Updated 30/09/2026
Tax on rental income in Czechia (2026)
How long-term letting of a flat is taxed: the 30 % flat-rate deduction or actual costs with depreciation and interest. When each pays off, the 15 and 23 % rates and tax on sale.
An individual taxes income from long-term letting of a flat as income from renting under § 9 of the Income Tax Act (zákon o daních z příjmů, ZDP). It is not a business, so no social or health insurance (sociální a zdravotní pojištění) is paid on it, and residential rent is exempt from VAT. The key decision is how you claim expenses.
Flat-rate deduction or actual expenses?
| Flat-rate deduction (paušál) | Actual expenses (skutečné výdaje) | |
|---|---|---|
| Amount | 30 % of income, max. 600,000 CZK a year | Documented costs |
| What it covers | Everything, no receipts needed | Repair fund and owners' association (SVJ) administration, insurance, property tax, repairs, letting management, agent fees, mortgage interest, depreciation |
| Tax loss | Cannot arise | Can arise and is carried forward for the next 5 years |
| Who it suits | Flats without a mortgage, cheaper flats | Flats with a mortgage, more expensive flats |
For a buy-to-let flat financed with a mortgage, actual expenses almost always work out better. In the first years, interest and depreciation often exceed the entire rent, so the tax is zero and a loss arises that you can use later.
Depreciation of a flat
- A flat falls into depreciation group 5 (5. odpisová skupina) (30 years). With straight-line depreciation that is 1.4 % in the first year and 3.4 % in subsequent years.
- What is depreciated is the purchase price excluding the share of land, plus incidental acquisition costs and technical improvements (technické zhodnocení, i.e. renovation). For a flat in a multi-storey building, the land usually makes up only a few percent of the price. The calculator assumes 8 %, which does not overstate depreciation; the exact share is set by an expert valuation (znalecký posudek).
- If you use the flat-rate deduction, depreciation is deemed to have been claimed. The undepreciated value therefore falls anyway, which matters when you sell.
Tax rate
Profit from letting is added to your other income. Up to 1,762,812 CZK a year (36 times the average wage for 2026) the rate is 15 %, above this threshold 23 %. If you own the flat in community property of spouses (společné jmění manželů), you can split the income and thus avoid the 23 % rate on high incomes.
Tax on sale
The sale of a flat is exempt if you have owned it for more than 10 years (for flats acquired from 1 January 2021; 5 years for older ones). On an earlier sale the gain is taxed: sale price minus selling costs minus the purchase price reduced by the depreciation claimed.
Example: a flat for 6 million CZK, a 4.2 million CZK mortgage at 5 %, rent of 20,000 CZK a month. Annual rent is 240,000 CZK, interest in the first year roughly 208,000 CZK, and depreciation of 1.4 % of roughly 5.5 million CZK (excluding the 8 % land share) is roughly 77,000 CZK. With the owners' association (SVJ) fees and other costs the result is a tax loss, so the tax is 0 CZK. With the flat-rate deduction, the tax would be 15 % of 168,000 CZK, i.e. 25,200 CZK.
Short-term letting is a different case
Airbnb with cleaning and services is an accommodation trade (živnost) under § 7: a different flat-rate deduction (60 %), self-employed insurance contributions (pojistné OSVČ) and possibly VAT. For details, see the guide to short-term rentals.
Sources
- Fakturoid: How to invoice short-term rentals and tax Airbnb income (2026)
- TPA: Average wage and limits for 2026
- Dr. Bacon: Income tax on the sale of property 2026
This text is indicative and does not replace tax, legal or financial advice. For binding decisions consult a Czech tax adviser. · Privacy policy · Terms of use ·