A tax return needs to be filed by anyone whose annual income is subject to personal income tax and this income has exceeded CZK 15 000. Income exempt from tax and income for which tax is collected as a deduction according to a special tax rate is not included in this income. Persons for whom tax is increased by a solidarity tax increase also have to file a tax return. Anyone whose yearly income has not exceeded CZK 15 000 but who has a tax loss must also file a tax return.
A tax return does not have to be filed by a person who has income from employment from just one employer or sequentially from several employers, provided that the taxpayer has signed a tax declaration with these employers. In such a case the taxpayer can ask his last employer (the payer of the tax) to make an annual settlement which enables the taxpayer to save time in completing a tax return and also he is not denied the opportunity to apply for the tax benefits to which he is entitled. An important fact that is often overlooked is the condition of succession when the taxpayer has more than one employer in one calendar year.
If the condition of succession is breached the taxpayer has the duty to file a tax return. This means that if at one moment several employment relationships or agreements on work performed outside employment are valid at the same time, there is a duty to file a tax return for the relevant tax period, in which the concurrence occurred. The only exception is a concurrence of incomes where the additional income to the main income forms separate tax bases, i.e. tax is collected as a deduction according to a special tax rate. However, separate tax bases can only be formed from income from agreements on the performance of work, provided that this income does not exceed CZK 10 000 monthly. So the taxpayer is also required to file a tax return if his income has been paid by employers with whom he has not signed a tax declaration and the tax has been deducted in advance.
The obligation to file a personal income tax return may also arise in cases where during the tax period the taxpayer has income both from employment and from business. If the gross income from business, capital assets, rent and other income exceeds CZK 6 000 per year, the taxpayer is required to complete and file a tax return. It should be remembered that this is only gross income and not profit (i.e. income net of expenses).
Ing. Eva Huclová