Mortgage interest tax deduction in Czechia: how much and how to claim it

The mortgage interest tax deduction in Czechia lets you deduct interest paid on a mortgage for your own home from your income tax base: up to CZK 150,000 a year for loans taken out from 1 January 2021, and CZK 300,000 for older ones. At the 15 % tax rate that saves you up to CZK 22,500 (or CZK 45,000) a year.

With a CZK 4 million mortgage at the average rate of 5.00 % (ČBA, August 2026) you pay roughly CZK 198k in interest in the first year, so you use the whole limit and get CZK 22,500 back from the state, about CZK 1,875 for every monthly payment.

Employees usually claim the deduction (odpočet úroků) through their employer's annual tax reconciliation, handing in the bank's certificate by 15 February 2027; everyone else claims it on line 47 of their own tax return. Below are both procedures, the conditions the tax office checks and the cases where you are not entitled, above all a flat you let out.

Who is entitled

Under § 15(3) and (4) of the Income Taxes Act you are entitled only if all four conditions are met.

• You are a party to the loan agreement, as borrower or co-borrower; a guarantor is not entitled. The loan must be a mortgage, a building savings loan (stavební spoření, the state-supported Czech housing savings scheme) or a loan refinancing one of them. With a non-purpose “American” mortgage you must prove the money went on housing.
• The loan pays for a housing need as defined in § 4b: buying a flat or house, building, buying a plot on which construction starts within 4 years, renovation and maintenance, settling co-ownership or an inheritance for housing, or repaying an earlier housing loan.
• You own or co-own the property for the whole tax year. In the year you acquire it, owning it on 31 December is enough.
• The property is a permanent home for you, your spouse, children, parents or grandparents. Registered permanent residence (trvalý pobyt) is not required; what counts is where you actually live. A flat let to a stranger or a holiday cottage does not qualify.

For construction and renovation, the residence test applies after completion. You can deduct interest on a mortgage for building a house while it is still going up, provided you actually move in once it is finished.

How much mortgage interest can you deduct?

The limit applies to all loans in one household combined, not to each mortgage separately. It also follows the date the housing need was acquired, not the date of the latest contract: if you bought a flat with a mortgage in 2019 and refinanced in 2024, your limit stays at CZK 300,000.

If you pay interest for only part of the year (drawdown in September, final repayment in June), the limit drops to 1/12 for each month in which you pay interest. A CZK 4 million mortgage drawn in September 2026 has a limit of 4 × 12,500 = CZK 50,000 for 2026. Four months' interest at 5.00 % comes to roughly CZK 66k, so you deduct CZK 50,000 and save CZK 7,500.

The Nováks: CZK 4 million over 25 years

The table assumes the rate stays at 5.00 % throughout. In reality it changes at every refixation, and the interest with it. The bank's certificate always shows the interest actually paid in the calendar year, and that is the figure that goes into the return, not a calculator estimate.

How do you claim it: employer reconciliation or tax return?

Employees normally claim through their employer's annual tax reconciliation (roční zúčtování daně):

1. January 2027: the bank issues the certificate of interest paid (potvrzení o zaplacených úrocích) for 2026, in internet banking or by post. You do not have to ask for it.
2. By 15 February 2027: sign the request for annual reconciliation at your payroll office (it is part of the Taxpayer's Declaration form, Prohlášení poplatníka) and attach the certificate. In the first year, add a copy of the loan agreement and proof of ownership (a land registry extract), plus the building permit for construction or documents showing the purpose of the loan for renovation.
3. March 2027: the employer does the reconciliation and pays out the overpaid tax with your March salary at the latest.

An employee who has to file a tax return cannot use the reconciliation; typically that means two jobs in the same month, or rental or business income above the statutory limit. They claim the deduction on line 47 of the personal income tax return, in the section on non-taxable parts of the tax base, with the bank's certificate attached (and in the first year the loan agreement and proof of ownership). When filing electronically you upload the attachments as files.

The 2026 return is due by 1 April 2027 on paper, a month later if filed electronically, and by 1 July 2027 with a tax adviser. The tax office refunds the overpayment within 30 days of the filing deadline, provided you asked for the refund at the end of the form.

Self-employed people (OSVČ) in the flat-rate tax regime (paušální daň) cannot claim the deduction, because they file no return and the regime allows no deductions. If you pay around CZK 150k of mortgage interest a year, that alone is a reason to check whether the flat-rate tax still pays off. Self-employed people using flat-rate expenses (60 %, 40 %) can claim it, since those percentages concern only expenses, not the non-taxable parts of the tax base.

Spouses, partners and co-owners

The law offers two options: one party to the loan agreement claims all the interest, or each claims an equal share. Other splits (70/30) are not allowed. Pick whichever saves more:

• One spouse is on parental leave or has a low tax base: the other claims the whole deduction. The deduction reduces the tax base, so it is worthless to someone with no tax to pay.
• One spouse has part of their income taxed at 23 %: for them the deduction is worth 23 % rather than 15 %, so they should claim it.
• Both earn similar amounts: splitting it in half does no harm but gains nothing, and it is simpler to leave it all with one of you.
• Unmarried partners claim it the same way, provided both are parties to the loan agreement and both co-own the flat. A partner who is only a co-borrower with no share in the flat cannot claim.

The CZK 150,000 limit is shared by the household however many people claim it. How to set ownership shares when two people buy together is covered in our article Co-ownership and mortgages.

When you are not entitled, and common mistakes

• A flat you let out. Interest on a mortgage for a rented property is not a § 15 deduction but an expense against rental income under § 9, and only if you claim actual expenses rather than the 30 % flat rate. See our article on the buy-to-let mortgage.
• A holiday cottage (chata, chalupa), which is not a permanent home.
• A loan used only partly for housing (part of the mortgage went on a car or furniture): only the matching share of the interest is deductible.
• Interest someone else paid. Parents paying the mortgage of a child who is the sole borrower cannot claim it; the child can.
• A deduction forgotten in earlier years, which you can usually put right with a supplementary tax return up to three years back.
• Selling or letting the property. The deduction stops with the year in which the property ceases to be your home. Nothing is clawed back retroactively, unlike with a cancelled pension or life insurance policy.

The other taxes linked to a mortgage and property (annual property tax, the exemption on sale, VAT on new builds) are summarised in our article Mortgages and taxes.