Who Needs to File a Property Tax Return in the Czech Republic, Even If They Didn’t Buy Property Last Year?

In the Czech Republic, property tax returns are typically filed by taxpayers who purchased real estate during the previous year. However, in 2025, as in previous years, others may also be required to file. Read on to find out if you fall into this category.

Who Needs to File a Property Tax Return?

Taxpayers must file a property tax return if their circumstances affecting tax calculations have changed. This primarily includes individuals who acquired ownership of land, taxable buildings, or residential or commercial premises in 2024. A return must also be filed by those who made changes such as adding an extension, constructing a superstructure, or partially disposing of a property last year, provided these changes affected the type or size of the property – such as a change in land area or an increase in the number of floors.

Additionally, changes to land area due to updates in the cadastral register are also considered significant for tax purposes.

This year, however, other groups of taxpayers are also required to submit a new declaration. Specifically, this applies to the following situations:

Forest Lands

Starting in 2025, parts of forest lands that contain protective forests or special-purpose forests will no longer be subject to land tax. In other words, only the portions of forest land related to protective or special-purpose forests are exempt from taxation. However, land used for commercial forests will still be taxable. In the previous tax year, forest areas with protective or special-purpose forests were fully exempt from tax. Due to this change, taxpayers will need to file a property tax return for the 2025 tax year.

Changes to the Method of Determining the Tax Base for Forest Areas

Taxpayers who had their tax base for forest areas in the 2024 tax year determined based on land prices in accordance with the price standards in effect on January 1 of the tax year will also need to file a property tax return for forest areas.

Beginning in 2025, the tax base for forest land can no longer be determined using the alternative method of land pricing according to the rules in effect on January 1 of the tax year.

Expanded Tax Relief for Environmentally Significant Elements

As of the 2025 tax year, additional environmentally significant elements will be exempt from tax. These include landscape gardens, terraces, individual trees, and rock gardens, provided that these elements are registered in the register of environmentally significant elements according to the Agricultural Act. To claim the exemption in the 2025 tax return, the element must be registered in the environmentally significant elements register as of January 1, 2025.

Changes to Conditions for Exemption of Buildings Located on Railways, Airways, Waterways

Under the Real Estate Tax Act, taxable buildings located on railways, airways, waterways, and ports may be eligible for an exemption if they are used for public transport in accordance with a building permit. However, the exemption only applies if the building is not used for any business other than public transport, and it is not rented or leased for purposes other than providing public transport. If only part of a building or facility qualifies for the exemption, only that portion will be exempt.

Taxpayers whose eligibility for this exemption changes starting January 1, 2025, are required to file a tax return for the 2025 tax year.

Exemption for Public Parks, Playgrounds, and Sports Fields

The exemption for land used for public parks, playgrounds, and sports fields has been updated. It now applies to land that contains public open spaces, sports fields, or publicly accessible dedicated roads.

The updated provision clarifies the term “publicly available space” which has now been defined as “public spaces.” This includes squares, streets, marketplaces, sidewalks, public green spaces, parks, and other areas that are accessible to all without restriction — i.e., for public use — regardless of ownership under municipal law. Public parks are included in this definition.

If the land is used for business purposes, rented, or leased, the exemption does not apply. If the exemption applies to the entire land, there is no need to declare it in the tax return. However, if the exemption applies only to part of the land, that portion must be included in the tax return.

Taxpayers who have already claimed an exemption under Section 4(1)(l) of the Real Estate Tax Act as amended by December 31, 2024, are not required to file a tax return for the 2025 tax year. If not, the tax return must be filed by January 31, 2025.

Tenants of Buildings and Structures as Taxpayers

In previous years, tenants or lessees were not considered taxpayers for buildings and structures if they were residential buildings or taxable units, such as apartments, basements, or storage rooms managed by the State Material Reserves Administration or transferred to the Ministry of Finance through privatization. However, this exception will no longer apply starting in 2025. As a result, these tenants must now file a tax return for the 2025 tax year.

A similar rule applies to individuals using residential buildings or taxable units, which include apartments or basements, where the ownership is unknown or managed by the State Land Administration or the State Property Representative Office. However, this only applies if the property is being used for commercial purposes. These tenants or users must also file a tax return for the 2025 tax year if they rented, leased, or used the property for business activities.

Changes to Coefficients Starting in 2025

Starting in 2025, the special coefficient of 1.5 for garages, recreational properties, and commercial buildings will no longer apply, and municipalities will no longer be able to use it. However, municipalities now have the option to introduce a new local coefficient for businesses and other buildings that were previously subject to the 1.5 coefficient. Additionally, the basic tax coefficient can no longer be reduced; it can only be increased by one category.

Another change is that the population of municipalities and cities, which is used to determine the basic tax coefficient, will now be based on Decree No. 250/2024. This will be calculated according to the percentage of individual municipalities in the national gross value-added tax and income tax revenues, instead of the results of the last population census, as was previously done.

The local coefficient has also been updated and can now be determined in five ways: for the entire municipality, individual cadastral areas, specific municipal or urban districts, particular groups of real estate (e.g., recreational buildings), or individual real estate objects. If multiple local coefficients are established within a city, only one will be calculated for each property.

It’s important to note that no declaration is needed to change the coefficients.

When to File a Tax Return

The deadline to file your tax return is Wednesday, January 31, 2025. If you miss the deadline, a penalty of 0.05% of the assessed tax will be added for each day of delay, up to a maximum of 5% of the assessed tax (with a cap of CZK 300,000). You can be late for a few days without facing a penalty if the amount owed doesn’t exceed CZK 1,000.

How to File a Tax Return Electronically

Taxpayers have the option to file their tax return either on paper or electronically. You can file electronically through the My Taxes portal, which will guide you through the process, perform calculations, and check for any errors. You can also take advantage of the pre-filling service, which imports data from the tax office and land registry through the tax information block (DIS+) on the portal.

Previously, individuals with access to the information box had to file property tax returns electronically, but that rule has changed. Now, this obligation applies only to those legally required to access the data box.

The purpose of the specific data box matters. For instance, if a person only has access to the data box for a business owner, they don’t have to file a property tax return electronically unless the property is related to the business.

If you’re required to file electronically but fail to do so, you could face a fine. However, the tax administrator will first give you an opportunity to correct your mistake and submit the return electronically. If you ignore this offer, you’ll be fined CZK 1,000.

If you have any questions about your taxes, business, or accounting in the Czech Republic, feel free to request a consultation with 360WEDO’s savvy specialists. They will help you with your finances according to the relevant Czech laws.

source:

https://www.podnikatel.cz/aktuality/kdo-musi-vyplnit-priznani-k-dani-z-nemovitosti-i-kdyz-loni-zadnou-nemovitost-nekoupil