As of November 1, 2016 the real estate transfer tax is no longer the responsibility of the seller but the buyer.
The real estate transfer tax is currently 4% and needs to be paid on either the purchase price or the valuation price, whichever is higher. Buyers are required to have a valuation of the property done by a state approved valuer.
Be informed about your real estate transfer tax obligations before signing
The reason for this change of responsibility was that it was sometimes difficult for the State to get payment from the seller. In these situations the buyer was the guarantor of the tax payment creating nasty surprises for those buyers unaware of their obligations. Everything should now be clearer for all parties and more secure for the State. The State is able to register a lien against the property of a non-paying buyer.
For those buyers and sellers in the middle of a transaction began before the Nov. 1, 2016 start date it is important to note that the new law takes precedent over provisions agreed in the purchase contract. Also, the date that the purchase contract is submitted to the Land Registry is the date that is used with regard to which law it falls under.
If you require legal assistance in a purchase please drop me an email: nathan@czechpoint101.com. We have purchase packages as shown here: www.czechpoint101.com/buying-a-property/ and our hourly legal rate is currently 1895 CZK/hr + VAT.
Updated/Aktualizováno: November 6, 2016,
Hello,
Can an UAE based company buy a land property in Czech Republic?
Or it would be better to buy a Czech sro which is the owner of a land property?
Thanks
Hi Mergen, Thanks for the question. What is the zoning on the land? Agricultural, residential, recreational? Nathan
hi,
i bought a house at the end of the 2017, directly from a developer, even so, since the house is composed from 2 units, it looks like i need to pay the 4% also.
at this moment i’m clueless where and how to pay.
this is something that your company can assist with ?
i mean filling in all the paperwork and just telling me the account where i need to feed the government ?
thanks,
Liviu
Hi Lviu, This tax does not apply to the first transfer of a newly constructed flat. If that is not the case with your units please send me an email: nathan@czechpoint101.com and we can take care of you. Nathan
Hi Czech Point
I Bought a newly developed house from a developer. The Sale price included taxes related to the purchase, on top of the Sale price. Based on your response to LVIU I understand it is not required, but do I have an obligation to notify tax authorities? I am a resident of Stredocesky Kraj, can you help?
Hi Gareth, You are correct that if it is a brand new development you will not have to pay the 4% real estate transfer tax. However, you are still required to register at the Financial Office for the yearly property tax. Hope this helps. Nathan
Hello Nathan, We bought a piece of land from local authority in 2012 to build a residential home. We have built the house and registered it in 2016.
My question is: if we are to sell the house will the date of land purchase can be considered as a start point for investment(6years) or we have to pay 4% capital gain tax?
Thanks,
Myra
Hi Myra, Thanks for your question. This 4% real estate transfer tax is not a tax on capital gains but a tax when a property is transferred. It has to be paid by the buyer and is distinct from any capital gains tax that the seller may have to pay. I hope that helps. Nathan
Hi Nathan
I e-mailed you for some info please.
Thanks
Best Regards
Ms Calleja
Question: I am purchasing a plot of land from a developer who is selling 17 plots and he will complete all the connections for electricity, water and waste.
As buyer, do i need to pay 4% purchase/transfer tax on the 1st time purchase of this land?
Hi Steve, Unfortunately I can’t help you with that. Our experience is in residential units. Nathan
Hello, the 4% is over the price with VAT or without VAT? If I buy a furnished flat, is the value of the furniture included in the 4% calculation?
Hi Pablo, If you are paying VAT I assume it is because it is a newly constructed flat or totally renovated flat. In such cases the real estate transfer tax does not need to be paid. It is only payable on the resale of flats. I hope this helps. Nathan
Hello Nathan,
I have purchased a 2nd hand apartment in Prague which is pending for registration in the Cataster. As far as I know, buyers are required to have a valuation of the property done by a state approved valuer. Could you please explain me how the procedure to get such a tax valuation works? Should I contact a state approved valuer? What is the period I have to get the tax valuation?
C.
Many thanks!
Hi Carlos, Yes, you need to get a State approved valuer to give a valuation. Then you submit to the Financial Office both the purchase contract and valuation along with a completed form. I believe it needs to be done within a certain amount of time but am not sure the exact time period – 3 months? If you want you could get in touch with Khuppi in our Prague office (khuppi@czechpoint101.com, +420 774 440 997). I’m sure he could recommend a valuer. We also offer a service to fill all the details for tax registration and submit it. Nathan
Hi,
Does this tranfer fee also apply when your partner (not married) owns a property and she would like to put the property on both of our names (as equal share holders, as I am currently paying the majority of the mortgage)?
B.
Hi Burry, Thanks for your question. I am not sure about that. It would be a question for an attorney. There is in Czech the law on “Joint Property of Spouses” which gives a married couple joint ownership of anything purchased while they are married. However, this would not apply in your case so I am not sure how it would work or if there is special status for common-law relationships. Sorry we can’t be more help on that. Nathan