Windfall tax 2023

The financial administration has published answers to questions regarding the windfall tax that is to be applied between the years 2023 and 2025. The incurring of liability for the tax shall be assessed individually for each tax period. The basic condition is the reaching of a decisive annual income of at least CZK 50 million in a tax period that falls at least partially within the period of the application of the windfall tax. Regarding the determination of a groups of taxpayers that will be deemed liable to the windfall tax, the total of decisive income shall be calculated as the sum of the individual income realised by each member of a group - including cases when the parent company is abroad. Such income includes the income of a Czech company and the income of a foreign company that is taxed in the Czech Republic.

The windfall tax is not subject to special registration. Windfall tax returns are subject to the same deadlines as income tax returns - including cases when the taxpayer in question has zero tax liability. The windfall tax is not a tax-deductible expense and there is no tax relief that a taxpayer could use for the purposes of corporate income tax. It is an advance tax, and the same rules that govern income tax deposits are used regarding the last known tax liability.