Czech Republic: Tax relief including loss carryback measure (COVID-19)

Czech Republic: Tax relief, loss carryback measure

The Ministry of Finance on 24 March 2020 announced tax relief measures in response to the coronavirus (COVID-19) pandemic. Measures that must be in form of legislation have already been or will be submitted to the Chamber of Deputies.


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Introduction of “loss carry-back” concept (tax losses to be applied to earlier years) for 2020

Under one proposal, taxpayers that recognized a tax liability for 2018 or 2019 and plan to report a tax loss for 2020 would be able to deduct this loss from their tax bases for 2018 and 2019—thus possibly providing for a refund of income tax. The application of tax losses from 2020 to earlier years would be available if amended (additional) income tax returns are filed for the 2018 and 2019 tax periods. The resulting tax overpayment would then be refunded to the taxpayer’s account based on the taxpayer’s application.

Currently, this is only a proposal of the Ministry of Finance, and it has not yet been submitted to the Chamber of Deputies. The final version of this measure may therefore change during the legislative process.

Other tax relief measures

The Ministry of Finance has decided to provide general waivers concerning:

  • Income tax prepayments due 15 June 2020, without an obligation to file an extension request application for calendar year taxpayers 
  • The late filing of an immovable property (real estate) acquisition tax return; no default interest for the late payment of this tax, or its prepayment, is to apply regarding tax returns with a filing deadline between 31 March and 31 July 2020
  • Late filing of value added tax (VAT) returns
  • Selected customs-related fees
  • Electronic report sales during the period of the COVID-19 emergency and for the following three months

Read a March 2020 report prepared by the KPMG member firm in the Czech Republic

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