Return to the original regime: sales of companies and shares once again exempt from income tax

From 1 January 2026, investors and business owners will see another significant change. The Chamber of Deputies approved an amendment to the Income Tax Act on a proposal of the Senate, which abolishes the current limit of CZK 40 million for the exemption of income from the sale of shares and business interests. The amendment was signed into law by President Petr Pavel in September 2025 and from 2026 the tax regime will return to the simpler rules that applied until the end of 2024.

What rules have applied so far

Until the end of 2024, the model was simple: anyone who held shares for at least three years or a stake in a company for five years could exempt the income from their sale from tax, regardless of the amount. However, from January 2025 a new limit came into effect – if the total sum of such income for the tax period exceeds CZK 40 million, the part exceeding this ceiling will be taxable. In practice, this means that, for example, when a share is sold for CZK 80 million, CZK 40 million is exempt and the rest is taxed at a tax rate of 15% or 23% depending on the tax base. Tax expenses can only be claimed in part according to the proportion of taxable and exempt income from the sale.

We have already written in detail about this change in a separate article on the taxation of income from the sale of securities from 1 January 2025.

What changes from 2026

The amendment to the law completely abolishes the ceiling of 40 million on shares and stocks. Thus, for individuals, again, if they meet the time test (holding for 3 years for shares, 5 years for stocks), the sale proceeds will be fully exempt regardless of the amount of the transaction.

The original proposal also included an exemption for income from the sale of cryptocurrencies. Senators subsequently removed the tax exemption for sales of cryptoassets over CZK 40 million from the amendment, citing the recent bitcoin scandal. The threshold of CZK 40 million for cryptocurrencies remains unchanged. Investors in digital assets must therefore continue to expect to tax a portion of the proceeds when selling higher volumes.

Why the limit is being lifted

The cap was originally introduced to bring more money into the state budget and to limit high tax breaks. However, practice has shown that the expected effect has not been achieved. State revenues did not increase significantly and the rule brought more complications – complex calculations, the intention to spread transactions over several years and less legal certainty for investors and business owners. The government has therefore supported a return to the original model, especially for the benefit of family businesses and long-term investors. Thus, the amendment merely removes a dysfunctional rule that did not serve its original purpose.

Practical implications for taxpayers

• Sale of shares and stock: From 2026, it will no longer be necessary to keep track of the aggregate amount of income from sales to avoid excessive tax burden. Meeting the time test will mean full exemption, whatever the level of income.
• Cryptocurrencies: The limit of CZK 40 million per tax year remains. Investors should therefore continue to carefully plan the structure and timing of their sales.

Final recommendations

If you are considering selling a significant stake or a larger number of shares, it may be worth timing the transaction for 2026, when the income will be fully exempt if the statutory conditions are met. For cryptocurrencies, on the other hand, the rules do not change and the limit must still be taken into account.