The General Financial Directorate within the Coordination Committee with the Chamber of Tax Advisors expressed its agreement with the conclusion that, even if the individual acts as a member of the body of a legal entity free of charge (i.e. without remuneration), the tax exemption shall apply to the income under Section 6 (7) of the Income Tax Act (ZDP) and the income under Section 6 (9) of ZDP.

A natural person performing, for example, the position of an executive director, may not be required to receive remuneration for this activity, and yet has the right as an employee in connection with the exercise of this position to exempt income which is not subject to income tax under Section 6 (7) of ZDP (e.g. reimbursement of travel expenses) and the exemption of income under Section 6 (9) of ZDP (most standard employee benefits such as the use of educational and recreational facilities, meals, pension or life insurance contributions, etc.).

We would like to highlight that the entitlement to these reimbursements or benefits should be governed by the contract on the performance of the position approved by the General Meeting of the company because a member of the statutory body shall not automatically be entitled to these benefits from, for example, the provisions of the Labour Code as a normal employee.

Šárka Veselá