The corporate tax rate in the Czech Republic is 19%. Corporate income tax applies to the profits generated by all companies, including branches of foreign companies. Czech resident companies are required to pay income tax derived from worldwide sources. A 5% corporate income tax rate applies to certain investment funds, and a 0% rate applies to pension funds.
The arm’s length principle is contained in the Czech Income Tax Act 586/1992 Coll., Section 23 para 7. The OECD TP Guidelines is not implemented into the Czech tax legislation directly, but in the Guideline D-22 is the recommendation to use TPG.