Tax deduction for examinations stipulated by Act 179/2006

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Name of the instrument - Local language
Odpočet úhrady za zkoušku podle zákona 179/2006
Name of the instrument - English translation
Tax deduction for examinations stipulated by Act 179/2006
Scheme ID
40
Country
Czechia
Reporting year
2020
Type of instrument
Tax incentive for individuals
Sub-type of instrument
Incentive for particular training activities and/or particular groups
Type of entry
Single instrument
Short description

Adults that paid for an examination of a vocational qualification listed in the Register of Qualifications NSK (but not a training course) and that submit income tax returns, can deduct the costs of validation of their learning from their individual income tax base up to a set maximum limit - CZK 10 000 (approx. EUR 396). The state co-funding - in the form of foregone tax revenues - equals the eligible costs multiplied by the marginal tax rate (between 15 % and 23 %). A higher amount can be deducted for groups with preferential treatment: CZK 13 000 (approx. EUR 515) for adults with disabilities, and CZK 15 000 (approx. EUR 594) for adults with heavy disabilities. The tax incentive can be used once in each calendar year. The incentive has been rarely used in the past years.

Level of operation
National
Name of a part of the country
Not applicable
Name of the region (for regional instruments)
Not applicable
Name of the sector (for sectoral instruments)
Not applicable
Relevance
Further instrument
Act 179/2006 on the recognition of the outcomes of further learning, Act 586/1992 on income tax
Objective(s) and target(s)
Not available
Year of implementation
2007
Operation/management
Ministry of Finance (Financial Office) is tax revenue collector. Ministry of Education, Youth and Sports is responsible for verification of the outcomes of further learning (VNFIL)
Eligible group(s)
All adults paying out of pocket for an examination of a vocational qualification (but not a training course) and who submit income tax returns are eligible for the tax deduction. According to this criterion, the tax incentive de facto excludes unemployed persons, people with very low income (less than 15 000 a year), and people with (heavy) disabilities, whose only income is a disability pension, as their pension (income) is not taxable.
Group(s) with preferential treatment
Adults with a disability can deduct up to CZ 13 000 (approx. EUR 515) from their tax base. Adults with a heavy disability can deduct up to CZ 15 000 (approx. EUR 594) from their tax base.
Education and training eligible
Only examinations validating prior learning are covered. Exams organized under Act 179/2006 on the recognition of the outcomes of further learning; i.e. "vocational qualifications" (formerly referred to as "partial qualifications"). No actual learning content is eligible.
Source of financing and collection mechanism
State (loss of tax revenue). Paid out as reduction in taxes due.
Financing formula and allocation mechanisms
An applicant may deduct eligible costs from their annual income during the tax period and thus reduce the taxable income for the relevant tax period. The costs are deductible from the tax base, for a 15% effect. The maximum amount/deduction from the tax base is CZ 10 000 (EUR 396). The maximum deduction from the tax base for people with disabilities is EUR 515, for people with heavy disability it is EUR 594. The maximum share of examination expenses that may be deducted from the tax base is 100% of costs covered (but no more than the maximum amount). Only fees for participation in the final examination (i.e. when the participant gets a nationally recognized certificate of vocational qualification listed in the National Register of Qualifications NSK) can be covered. This scheme can be used once per calendar year but can cover an arbitrary number of fees (under CZ 10 000 total, EUR 396), as it is claimed when filing taxes.
Eligible costs
Examination costs
Volumes of funding
Overall costs:2016: CZK 193 238 (approx. EUR 7 145)2017: CZK 160 162 (approx. EUR 6 287)2018: CZK 158 555 (approx. EUR 6 224)
Beneficiaries/take up
Total beneficiaries:2016: 3062017: 2542018: 245
Organisation responsible for monitoring/evaluation
Ministry of Finance (Financial Office)
Monitoring/evaluation reports available
Not available
Most relevant webpage - in English
https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=NIM%3A139833
Most relevant webpage - local language
https://www.financnisprava.cz/cs/dane/dane/dan-z-prijmu/dotazy-a-odpove…
Recent changes

No recent amendment

Recent changes in response to COVID-19

No changes

Sources
Financial Office
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