Property depreciation
Tax depreciation lets you gradually claim the value of a rental property as an expense. No extra money leaves your account because of it. The amount is set by statutory rules and the property’s tax base value. Depreciation can be claimed only if you deduct actual expenses, not on top of the 30% flat-rate allowance.
Also known as: flat depreciation, tax depreciation, depreciating a property, property base value
What value depreciation is based on
Before calculating your first depreciation, determine the base value, whether the property can be depreciated and its depreciation group. Land value is not depreciated. A standard residential unit usually falls into group five, with a minimum depreciation period of 30 years. Those thirty years are purely a tax depreciation period – they say nothing about how long the flat will last.
How and when you acquired the property also matters. Did you buy the flat and more than five years pass between the purchase and the start of the tenancy? Then the law works with the replacement cost (reprodukční pořizovací cena). Inheritance and gifts are assessed separately. Neither an old purchase contract nor an advertised price determines the base value on its own. Income Taxes Act (zákon o daních z příjmů), § 26 to § 30.
How much depreciation actually saves
An example for illustration: the verified depreciable base value of a standard unit is 4 000 000 Kč. The first straight-line annual depreciation at the standard rate of 1.4% comes to 56 000 Kč. Provided the statutory conditions are met, this amount reduces your tax base – not the tax itself. The example assumes the flat is used entirely for taxable rental. Straight-line depreciation rates are set out in § 31.
Under certain conditions you can suspend depreciation. Switching to the flat-rate expense allowance, however, does not count as a suspension: depreciation continues on paper and the depreciation period is not extended by those years. So compare the flat rate with your actual expenses and look ahead to future years too. Keep records of the acquisition cost and any technical improvements with your depreciation schedule.
Let your manager know if you already depreciate the flat. A bank statement of rent payments cannot replace a depreciation schedule or a property valuation. Go through your depreciation setup with an accountant or tax adviser.
Sources checked on 13/09/2026. A general explanation does not replace a review of your specific contract or individual legal or tax advice.
← Back to the glossaryWould you like a rental without worries?
We take care of tenants, contracts, payment monitoring and repairs. In a free consultation we go through your flat and recommend how to set the management up.