Czech real estate tax and transfer rules for companies that own property

A foreign group buys a small office building in Prague through a newly formed s.r.o., signs the contract in March, and assumes the tax side is finished. It is not. There is an annual property tax to register for, a VAT question hiding in the purchase price, a depreciation schedule to set up, and a cadastre entry whose date decides who is liable for what. None of this is exotic. It is simply spread across four authorities and three laws.

This piece covers the principles for companies. Individuals buying a home are dealt with in our explainer on Czech annual property tax, which this article builds on. Rates and coefficients change, so check current figures with the Financial Administration.

The annual tax: same rules, different habits

The real estate tax (daň z nemovitých věcí) is governed by Act no. 338/1992 Coll. It has two parts, tax on land and tax on buildings and units, and it is charged on the owner as recorded in the Cadastre of Real Estate on 1 January. A company has no special status: it pays on the same basis as a private owner.

What differs is the type of property. Buildings used for business, whether offices, warehouses, shops or hotels, are taxed at rates that differ from residential buildings, and the calculation depends mainly on built-up area, with coefficients for the category of building and for the municipality. Land is assessed by area or, for farmland and forest, by an official price. Municipalities can apply a local coefficient within a range set by the law, and Prague's City Hall publishes its own decree, so the same warehouse in two towns can face quite different bills.

A company files a return when it acquires property or when something relevant changes, such as area or use. The deadline is 31 January of the year after the change, and the tax is due in May, with a second instalment in November if the amount is large enough (as of 2026; check the official source). A company that owns many properties may find that its accountant files a single return listing each parcel and building by cadastral number.

The old transfer tax is gone

Czechia once charged a property acquisition tax (daň z nabytí nemovitých věcí), paid by the buyer and, from 2014, by the buyer alone. It was abolished in 2020, and the abolition was made retroactive for transfers registered in the cadastre from 1 January 2020. Older guidance that mentions a four per cent transfer tax describes the previous regime and should be treated as history. Our piece on the history of property purchase taxes gives the background.

For companies, abolition changed the way deals are structured less than one might expect. The reasons to buy shares in a property-owning company rather than the building itself now rest on liability, contracts and VAT, not on a tax saving that no longer exists.

VAT on buying and selling property

VAT is where company property deals get technical. In broad terms, the supply of a building is split by age. A sale of a new building, or one sold within a statutory period after its first occupancy, is subject to VAT. A sale of an older building is normally exempt from VAT. Land intended for building is taxable, while other land is generally exempt. Between VAT payers it is often possible to opt to tax an otherwise exempt supply, which allows the seller to recover VAT on its own costs and passes the choice to the buyer.

The consequences are real. A buyer that is a VAT payer and plans taxable activities in the building will usually prefer a taxable sale, because it can deduct the VAT. A buyer that carries out exempt activities cannot. The rules for the periods, the option to tax and the adjustment of deductions over time are detailed, and a mistake can be expensive years later. See also Czech VAT explained.

Income tax: depreciation and gains

For corporate income tax, a building held as a business asset is depreciated over a long statutory period (as of 2026; check the groups in the Income Tax Act). Land is not depreciated. The company can choose between straight-line and accelerated depreciation for most assets, but the choice has to be made once and recorded. Repairs are expensed, while improvements above a threshold are capitalised, a distinction the tax office examines.

When the company sells the property, the gain is part of its ordinary corporate income, taxed at the general corporate rate, which is 21% (as of 2026; check the official source). Unlike a private seller, a company does not benefit from the ten-year holding test that can exempt some individual sales. Details of the rate and base are in Czech corporate income tax explained.

How a transfer is registered

In Czechia ownership of real estate passes on registration in the cadastre, which is run by the Czech Office for Surveying, Mapping and Cadastre (ČÚZK). The parties file a registration request (návrh na vklad), pay the fee, and the cadastral office decides. The administrative fee has been a fixed sum for years (as of 2026; check the cadastre's fee schedule). Procedure and risks are covered in our guides to the land registry and to reading a property extract.

Company buyers should check the extract for encumbrances such as mortgages, easements and lis pendens notes, and confirm that the signatory has authority to bind the seller. A commercial register extract shows who can sign. The practical advice found in the notaries and escrow guide applies here with extra force, since the sums are larger.

Share deals versus asset deals

A buyer can acquire the building from the seller (an asset deal) or the shares of the company that owns it (a share deal). The asset deal puts a clean title in the buyer's hands and triggers VAT and registration. The share deal leaves the building where it is and transfers the company, with all its history and liabilities, which makes due diligence more important. Free public registers are a good start, as our piece on company due diligence explains.

What goes wrong

Companies miss the first return in January, often because the purchase was made by an acquisition vehicle with no internal accountant yet. They assume a price quoted net of VAT includes it, or the reverse. They forget that a lease with a tenant can address who bears the tax but does not change who owes it to the state. And foreign owners forget to register a data box and miss official letters.

The data box matters here: the tax office writes to a company through it, and a letter is deemed delivered after a fixed number of days. If you have not set one up, read our guide to the data box.

Frequently asked questions

Do companies pay a different property tax from individuals?

No. The same Act applies, though business buildings fall into categories with different rates from residential ones.

Is there still a transfer tax when a company buys property?

The acquisition tax was abolished in 2020. VAT, income tax and the cadastre fee may still apply.

Who pays the property tax if we sell in the middle of the year?

The owner shown in the cadastre on 1 January pays for that whole year. Parties often agree in the contract how to share it, but the state looks only to the registered owner.

Where to check

The Financial Administration publishes the forms and deadlines, and Prague City Hall and each municipality publish local coefficients. The cadastre office explains registration. For a first acquisition, a tax adviser's hour is cheap compared with a mistake in the VAT treatment.

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