TAX ADVICE IN SLOVAKIA

TAX ADVICE IN SLOVAKIA

Author

Prykhodko Andrii

Slovakia has a standard European tax system. Its basis is taxes on income and property of companies and individuals, as well as VAT and various duties and excises.

What are the taxes in Slovakia?

• Taxes on property (for example, on a car or real estate);
• income taxes (tax on the income of individuals and legal entities, tax on dividends);
• taxes on consumption (VAT, excise taxes on tobacco and alcohol);
• local taxes.

Income tax – the income tax for legal entities in Slovakia in 2022 is 21%, if the income is up to EUR 49,790, the tax will be 15%. Taxes for individuals from 19% to 25% are charged at a progressive rate depending on the size of the profit: profit up to 35,000 euros is taxed at the rate of 19%, profit over 38,000 euros – at the rate of 25%.

Taxes for a legal entity:

• – Income tax is 21%;
• Since 2014, a new tax has been introduced in the form of a tax license, which is paid by legal entities in different amounts depending on the annual turnover. This tax is paid once a year and reduces the total tax base;
• VAT – general rate of 20%, preferential rates of 10% and 0%;
• Capital gains tax: 21%;

Tax on dividends – the rate of this tax depends on many factors:

• A legal entity that is a resident of Slovakia pays dividends at a rate of 7% to resident individuals;
• The company also pays dividends at the rate of 7% to companies from other countries that have signed a double taxation avoidance agreement with Slovakia;
• In case of payment of dividends by a company from a country that has not signed an agreement on the avoidance of double taxation, the dividend rate is 35%;
• Dividends paid to a legal entity registered in Slovakia are not subject to tax. However, in this case, the company is forced to process the payment of income tax for its employees and to process it in the form of social and medical deductions.

VAT – the value added tax rate in Slovakia is 20%. This tax is mandatory for taxpayers whose annual turnover exceeds EUR 49,790. Or at a preferential rate – 10% (when importing goods into the EU, the tax is paid at customs.

Tax license

The tax license (introduced in 2014) sets the minimum amount of annual tax for an enterprise. It depends on the status of the VAT payer, as well as the annual turnover, in particular:

The company does not pay VAT, the annual turnover is less than EUR 500,000 – EUR 480 annually

Pays VAT, annual turnover is €500,000 – €960 annually

Annual turnover over EUR 500,000 – EUR 2,880 annually

Payment of the tax license by legal entities begins only from the 2nd financial year, the first year is not taken into account. Agreements that make it possible to avoid double taxation have been signed with about 60 countries, including Ukraine and Russia.

Optimization of taxes (taxation) in Slovakia

Tax optimization – bringing the tax burden to the optimal level from the point of view of its impact on the financial condition of the enterprise.

Savings due to the optimization of tax planning: the organization of the taxation system in Slovakia to achieve the maximum financial result with minimum costs both for the entire company as a whole for the maximum number of taxes and for individual types of taxes.

A tax lawyer (advocate) in Slovakia will advise you on choosing the optimal tax system for business in Slovakia regarding:

• CHOOSING THE OPTIMAL TAXATION SYSTEM FOR YOUR BUSINESS.
• TAX PLANNING CONSULTING.
• APPEAL OF TAX AUDIT RESULTS.
• ANALYSIS OF TAX RISKS FOR LEGAL ENTITIES AND INDIVIDUAL ENTREPRENEURS.
• REPRESENTATION OF YOUR INTERESTS IN FISCAL AUTHORITIES.
• SUPPORT OF AGREEMENTS WITH REGARD TO TAX ISSUES.
• LEGAL ASSISTANCE DURING TAX AUDITS.
• SUBMISSION OF TAX REPORT.

Representation in the tax authorities in Slovakia by Yuk Prykhodko and partners is consulting, preparation of all necessary documentation, relations with the tax authorities in Slovakia.