The maximum tax benefit that can be used by parents whose children attend preschool institutions in 2017 was increased to 1100 korunas for each child.
The maximum discount in 2017 was 11 000 korunas, comparing to 9900 korunas available for taxpayers in 2016.
When completing the Declaration on Income Tax from the Population for 2017 which is to be submitted before the beginning of April or July 2018, do not forget to deduct a discount for placement a preschool child in a children’s institution from the tax. In the Czech Republic this discount is called školkovné.
This bonus can also be used by entrepreneurs who pay a fixed tax.
The state will meet taxpayers halfway when drawing up the declaration in 2019 as well. The discount for a child in a preschool institution will increase to 12,200 korunas in 2018.
The discount, of course, is applicable only to mothers and fathers who pay for the preschool education of their children in kindergartens or other children’s groups.
Only one of parents-taxpayers who resides with a child in owned household can be provided with the discount for a paid and approved child placement fee.
In the tax declaration, the legal right for the discount is granted when the payment confirmation for placing a child to a kindergarten is provided. The confirmation is applicable for the annual expenses for 2017.
In the tax declaration a new 69a line for this discount, indicated “Discount for placing a child”, is introduced. As a mandatory supplement, a child’s birth certificate and the confirmation from a preschool institution should be attached to the declaration.
Written confirmation should contain:
– a preschool institution;
– a street address;
– the first and the last name of a child;
– the child’s birthday;
– the amount of the placement fee;
– signature of a preschool representative;
Conditions to apply the discount (školkovné)
Your child visits a preschool/group, a kindergarten (public or private), any other similar institution such as a summer school, a nursery or a children’s center. Participating in school activities is not a valid condition.
Criteria a preschool institution should met:
1) it should be a kindergarten in accordance with the Law on Education or a similar institution abroad;
2) an institution should provide childcare services in specially equipped children groups;
3) a childcare institution should work on the basis of the license and has qualified personnel.
Other important points:
• regular attendance (not less than 6 hours per day);
• services outside family in children groups;
• providing services for children older than 1 year till the obligatory elementary school education;
• fulfilling a child’s needs.
Common or alternative way of parenting
As it was mentioned, only one of the parents can use the discount. The exception here is joint or alternative guardianship. In this case both households are considered.
If tuition fee is actually paid by both parents when a child stays in their home, both of them can use the bonus up to CZK 11,000 per year.
There are no limitations regarding the age of a child. The discount can be applied in case of postponing school entrance if the tuition fee has been covered. In addition, a child should reside in a household owned by both parents in this case.
A sole proprietor applies 60% write-off of expenses at a time for the calculation of income tax.
His profit reached 550.000 korunas in 2017. After deducting 60% of the expenses (lump sum costs), his tax base equals 220.000. The income tax (15% of the base) is 33.000 CZK. However, as his 4-year child attends the kindergarten and it costs 15000 CZK per year, he can deduct up to 11 000 from the tax amount. After deducting the taxpayer discount in the amount of 24 840 Czech korunas and paying for the kindergarten, he does not cover the state income tax (33 000 – 24 840 – 11 000 CZK).
If anything is unclear, we will be glad to shed some light on it!