Property tax – land: How to calculate and when you do not have to pay?

In this article we explain who pays land tax, how it is calculated, when and how to declare and pay it. You will also find out which land is exempt and what happens if you forget to file your return.

Who pays land tax

Property tax is divided into two main parts – tax on buildings and units and tax on land. In what follows, we will focus on land tax, which is the tax that the state levies on the ownership of land registered in the Land Registry.

The land tax is payable by the person who is registered as the owner of the land in the land register on 1 January of the calendar year in question. If the land has more than one owner (e.g. spouses or siblings in joint ownership), each of them is liable for the tax in the amount corresponding to his/her joint ownership share.

Which land is not subject to tax

Some land is automatically exempt from land tax under the law, others only under certain conditions or by municipal ordinance.

Automatically exempted land

• land owned by the state or a municipality (within its territory), unless it is used for business, lease or leasehold purposes,
• public roads, burial grounds, dams, watercourses, sewers, and other land developed with public infrastructure,
• parts of protected nature,
• public open spaces and roads for general use.

Exemption subject to certain conditions

• land associated with cultural monuments, churches, schools, hospitals, libraries, social service facilities or ecological operations,
• agricultural and forest land after reclamation (for a period of 5 or 25 years),
• land used for contamination remediation or public research and education (e.g. universities),

Exemption by municipal ordinance

The law allows municipalities to decide for themselves which other types of land within their territory will be fully or partially exempt from land tax. In order to do so, the municipality must issue a generally binding ordinance specifying which land is exempt.

The exemption may apply to:

• Agricultural land – e.g. fields, meadows, pastures, etc. The condition is that the land is not in a built-up area or a developable area (i.e. it is not, for example, land intended for future construction). If the municipality provides for an exception, it must explicitly mark these plots.
• Other areas with the following uses: meadows and hillsides, barren land, waterlogged areas, green areas and other areas.

Real estate tax return

The real estate tax return (including land) is filed by 31 January of the calendar year in which the tax liability arose. The status as at 1 January of that year is therefore decisive.

When are you obliged to file a return

You must file a tax return if:

• You have acquired land – whether by purchase, inheritance or gift.
• There has been a change – e.g. the area, use or purpose of the land has changed.
• You have become a co-owner – one of the co-owners can file a return for all of them, or each for their share.
• You have sold part of the land but kept another part.

If you have filed a return for the land in the past and there has been no change, you do not need to file a new return – just pay the tax.

You can find a tax return form on the Revenue’s website or pick one up at any local Revenue office. You can file your tax return either electronically or in paper form.

Base, rate and coefficients of property tax (on land)

The amount of land tax depends on three main factors:

1. The type of land (e.g. arable land, garden, forest, building land, etc.),
2. Area in m²,
3. The local coefficient set by the municipality.

The tax base

The tax base depends on the type of land:

• For arable land, hops, vineyards, gardens and orchards, the tax base is determined by multiplying the area of the land by the average price per 1 m² set out in the Ministry of Finance Decree.
• For permanent grassland, farm forests and fish ponds, the tax base is the area of the land multiplied by CZK 3.80 per m².
• For other land, the tax base is the actual area in m².

Tax rate

The tax rate applied to the tax base varies according to the type of land:

• 1.35 % of the price for arable land, hops, vineyards, gardens and orchards,
• 0,45 % of the price for permanent grassland, forests and fish ponds,
• 3.50 CZK/m² for building land,
• 9 CZK/m² for paved areas for industry, transport and other businesses,
• 1.80 CZK/m² for paved areas for agriculture and forestry/water management,
• 0.35 CZK/m² for built-up areas and courtyards,
• 0.08-0.35 CZK/m² for other areas – depending on the type of use.

Local coefficient

The resulting tax is multiplied by a local coefficient determined by the municipality. The municipality can set a coefficient between 0.5 and 5 (higher coefficient = higher tax). If the municipality does not set its own coefficient, the statutory coefficient is applied according to the population:

• 1.0 in municipalities with up to 1 000 inhabitants,
• 1,4 in municipalities with up to 6 000 inhabitants,
• 1.6 in municipalities with up to 10 000 inhabitants,
• 2,0 for municipalities with up to 25 000 inhabitants,
• 2,5 up to 50 000 inhabitants,
• 3.5 in larger towns and spa towns,
• 4.5 in Prague.

For example, Prague applies the coefficient by decree in some areas. Flats and apartment buildings are thus multiplied by a coefficient of 5.

Calculation of land tax

Let’s say you own a 600 m² building plot located in a municipality with 12 000 inhabitants. The municipality has not issued its own general binding ordinance on the local coefficient and therefore the statutory coefficient based on the population is used to calculate the tax. In this case, the coefficient is 2,0. There is no building on the land yet, so it is a taxable building plot:

1. Thetax base: building land is not valued – the tax base is directly the area of the land: 600 m².
2. Tax rate: according to the law, the tax rate for building land is: CZK 3.50 per 1 m²→ 600 m² × CZK 3.50 = CZK 2,100.
3. The legal coefficient: the municipality has 12 000 inhabitants → the coefficient is 2.0.

The resulting tax: CZK 2 100 × 2.0 = CZK 4 200.

The annual tax on this building plot is CZK 4 200.

In the following years, the inflation coefficient introduced last year will still have to be taken into account. However, for 2025 it is set at 1.0 and therefore does not affect the calculation in practice.

How to pay property tax

Property tax, including land tax, must be paid by 31 May each year. If the amount of the tax exceeds CZK 5,000, it can be divided into two instalments – the first by 31 May and the second by 30 November.

You can pay the property tax by bank transfer as indicated by the tax office, in cash at the office or by bank transfer. Another option is to pay via SIPO, but you must arrange this in advance. The tax can also be paid from the overpayment of another tax – automatically or at your request.

What if I don’t file a tax return?

If you do not file your land tax return on time (after 31 January), you are liable to a penalty of 0.05% of the tax for each day of delay, up to a maximum of 5% and a maximum of CZK 300,000. Returns filed within 5 working days after the deadline are without penalty. If you understate the tax in your return and the authorities find the error, they will charge you the amount plus a penalty of 20% of the difference.

If you don’t pay the tax by 31 May, interest will accrue from the 4th day of delay (currently around 11.5% per year).

Summary

Land tax is payable by the person registered as owner in the Land Registry on 1 January of the year. The return is due by 31 January in the year in which the liability arises – for example, on purchase, inheritance, change of acreage or change of use of the land.

Exempt from tax are, for example, state land, municipal land (not used commercially), public open spaces or protected areas. Other types may be exempted by municipal ordinance, such as agricultural land outside the built-up area.

The amount of tax depends on the type and size of the land and the local coefficient. The tax is payable by 31 May. If the amount exceeds CZK 5 000, payment can be spread over two instalments. There are penalties for late returns and unpaid tax – fines, penalties and interest on late payment.