Company registration in Slovakia

To determine the tax residency of the legal entity, registered in Slovakia, management and control should be carried out from the territory of Slovakia. Residents subject to taxation of all income received from sources worldwide. The income of non-residents is subject to taxation only if it is obtained from a source in Slovakia.

The corporate income tax rate is 21%. A reduced tax rate of 10% applies to legal entities and entrepreneurs with income up to 100,000 euros, and 24% for income over 5 million euros.

The VAT rate is a standard rate of 23%. Reduced rates of 19% and 5% (applies to medical goods, products, etc.). Insurance and financial services are exempt from VAT.

Registration as a VAT payer is mandatory if the company conducts commercial activities and receives profit in the country, or if it receives annual profit of more than 62,500 euros.

In Slovakia, the concept of "tax license" applies, which implies the payment of a minimum tax by companies in the following amount:

• 340 euros for annual income up to  50,000 euros;
• 960 euros for annual income from  50,000 to  250,000 euros;
• 1,920 euros — for annual income from 250,000 to 500,000 euros;
• 3,840 euros — for an annual income of more than 500,000 euros.

Obligation to pay the tax license does not extend on the first financial year.

Taxation of dividends: rate of 7%, if a Slovak company pays dividends to a tax resident of Slovakia or a tax resident of a state with which a double taxation treaty has been signed. If dividends are paid to a tax resident of a state with which a double taxation avoidance agreement has not been signed, the rate will be 35%.

Taxation of interests and royalty: rate 19 % while paying to the residents of EU and 35 % while paying to non-residents of the EU.

When opening a company in Slovakia, stamp duty is charged depending on the form of filing registration documents.

None.

Slovakia has signed 70 international tax treaties, including agreement with Ukraine.

In the business world, Slovakia is often mentioned as an "offshore in Slovakia," although technically it is not an offshore jurisdiction, but a fully-fledged EU jurisdiction with transparent rules and tax policies. This is why registering a company in Slovakia is suitable for those who want to operate legally in Europe, access the EU banking system, and take advantage of the proposed regulatory environment.

An important aspect: the company director must have a Slovak residence permit, as this is a requirement for effective management and the performance of official duties. The company structure is simple, registration procedures are quick, and the tax system allows for cost optimization within the law. This has made the country popular for businesses seeking to minimize risks, remain protected by European law, and avoid the reputation of classic offshore jurisdictions.