TBA & Associates

Tax Benefits and Incentives

Encouragingly, crypto licensees can access existing tax benefits and incentives.

Eligible Czech crypto companies, for instance, may benefit from the R&D tax credit, allowing for the deduction of up to 100% of relevant R&D expenditures from the tax base as a tax credit. This means that expenses are deducted twice – as regular tax-free expenses and as a tax credit for R&D. Additionally, if current-year qualifying expenses exceed those of the previous year, a further 10% may be applied as a supplement.

Cryptocurrency in Czech Republic


The Czech Republic stands out as an appealing destination within the EU for cryptocurrency enterprises due to its unique regulatory landscape. Exclusive oversight of the financial market, including cryptocurrencies, is conducted solely by the Czech National Bank.

TBA & Associates offers expert assistance in remotely acquiring a crypto license in the Czech Republic from the ground up, ensuring a comprehensive turnkey solution. Alternatively, they provide the option of a pre-established company with an acquired Czech crypto license, achievable in less than a fortnight.

While the Czech Republic currently lacks a dedicated cryptocurrency licensing framework, engaging in activities related to cryptocurrencies is treated as a licensed trade. This necessitates the registration of the company in the Trade Licensing Register administered by the Czech Ministry of Industry and Trade.

Despite the absence of specific requirements for incorporating crypto-related entities in Czech legal statutes, the establishment of a Czech crypto company typically spans one to three weeks. This timeline encompasses various stages, such as incorporation and the acquisition of a crypto license through the Trade Licensing Register.

In contrast to the conventional licensing procedures mandated by the Czech National Bank for financial institutions, there is no established licensing process for crypto-related activities. However, entities engaged in such activities are deemed obligated entities and fall under the oversight of the Financial Analytical Office (FAÚ), acting as the financial intelligence unit, ensuring compliance with the Czech AML Act.

Czech crypto companies bear routine obligations, including the implementation of Anti-Money Laundering/Know Your Customer (AML/KYC) policies, adherence to specific reporting requirements, and the appointment of an employee (AML Officer) responsible for ensuring compliance with regulatory requirements.

Czech Republic
Cryptocurrency Benefits

  • Entry into European markets
  • Swift processing, typically completed in 3 to 4 weeks
  • Straightforward structure allowing the founder to serve as a general manager
  • No need to hire local staff or obligation to appoint a local Money Laundering Reporting Officer (MLRO), thus providing you the freedom to devise an operating model that aligns seamlessly with the specific needs of your crypto project.
  • Primary justifications for acquiring a pre-existing cryptocurrency company in the Czech Republic:
  • Having minimal requirements for the initial share capital, starting from 1 CZK or approximately 0.04 EUR, provides the flexibility to launch your project without the need to secure substantial funding.
  • The absence of annual supervision fees eliminates the financial burden, allowing you to allocate your funds directly to the growth of your business.
  • With no obligations to register a physical office in the Czech Republic.
  • Companies meeting at least two of the following criteria (turnover less than 80 million CZK, total assets not exceeding 40 million CZK, and an average of fewer than 50 permanent employees) qualify for audit exemption.
  • Crypto companies can take advantage of general tax allowances, such as the R&D tax allowance, enabling the deduction of up to 100% of qualifying R&D expenses from the tax base during the tax year.- Remote processing

Categorized activities

  • Trading cryptocurrency for a traditional currency (crypto-to-fiat exchange)
  • Trading traditional currency for cryptocurrency (fiat-to-crypto exchange)
  • Swapping one cryptocurrency for another (crypto-to-crypto exchange)
  • Offering a service for safeguarding cryptocurrency through a wallet (custodial crypto wallet service)
  • Services for storing client cryptocurrencies (crypto storage service)
  • Facilitating the transfer of cryptocurrencies (crypto transfer service)
  • Comprehensive platform for various cryptocurrency transactions (full-fledged cryptocurrency exchange)

Czech Republic
Types of Cryptocurrency Licenses

At present, the majority of crypto firms intending to engage in economic activities in the Czech Republic must secure one of the standard trade licenses obtainable from the Trade Licensing Register. These licenses authorize operations within the EU, permitting the establishment of offices in any member country without encountering extensive bureaucratic processes, provided local authorities are duly notified in compliance with regional regulations.

Depending on the intended use of cryptocurrency, companies can apply for one of the following licenses:

– The Classic – Facilitating Cryptocurrency Transactions for a Fee
– Fiat – Commission-based exchange between cryptocurrencies and fiat money
– Traditional – Intermediation of currency exchange in various forms
– Specialized – Provision of specific products and services related to cryptography (e.g., crypto-wallets, encrypted client keys)

Failure to obtain the appropriate license exposes the crypto company to the risk of being labeled as fraudulent, facing fines of up to 500,000 CZK (approximately 20,204 EUR), and potential forced closure.

Starting a Cryptocurrency Company in Czech Republic

To secure one of the four licenses, a crypto company must undergo registration in the Czech Republic. The Limited Liability Company (SRO) stands out as a popular legal structure due to advantages such as low minimum equity requirements, a minimal number of founders, and the potential for exemption from financial audits. Registration can be completed within three weeks, provided all necessary documentation is promptly submitted.

Key requirements

  • A business plan outlining the intricacies and business model for continuity, along with financial statement details
  • A registered physical office in the Czech Republic
  • Development of a domestic anti-money laundering/counter-financing of terrorism policy for fraud detection and reporting
  • Appointment of an anti-money laundering officer trained in alignment with the company’s operating model and reporting obligations
  • Description of hardware and software employed in the proposed economic activity
  • Development of data protection procedures compliant with GDPR and other relevant legislation, facilitating data exchange with authorities
  • Formulation of policies and procedures ensuring the security of client funds

The primary steps for opening an SRO (Limited Liability Company) for crypto operations include:

  • Verification of the new company’s name
  • Obtaining a criminal record statement affirming eligibility for crypto-related economic activities
  • Securing a legal address for at least one year
  • Opening a corporate bank account
  • Transferring the minimum share capital, which is only 1 CZK (approximately 0.04 EUR)
  • Obtaining a mandatory trade license from the Trade License Registry
  • Preparation and notarization of the founding contract
  • Payment of state fees related to registration – 6,000 CZK (approximately 243 EUR)
  • Registration of the company with the Register of Enterprises and Tax Authorities
  • Registration of the company with the FAA for AML/CFT reporting purposes

All requisite documentation must be submitted in the Czech language. If a certified translator is needed, the team at TBA & Associates is available to assist. Alternatively, remote company formation is an option, requiring the signing of a power of attorney to authorize a representative to act on behalf of the entity throughout the crypto company creation process.

Crypto Licensing Procedures

Given the absence of a dedicated crypto-specific license in the Czech Republic, companies intending to participate in crypto-related economic activities must adhere to general authorization processes outlined by the Trade Licensing Register. The crypto licensing process encompasses company formation and may extend up to four months.

In essence, a crypto company is required to submit a comprehensive application in Czech language to one of the general Trade Offices. This application should include essential information about the company and its founders (shareholders), accompanied by a business plan detailing the strategy and operations, along with various supporting documentation. Applications can be electronically submitted with a secure electronic signature to the central Electronic Filing Room of the Trade Register, where they are processed by the relevant competent Trade Licensing Office, as indicated by the applicant.

The evaluation of the application may involve the sharing of information with foreign regulatory authorities. If the application proves successful, a license is granted specifically for designated crypto activities. It’s important to note that the license may sometimes be conditional, necessitating the fulfillment of additional requirements before commencing operations in the Czech Republic.

Upon obtaining a crypto license in the Czech Republic, the licensee is mandated to provide relevant reports, such as client information, to authorities like the Czech National Bank (CNB) and the Financial Analytical Office (FAU). Any errors or refusals may result in the suspension of the license, with no opportunity for obtaining a new one, as the company could be perceived as fraudulent.

Crypto Taxation in Czech Republic

Regardless of the chosen trading license, a crypto company in the Czech Republic becomes subject to common taxation. Taxation procedures are administered by the tax authorities, with the tax year aligning with the calendar year. However, companies have the flexibility to select their accounting year as the tax year.

The tax regime for crypto companies varies depending on the nature of the crypto activity but remains consistent with other businesses unless specific EU legislation is enacted. Notably, the Court of Justice of the European Union (CJEU) has determined that, for VAT purposes, cryptocurrencies like Bitcoin are treated as traditional currency. Consequently, crypto exchange services, involving cryptocurrency for fiat money and vice versa, as well as cryptocurrency for other cryptocurrency, are exempt from VAT.

Companies offering various crypto products and services are required to register as VAT payers. The tax period for newly registered VAT payers is typically a calendar month.

Standard tax rates in the Czech Republic:

  • Corporate Income Tax (CIT) – 19%
  • Tax on branch (BT) – 19%
  • Capital Gains Tax (WCL) – 0%-19%
  • Value Added Tax (VAT) – 21%
  • Social Insurance (SVP) – 24.8%
  • Medical insurance (SA) – 9%

Taxation of companies in the Czech Republic is based on their residency status, with resident companies being taxed on their global income, while non-resident companies are taxed only on income generated within the Czech Republic.

A company is considered a resident taxpayer if it is headquartered in the Czech Republic, and its taxable income is determined according to the accounting profit based on Czech accounting rules.

Reporting Requirements

Crypto licensees must adhere to strict corporate reporting requirements aligned with International Financial Reporting Standards (IFRS). Annual financial statements, including a balance sheet, income statement, and notes, are mandatory. Companies subject to mandatory audit must provide a statement of cash flows and a statement of changes in equity. These statements are published in the Business Register and submitted with the tax return.

Auditing is compulsory for companies meeting at least two of the following criteria:

  • Turnover exceeds 80 million CZK (approx. 3,234,413 EUR)
  • Total assets exceed 40 million CZK (approx. 1,617,206 EUR)
  • Average number of employees is over 50

For those seeking a crypto license in the Czech Republic, TBA & Associates offers comprehensive assistance in company formation, licensing, accounting services, and expert advice on taxation and corporate reporting. The team guarantees efficiency, confidentiality, and meticulous attention to detail, contributing to the success of your business. Contact us for a personalized assistance.

Czech Republic Cryptocurrency License
Readymade Solutions

To acquire a ready-made Czech Crypto currency company for a rapid project implementation, is an available option with TBA.

Frequently Asked Questions

1. Does Czech Republic grant a licence for crypto activities?
Yes. In Czech Republic, crypto companies may apply for 4 different types of crypto licence. The type of licence depends on the activities that a crypto company is looking to provide.

2. How long does it take to get a license?
Due to a straightforward process of establishing a company and applying for a crypto licence in Czech Republic, the process of obtaining a licence may last as little as 3-4 weeks.

3. Can non-residents of Czech Republic own a crypto company?
Yes. Czech Republic crypto companies can be established by any natural person or physical entity. No specific residence restrictions apply.

4. Can non-residents of Czech Republic be part of the board of a Czech Republic crypto company?
Yes. A crypto company in Czech Republic must have 1 director. No specific residential requirements apply.

5. Why should you apply for a crypto license in Czech Republic?
Amongst many other EU member states who offer crypto licenses, Czech Republic stands out due to its loyalty to EU regulation. The country does not apply any additional restrictions on its own. Together with low corporate taxes and generally good conditions for business development in the country, Czech Republic is a very appealing place for establishing and running a crypto business.

6. Are Czech Republic cryptocurrency companies audited?
Yes. Crypto companies in Czech republic are audited if they meet two or more of the following conditions:

Turnover exceeds 80 mill. CZK (approx. 3,234,413 EUR)
Total assets exceed 40 mill. CZK (approx. 1,617,206 EUR)
Average number of employees is over 50

7. Where can I open a bank account for a Czech Republic crypto company?
Crypto businesses in Czech Republic must open a corporate account in any European payment system.

Our company licensing services

— What we do and do not do

Our company is EXCLUSIVELY engaged in assisting worldwide clients, either individuals or corporate entities, to get duly and properly licensed with local Regulators and Financial Authorities to get respective official licenses to legally carry out their cryptocurrency or financial related business activities.

TBA & Associates Tax Business Advisors does not provide or carry out any sort of Cryptocurrency or Financial services!

Disclaimer: While TBA & Associates strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact TBA Customer Services for advice on your specific cases.

We help you grow your business across international border and achieve financial efficiency.

We are ready to answer all your questions!