Changes in law 2025

Basic exemption of income tax

From January 1, 2025 the general rate of tax-free income for a natural person resident will be 700 euros per month ( 8400 euros annually). Tax-free income does not apply to a resident of a third country.

Income tax rate will rise

From January 1, 2025 the income tax rate will be (20 % until Dec 31, 2024).

Income tax rate of a legal person will rise

From Jan 1, 2025 the income tax rate of a legal person will be 22/78 (20/80 until Dec 31, 2024).

For example, if 1,000 euros is paid out as net dividends to the owner’s bank account until Dec 31, 2024, the total tax cost (at the standard income tax rate) is 250 euros. In case of the payouts from Jan 1, 2025, the income tax is already 282.05 euros (12.82% increase in tax liability).

The lower tax rate on dividends will disappear

The lower tax rate 14/86 on dividends and 7% income tax on dividends paid to natural persons will disappear. Thus, from 2025, dividends will be taxed only at a rate of 22/78.

Special lower VAT rates will change

From January 1, 2025 the following changes will be applied:

  • accommodation services and accommodation services with breakfast are taxed at 13% VAT rate instead of the current 9%
  • VAT rate for press publications will rise from 5% to 9%.

Opportunity to change the rate of contribution to the funded pension

From January 1, 2024, persons who have joined the II pillar of the funded pension have the opportunity to increase their funded pension contribution rate from 2% to 4% or 6%. To apply the change, a corresponding application must be submitted to the keeper of the pension register or the account administrator within the period Jan1, 2024 to Nov 30, 2024. The new rate will apply from Jnauary 1, 2025. If a person has several employers, the new rate will be applied at all employers. The state’s contribution, 4%, will not change.