In connection with the recent floods that hit the territory of the Czech Republic, the Financial Administration (hereinafter also the “FA”) reacted to this natural disaster by issuing Information on its website on 18 September 2024. In addition to the information on dealing with the consequences of the floods in the area of VAT (our article here), the FA also came up with other tax breaks. What tax relief is involved?

Request for deferral

In the event of an imminent default in the payment of taxes and tax advances, it is possible to apply for deferral of payment of the tax or to pay it in instalments, even retrospectively. The application can be made using the FA web application Request for permission to delay

Request for waiver of tax accessories

It is possible to apply for a waiver of additional tax, i.e. interest on late payment, interest on the overdue amount and penalty for late declaration of tax. Recipients of subsidies may apply for a waiver of the levy and penalties.

Request for determination of advances otherwise

Upon request, the tax administrator may set the advance tax payments differently or waive them altogether. The FA web application can be used for the application Application for determination of advances otherwise.

Request for extension of the deadline for filing a tax return

In cases of necessity, the filing deadline may be extended for some returns, and the application will take into account the effects of a natural disaster. To apply, you can use the FA web application MOJE daně portal.

Flood donations

The income tax base of natural and legal entities can be reduced by donations made for ecological, medical, humanitarian, charitable, animal protection or health purposes, among others.

Financial and other donations received from public collections, but also directly from individuals and legal entities or e.g. through an employer in connection with a natural disaster are exempt from personal and corporate income tax. We have discussed the issue of gifts in a special article.

Exemption from real estate tax

Until 31 March 2025, municipalities and towns affected by a natural disaster may exempt land, taxable buildings and taxable units affected by a natural disaster from real estate tax for up to 5 years by issuing a general binding decree (general exemption) or a measure of a general nature (exemption of specific immovable property).

Conclusion

It has been promised that the tax administrators would proceed in the most helpful way and in mutual cooperation with individuals and legal entities affected by the floods. Employees of the tax authorities also offer consultations to entrepreneurs. If, as a result of difficult economic or social conditions, taxpayers should incur any penalties in connection with the fulfilment of tax obligations, they will be waived by the tax administrator upon request (Notice).

If the tax procedure involves an administrative fee, individuals and legal entities affected by floods are exempt from such fees. 

The full text of the Information can be found at here.