In connection with the consolidation of public budgets, Act No. 338/1992 Coll., on the Real Estate Tax (hereinafter referred to as the "Real Estate Tax Act"), will be amended as of 1 January 2024.

Some of the amendments do not come into force until the 2025 tax year, but a large part of the amendments affect the 2024 tax year. If the amendments do not state that they are amendments effective from 1 January 2025, they are amendments effective from 1 January 2024. 

Property tax returns are normally filed by taxpayers who have acquired any property in the previous year. From 1 January 2024, with the entry into force of the so-called consolidation package, the obligation to file a real estate tax return will apply to more than one person. 

The expected changes will mainly concern: 

Rate increases, the introduction of an inflation factor for automatic tax increases, and changes to exemptions and taxation of different types of real estate. 

The Finance Report also clarifies when you must file your property tax return following the amendments to the Property Tax Act. These are mainly the following cases:

1) Building land

The new rule is that if you have obtained a building permit or are already constructing a building on land where another building already stands, you are required to file a return for the land to the extent of the future construction and tax at the higher rate for building land. 

2) Paved area

If you have land on which there is a paved area (and it is not registered as other land or as built-up area and yard) and have it classified as business property, you must file a new return and tax the portion of the land on which the paved area is located at the higher rate for the type of land paved area

The amendment to the law will also affect users of land owned by the State Land Authority, renting out rooms in a residential house or unit, farm forests under the influence of immissions classified as hazard zone "A and B" and others. On the other hand, returns will not have to be filed and the tax authority will take into account the changes itself, for example, in the event of a change in the tax rate, a change in the coefficients for calculating the tax and the introduction of a new tax rate. 

More detailed information can be found on the website of the Tax Administration of the Czech Republic here

If you have any questions about this area, please do not hesitate to contact us and we will be happy to answer your questions.

Author: Alexa Horváthová

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