Family

Financial support for families

Financial support for families takes place in two main regions of tax measures and the social security system.

Tax measures

Families are provided indirect financial support through tax measures. These include, without limitation:

• calculation of tax on a joint tax basis of married couples (joint taxation)
  Starting from the tax period of 2005, married couples who maintain at least one child are provided an option, under Sect. 13a, Act No. 586/1992 Coll., on income taxes, as amended (hereinafter "the Act"), to make use of the institute of calculation of tax on a joint tax basis, i.e. joint taxation of married couples. The institute may (even significantly) reduce a couple's overall tax liability subject to certain circumstances, in particular if one of the spouses has no taxable income or if incomes of both spouses differ. Married couples may split their joint tax basis between them (each of the spouses taking a half after claiming tax exemptions, subject to satisfying requirements applicable to such claims).
• tax allowance
1. a) tax benefit for a maintained child living in the household with the taxpayer (tax allowance, or, tax bonus)
   The amended Act No. 586/1992 Coll., on income taxes, as amended (hereinafter "the Act"), as of 1 Jan. 2005, replaced the tax exempt proportion of the tax basis for a maintained child with a new institute "tax benefit for a maintained child living in the household with the taxpayer". The child tax benefit, as opposed to the tax exempt proportion of the tax basis, is deduced not from the tax basis but, at the assessed amount, directly from the computed tax or, in case of employees, from the advance tax calculated for separate calendar months. The tax relief consists in reduction of the computed tax (or, monthly advance tax in case of employees) by the assessed tax allowance. If the tax calculated for a low-income taxpayer is lower than the tax benefit (tax allowance) amount, such taxpayer shall become eligible for being paid a tax bonus. In order to obtain the tax bonus, the taxpayer should be economically active, i.e. she or he should generate a taxable income equal to at least six multiples of the minimum wage over the tax period, or, equal at least to the minimum wage in case of the monthly wage taxation.
2. b) tax deduction for a husband or wife
   A tax deduction may be claimed for a husband/wide living in the household, whose incomes do not exceed CZK 38 040 per calendar year, while the annual tax allowance amounts to CZK 4 200 per maintained wife/husband.

For further information on the tax measures for families, kindly visit the Internet pages of the Ministry of Finance of the Czech Republic.

Social security system

Families may obtain "family benefits" using the following institutes:

• Social insurance
  
  A citizen (family member) participates in the social insurance system to assure herself or himself for future insured events such as an accident, sickness, maternity, old age, disability, unemployment or loss of the breadwinner, for situations of a threatened or lost income of such person. In such foreseeable adverse social circumstances, the person is eligible either for the benefits released by the sickness insurance system: maternity cash assistance; pregnancy and maternity compensation benefit; and benefit for care of a family member, or for the benefits under the pension insurance system: old-age pension (including early retirement pension); full disability pension; partial disability pension; widow's and widower's and orphan's pension.
  
  For further information on separate types of benefits, kindly refer to: sickness insurance benefits system and pension insurance.
  
  
  
• State social support
  The state social support system has been laid down by Act No. 117/1995 Coll., on state social support, as amended.
  
  The concept of state social support includes subsistence benefits provided to the persons (family members) who have encountered socially qualified social neediness situations, while the government, through payment of the benefits, has been accepting a share in responsibility for such emerged situation. The following are provided under the state social support system: child allowance, parental allowance, social allowance, housing allowance, birth grant, funeral grant and foster care allowances and allowance for school aids.
  
  For further information on separate types of benefits and contact points with which applications for the above benefits may be filed, kindly refer to: state social support benefits.
  
  
  
• Social assistance
  In case a family, for various reasons, encounters social neediness circumstances, i.e. it is lacking resources to cover its very basic living needs or finds itself in a defined difficult life situation, it is enabled a possibility to obtain social assistance benefits for families and children. The benefits currently include the following types: child maintenance benefit; cash and in-kind benefits to parents of dependent children, pregnant women and dependent children; allowance at contracting of marriage; allowance for acquisition of child's basic equipment prior to entrusting the child to foster care; allowance for settlement for use of flat of an orphaned dependent child; and, allowance for recreation of pensioner's child.
  
  
  
  For further information on separate types of benefits a contact points with which applications for the above benefits may be filed, kindly refer to: social assistance benefits system.

More information - The Ministry of Labour and Social Affairs