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Taxes
There are three types of taxes in Czech Republic which are applied to real estate when its owner changes:- Sale tax,
- Purchased property tax,
- Inherited property and property obtained as a gift tax.
In all the above cases it's required to pay the tax and publish corresponding report within one month (30 days) frame starting the moment the purchase was recorded. The report should be posted to region tax inspectorate.
Sale tax is fixed on 3% of the apartment price. The price is calculated as a maximum one between sale amount and market price.
Purchased property tax depends on a city: in various areas the amount may differ. This tax is calculated basing on different values, like apartment or house area, number of the house floors and other conditions which affect property price. Talking about Prague, the coefficient is fixed in the entire city on a value of 5. Which means that for 180 sq.m. apartment you will have to pay 850 koruna a year.
Inherited property tax is being held from the new owner and depends on numerous factors (property type, how the property is used, area, etc.).
If annual tax doesn't exceed 1000 koruna, it has to be paid before May 31st. If the amount is more than 1000 koruna, one can pay in 4 steps during 4 months (May, June, July, August).
A person living in owned property for more than two years is no longer required to pay purchased property tax. Similar condition is also available to ones who sold property, who owned it for more than 5 years before the actual sale. As selling new house or apartment is not considered as ownership change, development companies don't pay this tax at all. It's possible to avoid some part of the tax, if the property is registered to the company and not the person: instead of changing property owner it's possible to change a company owner. Of course this scheme is not always applicable.