Options for Fixed Assets
  • A positive change is the extension of the possibility to claim a VAT deduction upon registration, especially for fixed assets. If the statutory conditions are met, a deduction can now also be applied from supplies received up to five years retrospectively, if the property was put into use after the establishment of the payer's business.
Outlook for the next years: VAT in the digital age (ViDA)
  • Although the main effectiveness of the European VAT in the Digital Age (ViDA) project  will not occur until after 2028, the coming years are crucial in terms of preparation. ViDA will bring:
    • mandatory digital reporting of cross-border B2B transactions,
    • a fundamental change in the work with invoices and data,
    • Gradual transition to e-invoicing in structured formats.
  • Companies that start addressing data quality and IT readiness early will make their future transition much easier.

5. Accounting: new limits and new obligations

New categories of accounting entities
The limits for categorisation of accounting entities are increasing. For the purposes of determining the category of accounting entity for 2026, the values for the years 2024 and 2025 are already assessed according to the new threshold indicators. Changing the category has a direct impact on:
  • the scope of the financial statements,
  • the obligation to compile cash flow,
  • Mandatory audit (now only medium and large units).
Income Tax Report (Public CbCR)
Selected large companies must newly  publish an Income Tax Report, which must be publicly available for 5 years. Failure to comply with the obligation can lead to a fine of up to 3% of the value of the assets.

6. Tax Code and controls: stronger financial administration

Extensive amendment to the Tax Code from 1 July 2025 and 1 January 2026 – focuses mainly on recovery and interest, but also brings a number of other changes:
  • The end of "interest on interest" (Section 251c of the Civil Code) – newly explicitly excluded, yet the possibility of seeking redress in older cases remains.
  • Waiver of up to 100% of penalties (Section 259a of the Tax Code) – as a result, the Financial Administration issued a new instruction GFD-D-72, which contains extended options for waiving tax accessories.
  • New enforcement instruments – the possibility of seizing movable assets from registers (cars, ships, aircraft), selling property rights at auction (Section 193a), seizing crypto-assets (Section 215a) and opening a protected account.
  • Other changes – adjustment of fines for late assertion (Section 250), service abroad, tax liability upon dissolution of a trust fund (Section 240e).