Tax return 2024: Tax base deductions and tax discounts

What tax deductions you may be eligible to in 2024? The below article may provide you with some guidance.

Tax base deductions

Providing all legislative conditions are met, it is possible to lower the tax base by so-called tax base deductions. The main tax base deductions are:

1. The total interest on a mortgage or construction saving loan in a maximum amount of CZK 150,000. It has to be used to finance personal housing needs. A limit of CZK 300,000 applies to mortgage contracts for financing properties purchased before 1 January 2021.
2. Contributions to supplementary pension insurance, long-term investment product (DIP) or life insurance. They have to comply with specific conditions. Maximum amount is CZK 48,000 per year.
3. Gifts made to certain entities for specific purposes (e.g. humanitarian, charity, ecological purposes). They have to amount to at least 2% of the tax base or CZK 1,000. The maximum amount that may be deducted is 30% of the tax base.
4. Unpaid blood donation – CZK 3,000 per donation.

Tax discounts

It is possible to lower the tax liability by applying additional tax discounts. The highest and most common applicable discounts are as follows:

1. Taxpayer’s personal tax discount of CZK 30,840. It is applicable to everyone automatically.
2. Spousal tax discount of CZK 24,840. The spouse has to live in the same economic household as the taxpayer. Their annual income cannot exceed CZK 68,000 and they must take care of a child under the age of 3 (this is a new condition from the tax year 2024).
3. Tax discount for dependent children; CZK 15,204 for one child, tax discount of CZK 22,320 for the second child, and tax discount of CZK 27,840 for the third and any additional dependent child.

Changes for 2024

The following tax deductions have been cancelled with effect from the 2024 tax return filing:

1. CANCELLATION: Kindergarten Fee Deduction
   This was a tax deduction for placing a child in a preschool facility. Starting from 2024, the nursery fee deduction has been abolished (the last time you could use this deduction was in the 2023 tax return). Parents could previously reduce their tax by the fees paid to kindergartens or daycare centers (up to a set maximum amount).
2. CANCELLATION: Student Tax Discount
   Based on the Ministry of Finance the main reason for its abolishment was the low effectiveness for typical students, for whom the standard taxpayer deduction would generally suffice.

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