Unlike various countries that use systems for automatic tax deduction and pre-filled tax return, Slovakia follows the procedure common within the European Economic Area: employed individuals are to submit income tax returns for each calendar year within 3 calendar months after the year in question. This practice may seem complicated and frustrating to newcomers in Slovakia who are not familiar with the intricacies of taxation in Europe. Not to worry – if done correctly, the procedure will maximize your deductions and tax credits and will possibly end in higher refunds.

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In this article, we explain the difference between tax reconciliation (type A) and tax return (type B), outline the key principles of Slovakian income tax return system (types of personal income subject to taxation, deadlines for submission, etc.), and touch upon the role of an EOR (Employer of Record) provider in the procedure.

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What is the difference between income tax return and tax reconciliation?

Tax reconciliation (type A) is a form of tax report applicable for individuals whose sole source of income comes from employment. In this case, the employer is requested to calculate and provide tax reconciliation on an annual basis. The calculation may result in reimbursement to OR deduction from the employee’s salary (the deadline is March of the following year). If there were no under-/overpayments, the employee will receive their usual salary.

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An individual who had more than one employer within one calendar year may request any of them to process the tax reconciliation.

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Individuals who have additional sources of income are eligible for submission of personal income tax return (type B). These sources of income may include:

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• income from business/self-employment
• rental income
• income from the craft work
• income from capital assets, bonds, shares
• a combination of these sources

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If an individual received several types of income within the calendar year, they only submit one personal income tax return (no tax reconciliation needed) for the aforementioned year. Unlike tax reconciliation, tax returns are prepared and submitted independently. In case one or more additional sources of income are combined with employment, the individual may request their employer to issue a Certificate of Taxable Income which is included in the tax return. It is important to note that the employer may but is not legally required to fulfill the request, and the individual remains solely responsible for the correct and timely submission of the tax return.

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Who needs to submit an income tax return in Slovakia?

An individual is considered a tax resident if they hold a local citizenship or a permanent residence permit, reside in Slovakia for a total of 183 or more days in the calendar year, and receive income on a Slovak bank account.

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How do I submit an income tax return in Slovakia?

Income tax return must be submitted (electronically or by post) to the relevant tax office according to an individual’s permanent place of residence. This can be done through a professional accountant or tax advisor who helps the individual to prepare the report and include tax-free parts and tax bonuses if applicable (e.g. a non-taxable portion per spouse or a tax bonus for a child).

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Individuals can also choose to donate 2 or 3 % of the tax to a registered non-profit organization of their choice or to a local school/preschool.

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What is the deadline for submitting an income tax return in Slovakia

Income tax returns for each calendar year must be submitted to the relevant tax office within 3 calendar months after the year in question. Thus the annual deadline is March 31.

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IMPORTANT! The deadline for submitting tax returns for the calendar year of 2023 is April 2, 2024 (since March 31, 2024 is a Sunday and April 1, 2024 is a public holiday).

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If it takes an individual more time to file the income tax return, they must notify the relevant tax office and request an extension of the deadline. In this case, the new deadline will be June 30 or September 30.

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My company has employees in Slovakia. How do we support them in submitting the income tax reconciliation/return?

As mentioned above, your employees may ask you to provide them with tax reconciliation or Certificate of Taxable Income for tax return (depending on their individual situation). However, this is not legally required and can only be carried out if you have experienced tax advisors onboard. Otherwise, your employees will require help from a third party that offers accounting services and tax advice.

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Acvian offers comprehensive support for handling your business taxes in Slovakia. We also provide tax return assistance to your employees, include all eligible bonuses and deductions in their reports, and make sure their paperwork is done compliantly and punctually. This is especially important in complex cases when an individual receives income from multiple sources apart from employment –delegating the procedure to an experienced team means saving your internal resources for top-priority tasks.

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Contact us today to find out more about tax solutions with Acvian EOR.