Flat Rental Tax 2026: Calculation, Expenses and Exemptions

This article explains the taxation of rental income from a flat under § 9 of the Income Tax Act for 2025 (return filed in 2026) and for 2026 (return filed in 2027). We last verified the information on 27. 10. 2026.

We write about property tax here.

In this article on the taxation of rental income, you will learn:

when you must (and when you do not have to) file a tax return,
how rental income tax is calculated,
which expenses, deductions and tax reliefs you can use,
when letting becomes a business activity and when you are required to pay VAT.

Published 30/1/26, 10:12 am

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Tax on rental income from a flat for 2025

Are you letting a flat or other property and need to file a tax return in 2026? It is important to understand how to tax your 2025 rental income correctly, which expenses you can claim and what to watch out for so that you do not pay more than necessary.

The tax return is filed for the period from 1 January to 31 December 2025. The submission deadlines in 2026 are:

1 April 2026 – in standard paper form.
4 May 2026 – electronic submission.
1 July 2026 – when filed through a tax adviser.

You can easily complete your income tax return for rental income via the Online Tax Office on the MOJE daně portal. Its intuitive guide will help you complete all the required information and alert you to potential errors. Report property rental income in Appendix No. 2. You can submit the completed tax return electronically directly from the portal or via a data box, or print it as a PDF and submit it in paper form.

Who must tax rental income?

The answer depends on what other income you have and on your individual circumstances.

Employee or self-employed person

If you are an employee and your non-employment income for 2025 did not exceed CZK 20,000, you do not have to file a tax return. However, most landlords exceed this threshold and must therefore file a tax return.

Person with no taxable income

Do you have no employment or business income? If your total taxable income does not exceed CZK 50,000, you do not have to file a tax return.

Pensioner

A pensioner with rental income exceeding CZK 50,000 per year must file a tax return. However, they will often pay no tax because they can claim the full taxpayer allowance of CZK 30,840 in their return. See the section on 2026 above for the calculation.

Spouses or multiple co-owners

If a flat is part of the joint property of spouses, the rental income is taxed by only one of them (§ 9 odst. 2). In the case of fractional co-ownership, each co-owner taxes income and expenses according to their share. If they divide them differently, they may claim only evidenced expenses, not the flat-rate allowance (§ 12 odst. 2).

Tax on rental income for 2026: thresholds, deadlines and when no tax is payable

The rules for rental income under § 9 of the Income Tax Act remain unchanged for 2026. Expenses may be claimed at their actual amount or as a flat-rate 30% of income, up to a maximum of CZK 600,000, and the selected method cannot subsequently be changed (§ 9 odst. 4). The threshold for the higher tax rate is changing because it is based on the average wage.

Parameters for rental income by year
Tax period	Threshold for the 23% rate	Taxpayer allowance
2024	CZK 1,582,812	CZK 30,840
2025	CZK 1,676,052	CZK 30,840
2026	CZK 1,762,812	CZK 30,840

The threshold is 36 times the average wage. For 2026, the average wage is CZK 48,967 under Government Regulation No. 365/2025 Sb. The 23% rate applies only to the portion of the total tax base above the threshold, not to the entire tax base or the rental income itself.

Tax return deadlines for 2026

by 1. 4. 2027 in paper form,
by 3. 5. 2027 for electronic submission (1. 5. 2027 falls on a Saturday),
by 1. 7. 2027 if the return is filed by a tax adviser or lawyer under a power of attorney registered with the tax office by 1. 4. 2027.

Tax is payable on the final day of the deadline for filing the return.

When rental income tax is not payable

The law does not provide a specific exemption for income from letting a flat. Nevertheless, the tax due will be zero if it is covered by the CZK 30,840 taxpayer allowance that you have not used elsewhere. This typically applies to pensioners with an exempt pension or to people with no other taxable income. With the 30% flat-rate allowance, this applies to annual rental income of approximately CZK 293,800, or around CZK 24,480 per month. Employees generally claim the allowance through their employer, so this calculation does not apply to them.

Not paying tax does not mean that you do not have to file a tax return. Anyone whose taxable income for the year exceeds CZK 50,000 must file a return (§ 38g odst. 1). An employee who has signed a declaration with their employer does not have to file a return only if their other income, including rental income, does not exceed CZK 20,000 per year (§ 38g odst. 2).

Tax on rental income for pensioners

A regularly paid pension is exempt from tax up to 36 times the minimum wage applicable on 1 January of the relevant year (§ 4 odst. 1 písm. g). An exempt pension is not included in the CZK 50,000 threshold for the obligation to file a tax return. A pensioner with annual rental income above CZK 50,000 must therefore file a return, but can claim the full taxpayer allowance in it, so rental income tax will often be zero.

Spouses and co-owners

Income from a flat forming part of the joint property of spouses is taxed by only one spouse (§ 9 odst. 2). In the case of fractional co-ownership, each co-owner taxes income and expenses according to their share. If they divide them differently, they may claim only evidenced expenses, not the flat-rate allowance (§ 12 odst. 2).

Calculation example for 2026

An employee with an annual gross salary of CZK 600,000 lets a flat for CZK 20,000 per month, i.e. CZK 240,000 per year. Using the 30% flat-rate allowance, they deduct CZK 72,000, resulting in a partial tax base from the rental of CZK 168,000. The total tax base of CZK 768,000 is below the CZK 1,762,812 threshold, so the tax on the rental income is 15% of CZK 168,000, i.e. CZK 25,200. They have already claimed the taxpayer allowance through their employer and therefore cannot deduct it again.

We verified the parameters on 27. 10. 2026 in Act No. 586/1992 Sb., as effective from 1. 8. 2026, in Government Regulation No. 365/2025 Sb. and in the Financial Administration guide for landlords. For your own figures, use the 2026 rental income tax calculator.

How do you tax rental income?

Calculating tax on rental income is quite straightforward:

Add up all rental income
Deduct expenses (flat-rate or actual)
This gives you the tax base
You can reduce this by deductible items
Reduce the calculated tax by tax allowances

Taxation of rental income

What counts as rental income and what does not? Rental income includes rent actually received during the relevant tax period, i.e. from 1.1.2025 to 31.12.2025.

Are utility advances included in rental income?

Yes and no. Advances for energy and utilities are not included in rental income if they are subsequently included in the tenant's annual statement of utilities. It is advisable for the amount of advances to be specified in the lease agreement. If advances are set as a flat amount and no annual statement is provided, they constitute taxable income in the same way as rent.

Is the security deposit included in rental income?

The security deposit is not included in rental income as long as you return it at the end of the tenancy. If you use it to offset unpaid rent, that amount is rental income.

Rent received in December for January: how is it taxed?

Did you receive January's rent in December and wonder whether to include it in your income for 2025? Yes. What matters is when you received the rent, not the period for which it was intended.

What if the tenant did not pay rent? Do I have to tax it?

What matters is not whether you received the rent regularly, but whether you actually received it. If the tenant did not pay, you do not pay tax on the unpaid rent. However, it is advisable to retain supporting documents, such as payment reminders for the unpaid amount.

The difference between flat-rate rental expenses and actual expenses

To calculate the tax base on rental income, deduct your rental-related expenses from your total rental income for the year. These expenses can be calculated in two ways: either by adding up your actual expenses or by using the flat-rate allowance.

Flat-rate expenses

Flat-rate expenses amount to 30% of income and can be claimed up to a maximum of CZK 600,000. We recommend this calculation method to those whose rental operating costs are lower than the stated 30%. When claiming flat-rate expenses, you must keep records of income, and transport expenses and payments to the repair fund cannot be included.

Actual expenses

When claiming actual expenses, you must keep chronological records of income and expenses, records of tangible assets that you depreciate, and records of receivables (§ 9 odst. 6). You do not have to keep accounts.

What are actual expenses?

Real estate agency fees
Mortgage interest
Property insurance
Property repair and maintenance costs
Flat furnishing costs

You must be able to substantiate your expenses throughout the entire tax assessment period. This generally ends three years after the deadline for filing the tax return and may be extended in certain circumstances.

Tax rate on property rental income

Two tax bands apply to all taxable income (including rental income)

15 %,
23 %.

The 15% rate applies to the part of the total tax base up to 36 times the average wage, while the 23% rate applies to the part above this threshold. The threshold is CZK 1,676,052 for 2025 and CZK 1,762,812 for 2026. The aggregate of all partial tax bases is assessed, such as gross salary and rental profit, rather than rental income alone.

How to reduce the tax base on rental income

The tax base for rental income can be reduced by so-called deductible items. These are non-taxable parts of the tax base. You can then further reduce the resulting tax by applying tax reliefs.

What are deductible items?

Gifts
Interest on loans used to finance housing needs (building savings, mortgage)
Pension insurance
Supplementary pension savings
Private life insurance premiums
Membership fees paid to a trade union
Payments for examinations verifying further education outcomes

Tax relief

You can further reduce tax on property rental income by applying tax reliefs.
Taxpayer relief – CZK 30,840
Spouse relief
Relief for partial or full disability pension
Child relief – CZK 15,204 for the first child, CZK 22,320 for the second child, CZK 27,840 for the third and each additional child)

Please note: student relief and nursery fee relief can no longer be claimed (the last time was for 2024)

Business activity or rental?

If you let your property on a short-term basis, for example to tourists, this is not considered rental but the provision of accommodation services. In this case, you must hold a trade licence and tax the income as income from self-employment. You can claim a 60% flat-rate expense allowance against business income. If you want to let to tourists while retaining rental status, you can use our service.

VAT payment when renting out a flat

The letting of immovable property is exempt from VAT, with a few exceptions.

When do you have to pay VAT?

Operating a short-term rental
Providing accommodation services and letting premises and spaces for vehicle parking
In these cases, the VAT payer is obliged to charge VAT on the rent, but is entitled to deduct VAT. Under the VAT Act, the letting of property may constitute a taxable supply. However, the condition is that the property must be let by one VAT payer to another VAT payer and must be defined as non-residential premises.

Calculating tax on rental income

For the calculation, you need to know two amounts. One is your rental income. The other is your rental-related expenses. Then deduct the expenses from the income to obtain the tax base needed to calculate the tax.

Example: Your rental income last year was CZK 240,000. As your rental-related expenses did not exceed the 30% threshold (i.e. CZK 72,000), you claim the 30% flat-rate expense allowance.

240 000 - 72 000 = 168 000 Kč.

In this case, the tax base is CZK 168,000. If your income falls within the first tax band (15% rate), the tax on renting out the flat will be CZK 25,200.

You can also reduce the tax base by so-called deductible items. The resulting tax can additionally be reduced by tax reliefs.

Finding it confusing? Use our rental tax calculator and work it out in no time!

Conclusion

Tax on rental income need not be complicated when you know how to approach it. You can easily complete your tax return in the tax authority’s online application. The key is choosing the right method for claiming expenses – actual or flat-rate. You then only need to consider which deductible items you can claim and which tax reliefs you are entitled to.

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From the rules to calculating rental tax

To compare flat-rate and actual expenses, continue to the 2026 rental tax calculator page. You will also find a model example and an explanation of why the partial tax base from rental income is not the same as the final tax on all income. When choosing expenses, rely on substantiating documents, not merely on the lower amount in the example.