A medical limited company works similarly in Slovakia and Czechia: most of its services are exempt from VAT without the right to deduct input tax – under Section 29 of the Slovak VAT Act and Section 58 of the Czech VAT Act – while it still pays ordinary corporate income tax and follows the same rules for depreciation and deductible costs as any other business. The core principle is shared, but the thresholds, rates and cash-recording duties differ between the two countries.
Doctors, dentists and physiotherapists increasingly run their practice through a limited company (s.r.o.) rather than as a sole practitioner. The reasons are practical – limited liability, easier hiring and cleaner financing of equipment. The accounting and tax rules, however, diverge from an ordinary trading company, and the details differ across the border.
When are healthcare services exempt from VAT?
In both countries, healthcare provided with a therapeutic aim – prevention, diagnosis, treatment or protection of health – is exempt from VAT. Slovakia governs this in Section 29 of Act No. 222/2004 Coll., Czechia in Section 58 of Act No. 235/2004 Coll. It does not matter whether the patient or the health insurer pays for the service.
The catch is identical on both sides: it is an exemption without the right to deduct input VAT. The clinic charges no VAT on its services, but also cannot reclaim VAT on equipment, materials, energy or software. VAT therefore becomes a real cost that enters the acquisition price of assets and everyday running costs.
Which procedures are taxable instead?
Not every procedure has a therapeutic aim. Following the case law of the Court of Justice of the EU, only services aimed at prevention or treatment are exempt. Purely aesthetic procedures without a medical purpose are taxable – at the standard rate of 23 % in Slovakia and 21 % in Czechia. Commercial expert opinions or renting premises to other doctors can also be taxable supplies.
The registration threshold differs. In Slovakia a provider must register for VAT once taxable turnover exceeds EUR 50,000 a year; in Czechia the limit is CZK 2,000,000 per calendar year. A mixed practice combining exempt and taxable outputs must apportion input VAT through a coefficient, which makes the bookkeeping noticeably harder.
How is medical equipment depreciated?
Devices and fit-out are tangible assets depreciated under the income tax rules. The capitalisation threshold differs: EUR 1,700 in Slovakia and CZK 80,000 in Czechia. Medical devices typically fall into the second depreciation group – six years in Slovakia, five years in Czechia. Smaller items below the threshold can be expensed in one go. You can read more in our overview of Slovak tax advisory for companies.
Which costs can a medical company claim?
Beyond equipment and consumables, a medical company has a range of directly related, deductible expenses:
- Mandatory continuous professional education – courses, congresses and specialist literature.
- Chamber membership fees – registration with the medical chamber is a condition for practising in both countries.
- Professional liability insurance, which providers are legally required to hold.
- Medical materials and drugs consumed during procedures, plus disinfectants.
- Rent of the surgery, energy, cleaning and disposal of medical waste.
The general rule applies to each cost – it must relate to earning income and be properly documented, which is the backbone of professional accounting in Slovakia.
What corporate tax does a medical company pay?
Slovakia applies a corporate income tax of 10 % where taxable income (turnover) is up to EUR 100,000, 21 % above that and 24 % above EUR 5 million, so most clinics effectively pay 10 %. Czechia applies a flat 21 %. After tax, the owner-doctor can distribute profit as a dividend, taxed separately in each country.
What about cash and record-keeping?
Here the countries diverge most. Slovakia still runs the eKasa online cash-register system, so a clinic taking cash from self-payers generally records those sales through it. Czechia abolished its electronic sales records (EET) on 1 January 2023, so Czech clinics have no such duty – but must still book cash properly and keep documents. In both cases, cleanly separating exempt from taxable outputs and keeping solid records is what decides a tax inspection.
Are you setting up a clinic as a limited company, or dealing with VAT, depreciation and the line between exempt and taxable services in an existing practice in Slovakia or Czechia? We will set up your accounting and tax regime to fit the healthcare sector.
FAQ
Does a medical limited company have to pay VAT?
Not on healthcare with a therapeutic aim – that is exempt under Section 29 (Slovakia) and Section 58 (Czechia) of the VAT Act. VAT applies to services without a medical purpose, such as purely aesthetic procedures or commercial reports. Once taxable turnover exceeds EUR 50,000 (Slovakia) or CZK 2,000,000 (Czechia), the clinic must register for VAT.
Can a medical company reclaim VAT on equipment?
Not for exempt healthcare. Because it is an exemption without the right to deduct, VAT on purchased devices, materials and services is a real cost that enters the acquisition price of the assets. Input VAT can be recovered only to the extent of taxable supplies, usually through a coefficient.
How is medical equipment depreciated in Slovakia and Czechia?
Equipment above the capitalisation threshold (EUR 1,700 in Slovakia, CZK 80,000 in Czechia) is depreciated over time, typically in the second group – six years in Slovakia and five years in Czechia. Smaller items below the threshold can be expensed immediately.