As the Income Tax Code states it, both legal entities and physical persons employing persons with various disabilities are allowed to apply for a tax reduction in the amount of CZK 18,000 for each disabled employee of CZK 60,000 for those with more serious disabilities. Also, it should be noted that the total amount of the reduction is calculated in relation with the annual average number of disabled employees.
The question is, then, which person may fall into the category of a disabled one as such definition is not to be found in the text of the Income Taxes Act; thus, it is necessary, to consult the Employment Act, which divides the disabled into three categories.
The first group comprises employees with the third degree invalidity (the most severe disabilities), i.e. those who their employers may apply the CZK 60,000 reduction. The second category consists of employees of the first and second degree invalidity. The third group is comprised of persons that are disadvantaged (handicapped) – such a person is capable of performing duties of an employed person, but this ability is, due to their disadvantageous state of health remarkably limited in the long term (i.e. more than one year); therefore, they are persons who are challenged physically, mentally or sensorially. The CZK 18,000 reduction applies for both the second and third groups.
Employment of disabled persons is rather a particular process and that is also why the government attempts to support and motivate employers to open up working possibilities for the disabled and the income tax reduction is one of the strategies.