The tax legislation of the Czech Republic strictly regulates liability for any violations — from delays in filing tax returns to incorrect calculations and non-payment of taxes. For failure to meet deadlines and comply with requirements, various fines, interest charges, and administrative sanctions apply. This article provides a detailed overview of tax penalties and sanctions for violations of Czech tax law in 2025.
Types of Tax Sanctions in the Czech Republic — What Businesses Need to Know
In the Czech Republic, tax law provides for several types of penalties for tax-related violations, each with its own calculation and enforcement mechanism. To properly assess potential business risks, it is important to understand the differences between them.
- Fines (Pokuty)
These are fixed amounts imposed by the tax authority for specific formal or administrative violations. For example, missing the deadline for submitting a tax return, failing to register when required, or obstructing an inspection. Fines are always set in Czech crowns and may be imposed once or repeatedly for each violation. - Late Payment Interest (Úrok z prodlení)
If tax is paid after the statutory deadline, the tax authority charges interest for each day of delay. The interest rate is based on the current base rate of the Czech National Bank plus an additional 8 percentage points. Interest is charged automatically as compensation for the state not receiving the funds on time. - Tax Surcharge (Penále)
Penále applies when a tax audit reveals that a business has underpaid tax or has unlawfully reduced a tax deduction or loss. In such cases, an additional percentage of the reassessed tax amount is charged. Penále is not applied if the company identifies the error itself and voluntarily corrects it before the start of an audit.
Each of these penalties is applied depending on the nature and severity of the violation. In the following sections, we will examine each category in detail and explain in which situations and in what amounts liability applies.
Fines (Pokuty)
The full list of tax-related fines under Czech law is a matter for legal practice. In this section, we will focus on the main and most common fines that businesses may encounter when violating tax rules in the Czech Republic.
Breach of Tax Confidentiality (Porušení mlčenlivosti)
For disclosing information protected by tax secrecy, the tax authority may impose a fine of up to CZK 500,000 (§ 9 of the Tax Code — Daňový řád).
Obstruction of Tax Proceedings (Pořádková pokuta)
If a company ignores official requests, fails to provide documents, or otherwise interferes with a tax inspection, it may face a fine of up to CZK 50,000 (§ 247 of the Tax Code — Daňový řádu).
If the tax authority considers the actions to be a serious obstruction, the fine can be increased to CZK 500,000. Such fines may be imposed repeatedly for each violation.
Late Filing Penalty (Pokuta za opožděné tvrzení daně)
If a tax return is submitted more than five working days after the statutory deadline, a penalty applies (§ 250 of the Tax Code — Daňového řádu):
- 0.05% of the tax amount for each day of delay
- 0.05% of the tax deduction amount for each day
- 0.01% of the tax loss amount for each day
The maximum penalty is 5% of the assessed tax, but not more than CZK 300,000.
If the return is filed late but within 30 days, and it is the only such violation in the year, the penalty is reduced by half.
If the return is not submitted at all, the minimum penalty is CZK 500.
Additionally, if the total penalty amount does not exceed CZK 1,000, the tax authority may choose not to collect it.
Penalties for Missing Deadlines or Rules for the VAT Control Statement (Kontrolní hlášení)
Penalties for breaching obligations related to the control statement (kontrolní hlášení) in the Czech Republic range from CZK 1,000 to CZK 500,000, depending on the nature and severity of the violation. If the taxpayer fails to submit the control statement on time — even by just one day — the following penalties automatically apply:
- CZK 1,000 — for late submission if done voluntarily, without a summons from the tax authority
- CZK 10,000 (or CZK 5,000 for sole traders and limited companies with a single natural person as the shareholder) — for submitting the control statement after being summoned but within the extended deadline
- CZK 30,000 (or CZK 15,000) — for failing to submit or correct (add, amend, or confirm) data as requested by the tax authority within the given timeframe
- CZK 50,000 (or CZK 25,000) — for completely ignoring a repeated summons or missing the deadline for submitting a corrected control statement
- Up to CZK 500,000 — if the taxpayer systematically fails to meet tax obligations and obstructs the work of the tax authority (e.g., concealing data, sabotaging submissions, etc.)
Since 2023, the law has introduced relief measures: if the control statement is breached for the first time in a calendar year, the tax authority may choose not to impose a fine. From the same year, most fixed penalties have been reduced for sole traders and limited companies with a single natural person as shareholder — provided this status applies at the start of the quarter when the violation occurred.
It is important to note that, unlike other taxes, there is no grace period of 5 working days for control statements — any violation is recorded immediately. Upon receiving a summons from the tax authority to correct errors, the taxpayer has exactly 5 working days to resolve the issue. Missing this deadline results in an automatically higher penalty.
Procedural Fine (Pořádková pokuta)
A procedural fine applies if a taxpayer obstructs the work of the tax authority or ignores its lawful requests. For example, if a company fails to provide requested documents, does not appear when summoned, or otherwise hinders an inspection.
The amount of such a fine depends on the nature of the violation and can be up to CZK 50,000. In the case of a serious obstruction, the tax authority may increase it to CZK 500,000 (§ 247 of Act No. 280/2009 Coll., Tax Code — daňový řád).
A procedural fine may be imposed multiple times if the taxpayer continues to evade their obligations.
Fine for Non-Payment and Failure to Register for Radio and TV Licence Fees (Koncesionářské poplatky)
From 2025, all companies and sole traders in the Czech Republic are required to register for paying television and radio licence fees (Česká televize and Český rozhlas), even if they do not use receivers directly. This requirement is set out in § 9(6) of Act No. 348/2005 Coll., on Radio and Television Fees.
Failure to register is subject to a fine of up to CZK 10,000 for television and up to CZK 5,000 for radio. The same amounts apply in cases of non-payment.
If a company with more than 25 employees fails to provide information about the number of staff, the fine may reach CZK 15,000. Penalties may be imposed repeatedly if obligations are not met.
Late Payment Interest (úrok z prodlení)
If tax is paid after the statutory deadline, the tax authority charges interest for each day of delay. The interest rate is based on the current base (repo) rate of the Czech National Bank plus 8 percentage points. Interest is applied automatically and serves as compensation for the state not receiving the funds on time (§ 252 of Act No. 280/2009 Coll., Tax Code — daňový řád).
Interest begins to accrue from the fourth day after the due date for tax payment. The first three days of delay are not counted.
Current Rate (Současná sazba)
The rate is calculated using the formula:
ČNB repo rate + 8%.
For the first half of 2025, this equals 11.75% per year, based on a repo rate of 3.75%.
Minimum Threshold for Charging (Minimální hranice pro úroky)
If the total interest for the entire period does not exceed CZK 1,000 for a single tax obligation, the tax authority will not collect it (§ 252(6) of the Tax Code — daňového řádu).
Interest in Case of Approved Deferral or Instalments (úrok z posečkání)
If a taxpayer is granted a deferral or an instalment plan for paying tax, a reduced interest rate applies — set at half the standard rate (§ 157(2) of the Tax Code — daňového řádu). This means half of the rate calculated as repo + 8%.
Tax Sanctions (penále)
As mentioned earlier, tax sanctions are a separate type of liability applied in cases of unlawful reduction of a tax deduction or overstatement of a tax loss. Unlike fines, these sanctions are not fixed amounts but are calculated as a percentage of the adjusted tax figures.
Sanction for Additional Tax Assessment (penále za doměrek daně)
If, during an audit, the tax authority reassesses and increases the amount of tax due, a sanction of 20% of the additional tax amount is applied (§ 251 odst. 1 písm. a) zákona č. 280/2009 Sb., daňový řád).
Sanction for Reduction of Tax Deduction (penále za snížení odpočtu)
If the tax deduction is reduced as a result of an audit, a 20% sanction on the reduced deduction amount is also applied (§ 251 odst. 1 písm. b) daňového řádu).
Sanction for Reduction of Tax Loss (penále za snížení daňové ztráty)
If the tax authority reduces a previously declared tax loss, a sanction of 1% of the reduced loss amount applies (§ 251 odst. 1 písm. c) daňového řádu).
If both an additional tax assessment and a reduction of loss occur at the same time, only the higher rate — 20% — is applied.
When the Sanction Does Not Apply
If the taxpayer identifies an error and submits a corrective tax return before the start of a tax audit, no sanction is applied (§ 141 odst. 7 daňového řádu).
The amount of tax sanctions is always calculated according to a set formula and does not depend on the discretion of the tax authority.
Appealing Tax Penalties
If you are faced with tax fines, interest charges, or sanctions, you have the right to appeal them in accordance with the established procedure.
Reduction or Remission of Tax Sanctions
If the tax authority has imposed a sanction for additional tax assessment or reduction of a loss, you can submit an application to have the amount reduced. The application must be filed within three months from the date you were notified of the sanction (§ 259b zákona č. 280/2009 Sb., daňový řád).
A mandatory condition is the full payment of both the tax and the imposed sanction before submitting the application. The tax authority may reduce the penále amount by up to 75%, but it cannot be fully waived.
Cancellation or Reduction of Fines and Late Payment Interest
Penalties for late filing of a tax return (pokuta za opožděné tvrzení daně) and late payment interest (úrok z prodlení) can also be appealed.
Partial or full relief may be granted if the delay occurred for valid reasons — for example, due to serious illness, a natural disaster, or a major failure of electronic systems (§ 259a daňového řádu).
Considering Tax History (Posouzení daňové historie)
When reviewing such applications, the tax authority takes into account the taxpayer’s history of compliance. If the company has previously fulfilled its tax obligations diligently, the chances of having sanctions reduced are higher.
If you have been charged fines or sanctions that you believe are unfair, contact the specialists at DoMyTax — this will increase your chances of a successful appeal.
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