Since 2024, the institution of the minimum corporate tax hasbeen reintroduced into the Slovak legal system. This obligation applies tolegal entities, and its amount is determined by the total of taxable income(revenue) for the tax period. Unlike in the past, whether a company is a VATpayer no longer plays a role.
Minimum tax rates from 2024:
- Income up to €50,000: €340
- Income over €50,000 up to €250,000: €960
- Income over €250,000 up to €500,000: €1,920
- Income over €500,000 up to €5,000,000: €3,840
- Income over €5,000,000: €11,520
Specific Questions and Answers for Entrepreneurs
1. What if the company did not operate for the entire year?
If the tax period is shorter than 12 consecutive calendarmonths, the minimum tax is paid on a proportional basis. It is calculated as1/12 of the annual amount for each calendar month of the tax period.
2. Which companies are exempt from the minimum tax? Theminimum tax is not payable, in particular, by:
- Newly established taxpayers for the year in which theywere formed (unless they were formed through legal succession).
- Entities not established for the purpose of business,general partnerships (v.o.s.), and the National Bank of Slovakia.
- Companies in the process of bankruptcy or liquidation.
- Registered social enterprises.
- Land associations with taxable income of up to €10,000.
3. Can companies employing persons with disabilities reducethe minimum tax?
Yes, if the average registered number of employees withdisabilities constitutes at least 20% of the total average registered number ofemployees, the minimum tax is reduced by half.
4. How does the credit of the minimum tax paid work in thefuture?
The positive difference between the minimum tax and the taxcalculated in the tax return may be credited against the tax liability in amaximum of three immediately consecutive tax periods. However, the credit isonly possible against that part of the tax liability that exceeds the minimumtax amount in the given year. The entitlement to the credit expires on the datethe company enters liquidation or bankruptcy.
5. Can a company in the lowest bracket (€340) donate 2% ofits tax?
Although the law allows a taxpayer who has paid the minimumtax to declare the allocation of a share of the tax paid, this is not feasiblefor the amount of €340. The statutory 2% of this amount equals €6.80, whichdoes not reach the minimum threshold of €8 established for legal entities perrecipient. Companies with a higher minimum tax (€960 and above) already meetthis condition.
6. Does the minimum tax also apply to foreign companies?
Yes, if the entity is a taxpayer with limited tax liabilityoperating in Slovakia through a permanent establishment.
7. Does the minimum tax affect overpayments from taxadvances?
If the tax advances paid exceed the calculated tax, but thistax is lower than the prescribed minimum tax, the positive difference betweenthe advances and the minimum tax is either refunded upon request or credited tofuture periods. The positive difference between the minimum tax and the lowercalculated tax is subsequently recorded for credit in future years.
The content of this article is for informational purposesonly and in no way replaces professional legal, tax, or accounting advice. Thecompany Dravecký & Partner bears no responsibility for any decisions madebased on the information provided herein, nor for any potential damage thatmight arise from such actions. Before applying any information to your specificsituation, we strongly recommend consulting with a qualified expert.
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