Dependent child tax credit

The taxpayer is entitled to a tax credit for a dependent child living in a jointly managed household in the amount of:

• CZK 15 204 per year per child,
• CZK 22 320 per year for the second child,
• CZK 27 840 per year for the third and each additional child.

If the child is entitled to a Disabled Persons’ Identity Card, the tax benefit is doubled.

A taxpayer’s dependent child is his/her own child, an adopted child, a child in care replacing the care of his/her parents, a child who has ceased to be in foster care with the taxpayer due to the acquisition of full legal capacity or the age of majority, the child of the other spouse, the taxpayer’s own grandchild or the grandchild of the other spouse, if his/her parents do not have sufficient income on which to claim the tax benefit, if

• a minor child,
• an adult child up to the age of 26 if he or she is not in receipt of an invalidity pension for third degree disability; and
• is continuously preparing for a future profession (studying),
• is unable to train systematically for a future occupation or to engage in gainful activity because of illness or accident, or
• is unable to engage in continuous gainful activity because of a long-term adverse health condition.

The tax credit for a dependent child can be used in 3 forms:

• In the form of a tax credit, when the tax calculated is higher than the tax credit claimed.
• In the form of a tax bonus, if the calculated tax is zero, then the entire tax benefit becomes a tax bonus.
• In the form of a rebate and a tax bonus at the same time where the calculated tax is less than the tax credit. Up to the amount of the tax, the tax benefit is a discount and the rest is a tax bonus.

If there are more than one taxpayer supporting a child in a joint household, only one of them can claim the tax credit in the tax year. The other taxpayer is required to provide a certificate from his or her employer stating which child the other taxpayer claims the tax credit for and in what amount.

The entitlement to the tax credit begins in the month in which the child is born or begins systematic training for a future profession or is adopted or taken into care.