SME Info Czechia 2022-1 Payroll Legislation

Changes in payroll legislation effective from 1.1.2022 – SME Info Czechia 2022-1

We shortly summarize changes of Czech legislation relating to payroll. It is summarizing some regular annual updates of certain thresholds as well as some expected changes from recently passed legislation.

Download here the English+Czech bilingual pdf of this newsletter:
Changes in payroll legislation effective from 1.1.2022 – SME Info Czechia 2022-1

 

Minimum salary

  • The minimum salary will increase to CZK 16 200, which is results into the following two changes
  • Increase of the limit for application of the higher tax rate (23%) to the amount of tax base exceeding CZK 155 644 per month (CZK 1 867 728 per year)
  • Increase of the annual ceiling for social insurance contributions to CZK 1 867 728

Tax benefits

  • The basic tax credit increases to the annual amount of CZK 30 840 (CZK 2 570 per month)
  • The tax credit increases for the second, third (and every other child)
    • Child 15 204 CZK per year / 1 267 CZK monthly (unchanged)
    • Child 22 320 CZK per year / 1 860 CZK per month (valid from 1.7.2021 – but can be applied only as part of the annual tax reconciliation or tax return)
    • And each additional child 27 840 CZK per year / 2 320 CZK per month (valid from 1.7.2021 – but can be applied only as part of the annual tax reconciliation or tax return)
  • The maximum limit of the monthly tax bonus was abolished (until 2021 this limit was CZK 5 025)
  • The value of the exempted meal voucher lump sum increased to CZK 82.60 (CZK 75.60 in 2021)
  • Reduction of the maximum limit for the deduction of interest for “housing needs” to CZK 150 000, but only if the housing need was procured from 1 January 2021

Paternity leave

  • Paternity leave increased to 2 weeks (the original value was 1 week)

 

 

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You can download our bilingual newsletter in English + Czech here:

Changes in payroll legislation effective from 1.1.2022 – SME Info Czechia 2022-1

 

The purpose of SME INFO is to provide general information and to draw the attention to the current changes in law which we believe to be important for the business operation of our clients. It is not a replacement for careful review of the acts and rules and the consultation with your tax advisor.
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