The Czech Republic in recent years has gained in the popularity as a location for running a business. Setting up an LTD company in the Czech Republic has many benefits over other countries. Because of this, we can see a growth in newly set up companies in the Czech Republic. Many companies from Poland decide to set up their business in the Czech Republic because of the tax benefits that their legal system offers.
The countrys’s model of an LTD company constitutes of partners and members of the board (directors). The directors bear the full financial responsibility for the company’s liabilities. This is a very clear situation that makes running a business registered in The Czech Republic easier.
The popularity of Czech companies is caused by a very liberal and clear tax system compared to other European Countries. The CIT (Corporate Income Tax) is very low and equals 19%. The VAT tax from most of the products is 21%. Personal income tax is only 15%, and for any financial gains, it equals to 15% as well. Additionally, the Czech Tax system allows diminishing the taxable revenue by 100% for any cars that were registered in the Czech Republic.
Benefits of running a company in Czech Republic:
- low taxes,
- very low social security fees,
- a lot of tax exemptions especially for equipment and cars,
- high demand in Czech market for products and services,
- little to none bureaucracy,
- simplified procedure for licence and permits,
- a very high understanding of administration in terms of tax fines,