Tax resident

What it means

A Slovak tax resident is taxed here on worldwide income, wherever it arose; a non-resident is taxed only on Slovak sources. An individual is resident with a permanent address or a home here, or by being present at least 183 days in the calendar year.

A company is resident if its seat or its place of effective management is in Slovakia. When two states both claim a person, the double taxation treaty decides; the tie-breakers are set out under tax domicile.

Citizenship does not decide residence. A Slovak living with his family in Austria may be a Slovak non-resident, and a foreigner with a flat and a job in Bratislava a resident. When employing foreign nationals, an employer therefore reads tax status not from the passport but from where the person actually lives.

How it works in practice

Foreign income always goes into the return, even when it has already been taxed abroad. Double taxation is removed by the credit or the exemption method under the relevant treaty, not by leaving the income out of the return.

Residence is proved by a certificate the tax office issues on request. A foreign payer asks for it before applying a reduced withholding rate: without it the full rate is withheld, and reclaiming the difference takes a long time.

In a company with a foreign director we watch where decisions are really taken. If the director runs the Slovak s. r. o. from another country, that country’s tax office may argue the place of effective management is there; minutes of decisions and where they were signed then become the main evidence.

What to watch out for

Moving abroad does not by itself change residence. Someone who leaves to work abroad but keeps a permanent address and family here usually stays a Slovak resident, and since states exchange account data automatically, undeclared foreign income surfaces years later.

A credit for foreign tax is refused without proof that the tax was actually withheld or paid abroad. Anyone who does not ask the foreign employer or authority for a certificate in time pays Slovak tax on the whole income and then sorts out the difference through a supplementary return.