Mortgage interest tax deduction (odpočet úroků)
Interest paid on a loan for your own housing can be deducted from the income tax base under § 15(3) of Act No. 586/1992 Coll. The limit is CZK 150,000 a year per household for loans taken out from 1 January 2021, and CZK 300,000 for older ones. The deduction covers mortgages and building savings loans, but not loans on a let property or non-purpose loans.
Example
A CZK 4,000,000 mortgage over 25 years at 5.00 % runs up about CZK 198,000 in interest in the first year. You can deduct at most CZK 150,000, which at a 15 % tax rate saves CZK 22,500. You never save more than the tax you would otherwise pay, though: the deduction is not paid out as a benefit.
In practice
Early each year the bank issues a certificate of the interest paid in the previous year. Employees hand it to their employer for the annual tax reconciliation; everyone else attaches it to their tax return. If two people in the same household are repaying, the CZK 150,000 limit is split between them. For a let flat, interest can be claimed only as an expense against rental income under § 9.
How it differs
The deduction reduces the tax base, not the tax itself: at a 15 % rate you save 15 % of the amount deducted. Tax credits, for example for a spouse or child, come straight off the calculated tax instead. The supporting document is the certificate of interest paid, and you claim the deduction in the annual tax reconciliation or in your tax return.
Related terms
In-depth guide
Calculate your own situation
Instead of abstract definitions — enter your own parameters and see the result for yourself. No registration, no form, no salespeople.