SlovakiaTax Obligations Detailed

In Slovakia, employers face various tax obligations related to payroll, corporate income tax, and other levies.

Employer Payroll Tax Obligations

• Income Tax Withholding: Employers withhold income tax from employee salaries. The tax rate is 19% for income up to €38,553.01 and 25% for income exceeding this threshold (2022 rates, check for 2025 updates). Withholding occurs monthly, and payment is due to the tax authority within five days of payday. A monthly payroll tax return is due by the end of the following month. Additionally, an annual report is due by the end of April for the previous year.
• Social Security Contributions: Employers contribute to social security, which includes pension, health, and unemployment insurance. The total employer social security contribution is generally around 35.2%. Specific rates for each component should be confirmed with official sources for 2025.
• Health Insurance: Employers register with the employee's chosen health insurance company and contribute to health insurance. The employee portion is typically deducted from their salary.

Corporate Income Tax (CIT)

• CIT Rate and Thresholds: As of 2025, several key changes impact CIT. The general CIT rate is 21%. However, for businesses with taxable income up to €100,000, a reduced rate of 10% applies. For income above €5,000,000, the rate increases to 24%.
• Dividend Withholding Tax: For dividends paid from profits generated in 2025 onwards, the withholding tax rate is 7% for individuals.
• Tax Return Due Date: CIT returns are due within three months of the fiscal year-end, typically March 31st. Extensions of up to six months may be possible.
• Advance Payments: CIT advance payments are usually made monthly or quarterly. Final payments are due within five days of the reporting deadlines for each quarter, half-year, nine months, and the full tax year.
• Depreciation Method Changes (2025): New rules require adjustments to asset depreciation for periods before 2025, aligning with new depreciation methods without retroactive recalculations of past depreciation.

Other Tax Obligations

• VAT (Value Added Tax): Slovakia has a standard VAT rate of 20%. Reduced rates apply to specific goods and services.
• Real Property Tax: Levied by municipalities on property owners.
• Special Levy: Applies to businesses in regulated sectors.
• Registration Requirements: Businesses must register with the Financial Administration of the Slovak Republic within 30 days of incorporation or establishment. Registration with the Social Insurance Agency is also required before an employee's start date.

Important Dates and Deadlines (2025)

• January 31st: Deadline for various annual filings, including the employer's annual tax reconciliation for employees upon request.
• March 31st: General deadline for filing the annual CIT return.
• April 30th: Deadline for submitting the annual payroll report for the previous year.

This information provides a general overview. Specific details and updated figures for 2025 should be confirmed with official Slovak tax authorities or a qualified tax advisor. Tax laws and regulations can be complex and subject to change, so professional advice is essential for accurate compliance.

In Slovakia, employee tax deductions primarily involve mandatory health and social insurance contributions, with some personal allowances and tax credits available under specific conditions.

Health and Social Insurance Contributions

• Health Insurance: Employees contribute 4% of their gross income towards health insurance. The employer also contributes 10%.
• Social Insurance: Employees contribute 13.4% of their gross income towards social security, covering areas like pensions, sickness, and unemployment. The employer makes an additional contribution of 25.2%. These contributions are capped at a maximum assessment base, which is adjusted annually. In 2025, this limit is €15,730.

Personal Allowances

• Basic Personal Allowance: A basic personal allowance is available, reducing the taxable income. For 2024, this allowance was €5,646.48, decreasing progressively for incomes above €24,952.06 and completely phasing out at €47,537.98. The amount is linked to the minimum subsistence level and is updated yearly; the 2025 figure will be determined based on the January 1st, 2025, value.
• Spouse Allowance: A dependent spouse allowance may be claimable by Slovak tax residents if the spouse's income is below a specified limit. The allowance is dependent on both the individual's and the spouse's income. Similar to the personal allowance, specific figures for 2025 will depend on the minimum subsistence amount announced at the start of the year.

Tax Credits and Bonuses

• Child Tax Bonus: For 2025, the bonus is €100 monthly for children under 15 and €50 monthly for children aged 15-18. This bonus is generally available to Slovak tax residents whose income is derived primarily from Slovak sources, with certain income limitations. Eligibility rules apply.
• 2% Tax Donation to Parents: Starting 2025, employees can donate 2% of their paid income tax to one or both parents if the parent(s) meet specific criteria, including being of retirement age and receiving a pension.
• Non-Cash Benefits: Some non-cash benefits provided by the employer, up to €500 annually, are tax-exempt for the employee.

Tax Rates and Deadlines

• Tax Rates: The general income tax rates for 2025 are 19% for income up to €48,441.43 and 25% for income above this threshold.
• Tax Year: The tax year in Slovakia is the calendar year (January 1st to December 31st).
• Tax Filing: Employers withhold income tax monthly and remit it to the tax authority within five days of the employee's payday. An annual tax settlement and reconciliation process usually take place in the following year.

This information is current as of February 5, 2025, and might be subject to change. Consulting with a tax advisor or referring to the official Slovak tax authority resources is recommended for the most accurate and up-to-date details.

In Slovakia, Value Added Tax (VAT) is a general, indirect tax levied on most goods and services at a standard rate of 23%, a reduced rate of 19%, and a super-reduced rate of 5% as of January 1, 2025.

VAT Rates

• Standard Rate: 23% (increased from 20% in 2024). This rate applies to most goods and services not specifically listed under the reduced or super-reduced rates. Catering services now fall under this standard rate as of 2025.
• Reduced Rate: 19% (increased from 10% in 2024). This rate applies to specific goods and services, including certain food items, household electricity, and non-alcoholic beverages served in restaurants.
• Super-Reduced Rate: 5%. This rate applies to essential goods and services such as certain food items (e.g., bread, milk, fruits, vegetables, meat), medicines, children's products, and selected books.

VAT Registration

• Threshold: The mandatory VAT registration threshold for businesses established in Slovakia is €75,000 as of January 1, 2025. Non-resident businesses may be required to register from their first taxable supply, regardless of turnover. Voluntary registration is also possible.
• Distance selling of goods to consumers in Slovakia has a threshold of €35,000.
• Process: Businesses register with the Tax Office Bratislava.

VAT Filing and Payment

• Frequency: Monthly returns are standard, though businesses with annual turnover under €100,000 in the previous calendar year may opt for quarterly VAT returns after the initial 12 months of monthly VAT returns.
• Deadline: VAT returns and payments are due by the 25th day of the month following the reporting period.
• Method: Returns must be submitted electronically.

VAT Exemptions

• Exempt with Input VAT Deduction: Includes intra-Community supplies of goods to another EU Member State and international passenger transport services.
• Exempt without Input VAT Deduction: Includes financial and insurance services, the supply and rental of immovable property (with some exceptions), along with education, healthcare, and welfare services.

Intrastat Declarations

Intrastat declarations are obligatory for businesses transporting goods over EU borders if their annual trade volume surpasses specified thresholds.

Other Considerations

• Slovakia permits the formation of VAT groups under specific conditions.
• Foreign businesses can recover VAT, although reciprocity might be required for non-EU businesses.
• A tax representative is typically not mandatory for non-resident businesses.
• Penalties exist for late filing, late payment, or failure to register for VAT. Specific penalties vary depending on the severity of the infringement. Interest is also charged on unpaid VAT.

This information is current as of February 5, 2025, and might be subject to change. It's recommended to consult with a tax advisor for the most up-to-date regulations and specific guidance relevant to your situation.

Slovakia offers various tax incentives for businesses and individuals. As of February 5, 2025, these incentives aim to stimulate economic growth, encourage investment, and support specific sectors such as research and development. Please note that tax laws are subject to change, so it's essential to verify current regulations.

Corporate Tax Incentives

• Investment Incentives: Slovakia provides corporate income tax relief for investments in specific areas, including industry, technology centers, shared services centers, and tourism. These incentives often take the form of tax credits, deductions on real estate, or financial support for job creation. Eligibility depends on factors like investment amount and project location. Approval from Slovak authorities is required, and if granted, relief can be applied for ten years following the grant. An additional deduction for investments with higher added value (Industry 4.0) may also be available.

• Research & Development (R&D) Incentives: Companies engaged in R&D can benefit from a super-deduction, allowing them to deduct 125% of qualified R&D costs. An additional deduction of 150% is possible if current qualifying R&D expenditures surpass those of the previous year. Unused deductions can be carried forward for up to four years but cannot be combined with other incentives. A special scheme provides a 50% exemption on income derived from commercial use of self-developed intangible assets.

• Tax Relief for Technological Centers: Tax credits ranging from 25% to 35% of qualified costs (capital investment or two-year labor costs) are offered to businesses establishing or expanding in less-developed regions. The credit amount depends on the specific region and is applied against annual income tax liabilities until fully utilized or expired (10 years). A cash grant alternative may also be available.

Individual Tax Incentives

• Tax Bonus for Dependent Children: A monthly tax bonus is available for dependent children. The bonus is €100 for children under 15 and €50 for children aged 15-18. Eligibility criteria include having taxable income from employment or entrepreneurship, Slovak tax residency (or for non-residents, earning at least 90% of worldwide income from Slovak sources).

• Personal Allowances: Allowances are available for the taxpayer, spouse, children, and dependents meeting specific requirements. An allowance of up to €1,200 per year is available for mortgage interest payments under certain conditions. An additional allowance of up to €1,800 applies to existing mortgage loans, subject to conditions. Foreign tax relief is also available through tax credits for foreign tax paid. A personal allowance, currently €5,646.48 for 2024, is also available for income up to a specific limit, and then reduces progressively based on a formula.

Other Tax Considerations

• Minimum Income Tax: Businesses are now subject to a new minimum income tax calculated based on turnover. This minimum tax can be treated as an advance payment for the next three years.

• Tax/Accounting Depreciation: Accounting depreciation is based on the expected lifetime of tangible fixed assets or the anticipated use of intangible assets.

It's advisable to consult with a tax professional or relevant Slovak authorities for the most current and comprehensive information on these incentives, eligibility criteria, and application procedures.