Czech property tax calculation: coefficients and the local multiplier

When two owners compare property tax bills for flats of the same size and find that they differ by a large multiple, they usually suspect an error. Often there is none. The bill is a product, and the factors in the product depend on where the flat is. A flat in a large city carries a higher statutory multiplier than one in a small town, and a municipality can add another on top.

This explainer takes the calculation apart. We keep to the structure, because the rates and coefficients are amended from time to time and a number printed here would age. For the basics of who pays and when, read our guide to the annual property tax. For the practical side for owners living abroad, see property tax for foreign owners.

The shape of the formula

For most buildings and flats, the tax is a chain.

The result is the tax for that property. If you own several properties, each is calculated, and the amounts are added. For a flat in a block, the land under the building is reflected in the unit's coefficient rather than taxed as a separate plot (as of 2026; check the Financial Administration).

Three multipliers, three authors

The multipliers differ in who sets them and how often they change.

The first multiplier is why a big city costs more than a village for the same area. The law ranks municipalities by population and gives each band a coefficient, from 1.0 for the smallest to 4.5 for Prague, and a municipality can move its own figure within limits by decree. The second is the one municipalities fight over. Since the 2024 reform a municipality can set a local coefficient anywhere in the statutory range in steps of one tenth, and from 2025 it can also set it below 1 to cut the tax; the decree applies from the following year (as of 2026; check the Financial Administration). A town that wants more revenue can raise it. A town that wants to attract residents can leave it at the neutral value or lower it. The third is technical. From 2025 an inflation coefficient can update the tax so that its real value is not eroded. The Ministry of Finance announces it each year, and it was set at 1.0 for 2025 and again for 2026, so it has not yet added anything to bills.

Our explainer on Czech regions and municipalities shows how local government is organised and why municipalities have this power: the revenue from the tax goes to the municipality where the property stands.

A hypothetical illustration

Take a hypothetical 70 m² flat. Its base is 70 × 1.22 = 85.4 m², and at CZK 3.50 a square metre the basic amount is about CZK 299. In a municipality with a size coefficient of 2 and no local coefficient, the tax is about CZK 598. If that municipality adopts a local coefficient of 3, the multipliers combine and the tax becomes about CZK 1,793; at 5 it would be about CZK 2,989. The same flat under Prague's size coefficient of 4.5, before any local coefficient, comes to about CZK 1,345. The flat and the local coefficients are invented to show the effect of each factor; the real values are in the law and in the decree for the year of the bill.

The point of the exercise is that the local coefficient scales the bill proportionally. A neighbour who moves from one municipality to another with the same flat can see the tax multiply or fall by a large fraction, without anything else changing.

Land, garages and mixed use

The same chain applies to land and to non-residential space, with different bases and rates. A flat in a block carries a share of the land under the building, so the owner's bill includes a small land component. Garages and similar buildings have their own rate category, which is why a parking space sold as a separate unit has its own line in the calculation; our explainer on parking spaces and cellars sold with flats shows how such spaces are registered. Space used for business is generally taxed at a different rate from space used for living, so an owner who lets a flat to a company or runs a practice from it should tell the tax office about the use. Whole buildings taxed as such, rather than as units, also carry a surcharge for each floor above the first. Each of these is set out in the Act and in the Financial Administration's guidance, and each can be amended.

An owner who suspects a mistake has simple options. Check the area and use in the cadastre. Check the decree for the year of the bill. Compare the municipality's coefficient with the one on the assessment. If the numbers do not match, write to the tax office with the evidence and ask for the calculation to be reviewed, within the time allowed for objections.

Where the numbers come from

Three places hold what you need.

The Act on Real Estate Tax, as amended, lists the rates, the size-of-municipality bands and the allowed local coefficient values. It is available in the legal database, and the Financial Administration publishes guidance on its website.

The municipal decree. A municipality that applies a local coefficient publishes it as a generally binding decree on the official board and the website. Search for the municipality's name with "real estate tax" or its Czech equivalent. For Prague, the decree is issued by the city, not by the individual districts, and it can set different values for different parts of the city. If no decree is published, no local coefficient applies.

The cadastre. The base is taken from your entry: the area and the type of property. If the area in the register is wrong, the tax will be wrong too. Our guide to reading an ownership extract shows where to find it.

Why it matters for a purchase

Property tax is a small part of the cost of ownership, but it is a repeating one, and it differs by place. If you are comparing a flat in Prague with a house in a commuter town, include the local tax in the running costs. Homes around Prague are listed in the new-build section for the Prague area on Novostavby.com (in Czech), and flats in the city in the Prague section (in Czech). Each project's municipality has its own coefficient. Our guide to the real cost of buying a flat puts the tax beside the other costs.

Landlords include the tax in their costs. The service charges and building funds are separate payments to the owners' association; the property tax goes to the state and the municipality.

What can change the bill

Several things beyond the multipliers alter the tax. A change of use, such as converting residential space to business use, changes the rate. A change of area, such as an extension, changes the base. A new owner files a return at the start. Exemptions exist for certain categories of property and owners, and they depend on conditions in the law; ask the tax office in writing if you think one applies. The return is due by 31 January (moved to the next working day when that falls at a weekend, as in 2026) and only when something changes. The tax is paid by 31 May, or in two halves by 31 May and 30 November when it exceeds CZK 5,000 (as of 2026; check the Financial Administration).

Frequently asked questions

Frequently asked questions

Why is the tax higher in Prague than in a small town?

The law gives larger municipalities a higher coefficient, 4.5 for Prague, and a municipality may add a local one. The base and rate are the same for the same property.

Who sets the local coefficient?

The municipality, by a generally binding decree published on its official board. If it has not adopted one, no local coefficient applies.

Does the price of the flat affect the tax?

For most flats, no. The tax is based mainly on floor area and use, not market value.

Where do I find the current rates?

In the Act on Real Estate Tax (zákon č. 338/1992 Sb.) and on the Financial Administration's website. Base rates rose in 2024, and the inflation coefficient has stayed at 1.0 so far.

A practical next step

Find your municipality's decree and write the three multipliers on one line. Multiply them with the adjusted floor area and the rate, and compare the result with the bill. If they differ, ask the tax office why.

This is a general explainer, not legal, tax or mortgage advice.