[Czech Republic] Changes to cafeterias effective 1 January 2026

On 1 January 2026, an amendment to the Income Tax Act will enter into force, having a significant impact on the system of optional employee benefits that involve transferring part of an employee’s salary into a cafeteria system or onto benefit cards.

The current legislation allowed non-monetary benefits to be exempt from personal income tax if the legal conditions were met. However, the exemption will now only be possible for non-monetary benefits that are not in the nature of wages, salaries, remuneration, or compensation for lost income. The aim of this amendment is to clearly separate employee benefits from wages in kind.

How to proceed as of 1 January 2026?

From 1 January 2026, funds transferred to cafeterias and similar employee benefits from part of the salary or bonuses will be considered as taxable income. These amounts will therefore be subject to taxation and social and health insurance contributions.

However, non-monetary benefits provided beyond wages, salaries, or other remuneration for work performance, from the cultural and social needs fund, the social fund, profit after tax or against non-tax expenses, will remain exempt if they are intended for legally specified purposes.

You can find more detailed information in an article by our sister company Crowe at the link provided here.

Want to know how to adapt your work regulations, payroll and internal HR procedures to these changes?