The most positive news of the last quarter is the Amendment to the Income Tax Act, adopted by the Slovak Parliament at the beginning of September. We are pleased to confirm that all originally planned business-friendly changes were approved in ordinary legislative procedure on 11 September, which is unusually early: more than 3 months before becoming applicable (01/01/2020). This means taxpayers have enough time for tax planning. In addition, an MP’s proposal to decrease the income tax rate for small entrepreneurs from 21% to 15% was approved on 19 September.
The new tax rate will apply not only to companies, but also to all sole traders and self-employed persons with an annual turnover up to EUR 100 thousand. The most significant advantage for companies is the increase of the “super deduction” of R&D costs to 200% of legitimate costs. In other words, through this relief the state will refund over 40% of expenses for innovations to businesses.