Slovakian Income Tax

Tax residents of Slovakia are taxed on their worldwide income. Non-residents are taxed on their Slovak source income only. An individual is deemed to be tax resident if he/she has a permanent home or habitual abode, or. if he/she stays at least 183 days in a calendar year in Slovakia. Most types of income – employment income, business and rental income, capital income etc. – and benefits in kind are taxable. The following benefits in kind are exempt from taxable income: training courses for employees; catering provided by the employer; recreation, health and education facilities, libraries, training and sport facilities.

Certain types of income, such as benefits from social insurance, unemployment or health insurance and grants from the State, foundations or from abroad, are exempt from taxable income. Taxpayers may deduct contributions to a supplementary pension insurance and to savings schemes subject to certain restrictions from their taxable income up to a maximum total of SKK 12’000 per year. They can also deduct a basic allowance of SKK 95’616 (which is 19.2 times the living minimum) if the aggregate income does not exceed SKK 498’000. If the aggregate income is higher than SKK 498’000, the basic allowance is SKK 220’116 (44.2 times the living minimum) less one fourth of the aggregate income. If the result is 0 or less, the basic personal allowance cannot be claimed. There is also a deduction for a dependent spouse. If the taxpayer’s income is up to SKK 880’464 and the spouse is not earning any income, the deduction is SKK 95’616. If the spouse earns up to SKK 95’616, the allowance is reduced by the spouse’s income. If the result is 0 or less, no allowance can be claimed. If the taxpayer’s income is higher than SKK 880’464, the deduction for a dependent spouse is SKK 315’732 less one fourth of the taxpayer’s income if the spouse has no income. If the spouse earns income, the allowance is reduced by one fourth of the taxpayer’s income and the income earned by the spouse. If the result is 0 or less, no allowance is applicable. Finally, a tax credit of SKK 6’480 per year per dependent child living in the same household is applicable if the taxable income exceeds SKK 45’600 (six times the minimum salary).

With effect from 1 January 2004 Slovakia has introduced a flat income tax rate of 19%. A tax return, based on self-assessment, has to be made by 31 March in the year following the tax year.