Daně a legislativa ČR
How to Legally Optimise Investment Taxes
Key takeaways
- Accumulating ETFs defer taxation until sale — reinvestment within the fund is not subject to tax.
- The 3-year holding-period test exempts gains from sales — patience pays off from a tax perspective.
- DIP and pension savings offer a tax base deduction of up to CZK 48,000 per year.
- Losses from securities sales can be applied against gains in the same category in the same year.
- The value test (up to CZK 100,000 in annual sales) is a straightforward route to zero tax liability.
Legal tax optimisation for investments means arranging decisions about purchases, product selection and timing of sales so that your tax liability is as low as possible — in compliance with current legislation.
Choosing accumulating ETFs over distributing ones
An accumulating ETF reinvests dividends within the fund. You receive no dividend income until you sell the fund — and therefore pay no tax. A distributing fund, by contrast, pays you dividends every year, taxed at 15% with no option to defer. More on the differences in the article accumulating vs. distributing ETFs.
Making use of the holding-period and value tests
There are two key tools:
- Holding-period test (3 years): gains from selling ETFs or shares are exempt after three years; from 2025 with an annual cap of CZK 40 million in proceeds
- Value test (CZK 100,000): if total proceeds from securities sales for the year do not exceed CZK 100,000, gains are exempt regardless of how long the investment was held
The value test is particularly useful for beginning investors or in years when you sell only minimally.
DIP and pension savings as a tax relief
Personal contributions to the Long-Term Investment Product (DIP) and pension savings can be deducted from the tax base. The combined annual cap for DIP, pension savings and life insurance is typically up to CZK 48,000. At the 15% rate, this represents a real annual tax saving of up to CZK 7,200. The funds are generally locked in until age 60 and for at least 10 years — early withdrawal means the deductions are clawed back.
Applying losses
If you sell a security at a loss in a given year, that loss can be offset against gains from other securities sales in the same year. This is known as tax-loss harvesting — a deliberate sale of loss-making positions near year-end to reduce the taxable base.
This article does not constitute tax advice. Rules may change — always verify the current conditions or consult a tax adviser. See also taxes on ETFs in the Czech Republic.
FAQ
What is the simplest legal tax optimisation for a retail investor?
Buy an accumulating ETF, hold it for more than 3 years and then sell. Dividend reinvestment within the fund is tax-free; the gain from the sale after 3 years is exempt under the holding-period test. Simple and entirely legal.
How much will I save through DIP?
A deduction of up to CZK 48,000 per year at a 15% tax rate means a real saving of up to CZK 7,200 annually. If you are in the second tax bracket (23%), the saving is even higher.
What is tax-loss harvesting?
The deliberate sale of loss-making positions near year-end so that the loss reduces the taxable gain from other securities sales. It only works within the same income category and in the same tax year.