Compensation bonus for associates approved

On Thursday 28 May 2020, the Chamber of Deputies approved the original governmental amendment to the Compensation Bonus Act, thus rejecting the amendment suggested by the Senate. The Senate had proposed that the financial aid would be paid as a contribution to a private individual from the state budget only. According to the approved bill, the bonus would be paid also from budgets of districts and municipalities.

The compensation bonus can be drawn by associates of small companies ("s.r.o.") under the condition that there are not more than two associates in the company (there can be more if they are members of one family). However, applicants cannot be employees participating in health insurance, they cannot draw contributions from the Antivirus programme (known as "kurzarbeit"), and they cannot draw the similar compensation bonus intended for self-employed persons. The compensation bonus is not for associates in companies that filed for bankruptcy, that are in liquidation, or that are unreliable VAT payers.

Another condition for drawing the bonus is that the turnover of the companies in 2019 must be at least CZK 180,000 (or there is a reasonable presumption that it would be in 2020 or 2021). The companies must be tax residents in the Czech Republic, the European Union, or the European Economic Area. In addition, applicants must be active associates of the company as at 12 March.

The form for applying for the compensation bonus should be filled out and send to the respective financial authority (more information here). The compensation bonus can be drawn for the period from 12 March to 8 June 2020, and the paid amount is CZK 500 per day, i.e. the total amount can be CZK 44,500.

The president signed the bill, and it was published in the Collection of Laws on 1 June 2020. The bill comes into effect on 2 June 2020.