Changes in 2014 income tax (Czech Republic)

• The physical person’s income tax rate of 15% remains applicable, calculated from super-gross wages (1.34 multiple of gross wages). Solidarity tax increase of 7% will still be levied.
• It will not be possible to perform yearly billing of 2013 income tax advance payments for the employees who were subject to solidarity tax increase in 2013 (even though in a single month). Such employees are obliged to file the 2013 tax return by themselves.
• Since 1 January 2014, the limit for application of the final withhold tax is increased for the taxpayers who did not sign a tax declaration with the employee, namely from CZK 5 thousand to CZK 10 thousand per month. However this limit will only apply to the incomes received by taxpayers on the basis of an agreement to complete a job.
• If the employer grants an employee an interest-free loan, according to the new regulation such employee’s proprietary benefit shall not be subject to physical person’s income tax regardless of the purpose of the loan.
  The employers will only be allowed to apply the basic taxpayer’s rebate for the Czech tax non-residents in their wages.

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