Investment Advice for Expats in Czech Republic: Tax, Real Estate & Residency Options in Central Europe

With a resilient economy, an independent central bank, and a strong rule-of-law framework anchored in the European Union, the Czech Republic offers expats a secure environment for long-term financial growth.

But unlike many of its EU peers, Czechia maintains a moderate cost of living, a stable national currency (the koruna), and clear, predictable tax rules that reward long-term investing.

Recent changes have made the landscape even more dynamic. From January 2025, long-term capital gains exemptions now carry an annual cap of CZK 40 million per taxpayer, while cryptocurrency taxation has been updated in line with new EU MiCA regulations.

This guide covers:

• Tax Residency in the Czech Republic
• Does the Czech Republic have a golden visa?
• How are investments taxed in the Czech Republic?
• Can foreigners own real estate in the Czech Republic?
• Cryptocurrency in the Czech Republic (2025 Regulations)

Key takeaways:

• The Czech Republic combines EU-level stability with a moderate cost of living and predictable tax framework, appealing to long-term expat investors.
• Tax residency determines whether income is taxed globally or only on Czech-sourced income, with treaties reducing double taxation risks.
• Czechia offers residence permits through self-employment or business formation rather than passive golden visa programs.
• Long-term capital gains exemptions remain attractive but are now capped at CZK 40 million per year starting 2025.
• The country is progressive on cryptocurrency regulation, aiming to balance innovation with fair taxation under the new EU MiCA framework.

My contact details are hello@adamfayed.com and WhatsApp +44-7393-450-837 if you have any questions.

The information in this article is for general guidance only. It does not constitute financial, legal, or tax advice, and is not a recommendation or solicitation to invest. Some facts may have changed since the time of writing.

Tax Residency in the Czech Republic

Taxation in the Czech Republic depends primarily on whether you are classified as a resident or a non-resident, and that determination affects how your income is taxed.

You are considered a Czech tax resident if you:

• Have a permanent home in the Czech Republic (a place available for your long-term use, not just a temporary rental); or
• Spend more than 183 days in the country during a calendar year (days of arrival and departure count).

If either condition is met, you are taxed on your worldwide income. Non-residents, by contrast, are taxed only on Czech-sourced income such as local employment, property rental, or gains from Czech securities.

Czechia uses a two-tier personal income tax system:

• 15% on income up to approximately CZK 1.6 million annually.
• 23% on income above that amount.

There is no separate solidarity tax, as the higher 23% rate now incorporates that surcharge.

The country has signed double taxation agreements (DTAs) with more than 90 nations, including the United States, the United Kingdom, Canada, Australia, and most of the EU.

These treaties prevent the same income from being taxed twice and often reduce withholding tax rates on dividends, interest, and royalties.

To benefit, expats must file a tax residency certificate from their home country and meet the beneficial ownership and substance tests required under OECD standards.

Expats working for local companies typically have income tax withheld at source by employers, while freelancers and investors must file annual returns.

Returns are due by April 1, or by July 1 if submitted electronically or through a certified tax adviser.

The Czech tax year follows the calendar year, and all filings must be in Czech koruna, with income converted using the official Czech National Bank average rate.

Does the Czech Republic have a golden visa?

No, Czechia does not have a traditional golden visa or citizenship by investment program that grants residency simply for buying real estate or making a passive investment.

However, the Czech Republic does offer a Long-Term Residence Permit for the Purpose of Investment, which is a highly selective and demanding path for significant investors who wish to be actively involved in the Czech economy.

Czech Republic Self-Employed Residence Permit

This is the most common route for non-EU nationals seeking residency through economic activity. Instead of buying property or making a passive investment, you establish yourself as a sole trader (živnostník).

Requirements:

• Register a trade license (known as a živnostenský list) through the Czech Trade Licensing Office.
• Submit a business plan, financial means (typically around CZK 110,000–120,000 to cover initial living expenses), and proof of accommodation.
• Obtain comprehensive health insurance for the duration of your stay.
• Maintain a registered office address in Czechia.

Duration and renewal:

• The first long-term residence permit is usually valid for 1 year, renewable upon proof of continued business activity and income.
• After 5 years of continuous residence, you can apply for permanent residence, leading eventually to eligibility for Czech citizenship (subject to language and integration tests).

Advantages:

• Allows you to live and work legally in the Czech Republic.
• Can be structured around consulting, property management, online business, or freelance work.
• Eligible for the flat-tax (“paušální daň”) regime to simplify tax compliance.

Limitations:

• It’s not passive as you must demonstrate genuine self-employment or entrepreneurship.
• Doesn’t automatically confer work rights for dependents (they need family reunification status).

Company Founder or Investor Route

Foreign nationals can also obtain residence by establishing or investing in a Czech company (e.g., a s.r.o. limited liability company).

Requirements:

• Incorporate a Czech company with a minimum registered capital of CZK 1 (though most use CZK 100,000 for credibility).
• Be appointed as executive director (jednatel) or owner.
• Apply for a long-term residence permit for business purposes under your corporate role.
• Provide proof of sufficient income and business activity (bank statements, contracts, or invoices).

This route is similar to the self-employment permit but uses a corporate vehicle instead of a trade license. It’s especially suited to expats who want to operate or manage a company rather than freelance.

Czech Startup or Innovation Programs (Limited Pilot Forms)

Czechia also has targeted programs for high-skilled professionals and entrepreneurs, such as:

• Czech Republic Startup Visa (Pilot Program) – designed for tech entrepreneurs sponsored by certified incubators or accelerators.
• Highly Qualified Employee Scheme – for skilled workers invited by Czech employers. These are selective and do not equate to traditional capital-based golden visas.

How are investments taxed in the Czech Republic?

For Czech tax residents, dividends and interest income are generally taxed at a flat 15% rate.

When income is paid from abroad, withholding may also occur in the source country, but most double-taxation treaties reduce this rate.

Non-residents are taxed only on Czech-sourced investment income.

Dividends from Czech companies to non-resident investors are usually subject to 15% withholding, which can be reduced or eliminated under treaty provisions.

However, if the recipient is based in a jurisdiction without a tax treaty, a 35% withholding tax applies. Interest payments from Czech borrowers follow the same structure.

Czechia’s capital gains regime is notably favorable for long-term investors. Gains from the sale of listed securities (such as shares or ETFs) are exempt from tax if the investor holds them for at least three years.

For unlisted corporate shares, the required holding period is five years. These exemptions make the country particularly attractive to expatriates following a buy-and-hold investment strategy.

Starting January 2025, the government introduced a CZK 40 million annual exemption cap per taxpayer.

This means that even long-term holdings sold after meeting the three- or five-year time test are exempt only up to that annual threshold; any amount above it becomes taxable.

Investors with large portfolios should therefore stage their disposals over multiple tax years to remain within the cap.

There is also a small-sale exemption: if total proceeds from all securities sales in a tax year are under CZK 100,000, the gains are tax-free regardless of how long the assets were held.

This rule benefits small investors and allows tactical rebalancing without tax exposure.

Can foreigners own real estate in the Czech Republic?

Yes. Foreign individuals and companies may freely buy residential or commercial real estate. Ownership is registered in the Czech Land Registry (Katastr nemovitostí), a digital public database that confirms title and encumbrances.

The process typically takes two to four weeks and involves a notarial contract and cadastral registration.

In 2020, the government abolished the 4% real estate acquisition tax, significantly reducing upfront costs for buyers. This change applies retroactively to late-2019 transactions and remains in effect.

Buyers now only pay notary and registration fees, which are modest compared to Western Europe.

Property owners pay an annual property tax based on the land and building type, size, and municipal coefficients.

The amounts are generally low, often a few thousand koruna per year for standard residential units, though rates vary by city.

Municipalities set multipliers, so property in central Prague may attract slightly higher rates than in rural areas.

Rental income is subject to income tax. Individuals can deduct actual expenses (such as maintenance, utilities, and depreciation) or elect a flat 30% expense allowance capped at CZK 600,000 annually.

Short-term rentals, such as those listed on Airbnb, are often treated as business income rather than passive rent. This classification may trigger registration obligations, social contributions, and potential VAT if turnover exceeds the threshold.

Expats using short-term platforms should confirm their tax treatment to avoid misclassification.

Czech banks offer mortgages to foreigners, though requirements vary.

• EU residents generally receive the same terms as citizens.
• Non-EU residents often face stricter conditions, such as larger down payments (20–30%) and proof of local income or long-term residence.
• Mortgage interest on a primary residence may be deducted from taxable income, up to CZK 150,000 per year for loans issued after 2021 (the previous limit of CZK 300,000 applies to older loans).

Cryptocurrency in the Czech Republic (2025 Regulations)

As of 2025, the government has begun harmonizing national law with the EU’s Markets in Crypto-Assets (MiCA) regulation, setting clearer definitions for exchanges, wallet providers, and individual investors.

Under current Czech tax law, cryptocurrency is treated as movable property, and gains from sales are taxed as personal income.

For individuals, profits are included in the taxable base at the standard 15% or 23% rates, depending on total income. Losses can only offset other capital gains within the same category.

However, reforms debated and partially implemented in 2025 introduced limited exemptions for smaller or routine personal transactions.

The new framework aims to distinguish between speculative trading and ordinary use such as converting small amounts of crypto for everyday purchases, potentially exempting minor disposals from tax.

Details depend on forthcoming Finance Ministry guidance, but the direction is toward lighter taxation for non-professional crypto users.

This makes the Czech Republic one of Europe’s more progressive jurisdictions regarding cryptocurrency, balancing openness to innovation with practical taxation.

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