- the possibility of obtaining a residence permit for up to one year upon initial registration and then for 1-2 years upon renewal of the company;
- economic and political stability;
- obtaining the status of a European company;
- low taxation; the ability to open accounts for a company in respectable European banks.
The Czech Republic is located in the very center of Europe and borders Germany, Poland, Austria and Slovakia. The territory of the republic is almost 78,864 square kilometers. The capital of the Czech Republic is Prague.
Types of companies and their characteristics:
A pleasant innovation for entrepreneurs in the Czech Republic is the opportunity, since 2014, to open a limited liability company (s.r.o.) with an authorized capital equal to only one kroon. Nowadays, the reduction of administrative and financial difficulties when starting a business has already become a global trend.
A limited partnership can be formed by two or more partners, each of whom must contribute at least 5000 kroons to the capital of the company.
A general partnership can be formed by two or more partners, each of whom has unlimited joint and several liability. No share capital is required.
Joint-stock company. The minimum share capital is 2 million kroons for a closed company and 20 million kroons for an open company.
New companies must be registered in the commercial register within 90 days from the date of formation. Founders must draw up articles of association, bank account certificate, copies of relevant trade licenses, proof of no debt from tax authorities, and other documents, including police records (if any). Registration fee is 5000 CZK.
Business registration in the Czech Republic is a fairly quick and easy process, although preparing the necessary documents is often a rather difficult stage. Registration of companies is under the jurisdiction of the judiciary. The company is registered in the regional arbitration court.
Permits and licenses
Permits are also required for certain types of businesses, including:
financial institutions such as banks and insurance companies;
Like many Central European countries, the Czech Republic has worked to lower tax rates, create a favorable business environment and stimulate investment. However, the taxation system remains quite complex.
Czech companies must register with the local tax authority within 30 days of their registration. The tax year runs from January to December, and companies must submit their tax returns by March 31st after the end of that year.
Corporate tax is levied on all profits of the company and is currently 19%. The tax must be paid every six months or quarterly and is based on the previous year's profit.
Value added tax is currently 19%. The taxable base is the sale and purchase of goods and services in the Czech Republic, unless they are intended for export from the countries of the European Union (EU).
Traders with a turnover of 1 million kroons or more in the last 12 months must register as a VAT payer at the local branch of the Ministry of Finance. VAT numbers are not issued as in the UK, instead a single TIN is issued for all administrative purposes.
A reduced rate of 9% applies to a range of construction works and imported antiques and art.