This includes earnings from work done within the country, such as director's fees or income from a business operated through a permanent establishment (PE).
Revenue generated from capital gains falls within a special tax bracket, which is subject to taxation at a rate of 19%.
Individuals in Slovakia are entitled to personal allowances, which are calculated based on a multiple of the minimum subsistence amount declared on January 1st each year.
However, if an individual's taxable income exceeds this threshold, the personal allowance is gradually reduced to zero using a predetermined formula.
For the year 2023, the personal allowance stands at EUR 4,922.82, determined by the minimum subsistence amount in effect on January 1st, 2023.
The exact amount of this allowance is contingent upon the incomes of both the individual and their spouse for the year 2023, determined by a predefined formula.
Both personal and dependent spouse allowances can only reduce income derived from employment, business, or self-employment activities.
Additionally, the spouse allowance is only applicable if the spouse resides with the taxpayer in the same household and meets specific criteria, such as caring for a dependent child (annual child tax bonus is EUR 282.84 as of 2022[6]), receiving a nursing allowance, actively seeking employment with a labour office, or being classified as disabled.
Examples include scholarships provided from the state budget or by higher education institutions, as well as similar benefits from abroad.
Additionally, financial resources from grants issued based on international treaties, binding Slovakia, are exempt from taxation.
Benefits received from health and social insurance, including old-age savings, are also not subject to taxation.
Per diems and employer contributions to employee board expenses, up to amounts specified by law, fall under this exemption.
A company is considered a tax resident in Slovakia if it has its registered seat here, its effective place of management is Slovakia where key management decisions are made or accepted, or if it is not considered a tax resident in another contractual country according to the relevant DTT.
However, a reduced CIT rate of 15% is available for corporate taxpayers, entrepreneurs, and self-employed individuals whose taxable revenues does not exceed EUR 49,790 for the respective tax period.
Charitable contributions are treated as gifts and are not tax deductible, and certain expenses, such as entertainment costs and certain provisions, are specifically non-deductible.
Additionally, net operating losses can be carried forward and utilized over a specified period, and deductions may be claimed for payments to foreign affiliates, subject to certain limitations.
The reduced VAT rate applies to goods such as pharmaceutical health products, printed materials and media and important groceries like bread, milk, and meat, which are classified under selected codes of the Common Customs Tariff.
Since 2009, domestic businesses have to register for value added tax if their turnover for the past 12 months has reached 49,790 Euro.
There are cases where the obligation of value added taxes is passed to a domestic purchaser and in this form the registration of this business entity is avoided.
Considering long distance exchanges, the business must register for the value added tax in the case the value of goods supplied is more than 35,000 Euro per year.
Total consideration charged for the supply, excluding VAT but including any excise duties or other taxes and fees.
In Slovakia a company is treated as resident if it has its legal seat or place of effective management in the Slovak Republic.
The taxable income is computed on the basis of the accounting profits and is adjusted for several items as described in the tax law.
The filling deadline may be extended from three to six months if part of the taxpayer's tax base consists of foreign-source income.
Dividends paid out of profits generated starting on 1 January 2004 until 31 December 2016 are not subject to any Slovak tax.
Dividends paid out of profits which were generated from 1 January 2017 should be a subject to a 35% withholding tax, however, only if the recipients are foreign companies based in a non-cooperating state.
Property or real estate tax[16] is imposed on individuals or companies that are owners of a building, flat, land and non-residential spaces.
Persons travelling on a highway or speedway in Slovakia with a vehicle with a maximum permissible total weight below 3.5 tons are obliged to pay road tax by buying a vignette.
A company named SkyToll A.S. runs a system based on a combination of GPS, GSM and DSRC technology.
Each driver has to stop at one of the distribution points located on each border crossing used by heavy traffic and register the vehicle.