A Czech citizen working in the UAE stays a Czech tax resident if they keep a home in the Czech Republic with the intention of living there permanently, even with fewer than 183 days there. A resident is taxed on a UAE salary at 15% (23% above the high-income threshold), because the Czech exemption for foreign employment income only applies to income that “was taxed in the source state”, and a UAE salary is not. The new Czech to UAE treaty, applied from 1 January 2025, is the way out, but its UAE residence test has a condition the old one did not.
This guide is for Czech citizens living and working in the UAE. It covers the two residence tests in the Income Tax Act, why the usual exemption for foreign salaries does not help, the 2023 treaty that replaced the 1997 one, and the health insurance declaration that stops premiums running while you are abroad.
The UAE side is simple. The UAE does not tax employment income, as our guide to what a tax-free salary really means explains, so every question here is about the Czech Republic. Hungarian citizens get a very different result, because their treaty exempts UAE salary, as explained in Hungarians in the UAE: resident by citizenship, exempt by treaty.
Two Ways to Be a Czech Tax Resident
Section 2 of the Income Tax Act (No. 586/1992 Coll.) makes you a Czech tax resident if you have a domicile (bydliště) in the Czech Republic or habitually stay there. Residents are taxed on income from Czech and foreign sources.
| Test | Section 2(4) wording | Typical Czech in Dubai |
|---|---|---|
| Habitual stay | At least 183 days in the calendar year, continuously or in several periods, counting every started day | Usually not met |
| Domicile | A place where you have a permanent home in circumstances showing an intention to stay there permanently | Depends on what you did with your flat and why you left |
Domicile is a factual test. Permanent residence registration (trvalý pobyt) is not the same thing, but a flat you kept, furnished and available, with a plan to return after a fixed contract, points to a Czech domicile. A flat sold or let long-term, a family that moved with you, and an open-ended UAE job point the other way.
Why the Czech Exemption for Foreign Salaries Does Not Apply
Many Czechs working abroad pay nothing in the Czech Republic because of Section 38f(4) of the Act. It exempts employment income for work performed in a state with which the Czech Republic has a comprehensive tax treaty, paid by an employer resident in that state.
The exemption applies only “provided that the income was taxed in the source state”. A UAE salary is not taxed in the UAE, so the condition fails. The general rule in Section 38f(1) then applies: relief follows the treaty, and the treaty gives only a credit for UAE tax paid, which on a salary is zero.
The result for a Czech resident is tax under Section 16 at 15% on the part of the tax base up to 36 times the average wage, and 23% on the part above it.
The New Czech to UAE Treaty
The Czech Republic and the UAE signed a new treaty in Prague on 24 May 2023. According to the Ministry of Foreign Affairs communication published as No. 206/2024 Coll., it entered into force on 29 May 2024. Under its Article 28, it applies to income for tax years beginning on or after 1 January 2025, and the 1997 treaty (No. 276/1997 Coll.) stopped applying from that date
| Article | What it says | Why it matters to you |
|---|---|---|
| 4(1)(a) | A UAE resident is any person considered a UAE resident under UAE law, provided that person is not a resident of a third state | No nationality condition, but if another country (for example, where you also have a home) treats you as resident, you fall outside the UAE definition |
| 4(1)(b) | A Czech resident is a person liable to Czech tax by reason of domicile, residence, place of management or a similar criterion | Matches Section 2 of the Act |
| 4(2) | Tie-breaker: permanent home, center of vital interests, habitual abode, nationality, mutual agreement | Decides which country wins if both treat you as resident |
| 15(1) | Salary is taxed only in the state of residence unless the work is done in the other state, which may then tax it | If the UAE wins the tie-breaker, the Czech Republic cannot tax your UAE salary |
| 22(1) | Double tax is relieved by a credit for tax paid in the other state | If the Czech Republic wins, the credit is worth nothing |
The third-state condition
Article 4(1)(a) is more generous than the 1997 treaty in one way and stricter in another. It ties UAE residence to UAE law rather than to being taxed in the UAE, which suits individuals in a country without personal income tax. But it excludes anyone who is resident in a third state.
That matters for people who live partly in the UAE and partly somewhere else, for example a Czech who spends the summer at a home in Spain or keeps a family home in Slovakia. If that third country treats you as its resident, you are not a UAE resident for this treaty.
How the tie-breaker usually plays out
Step (a) asks where you have a permanent home available. A long-term Dubai lease is one. A Prague flat that stays furnished and empty for your visits may be another. If you have a home in both, the question becomes where your personal and economic relations are closer: family, employer, bank accounts and social life.
For evidence of UAE residence, use a tax residency certificate from the Federal Tax Authority, as our UAE tax residency certificate guide explains, together with your lease and employment contract.
Health Insurance: The Six-Month Declaration
Czech public health insurance follows permanent residence, not tax residence. Under Section 8(4) of the Public Health Insurance Act (No. 48/1997 Coll.), you can stop paying premiums while you are abroad long term, meaning a continuous stay of more than six months, if you are insured abroad and make a written declaration to your Czech health insurer.
- From when: premiums stop on the date stated in the declaration, but not before the day after the insurer receives it.
- The trade-off: from that date until you register again, you have no right to care covered by Czech insurance.
- On return: when you register again, you must show proof of your foreign health insurance and how long it lasted. Without it, you pay the premiums back as if you had never deregistered, though without penalties. Any month not fully covered abroad must also be paid.
- Timing: a new declaration can be made only after two full calendar months have passed since you registered again.
UAE employers must provide health insurance for employees, so most people have the foreign cover the law requires. Keep the policy documents for the whole period. Our guide to health insurance in Dubai covers what the UAE requires.
If You Are Non-Resident
A non-resident is taxed only on Czech-source income under Section 22 of the Act, such as rent from a Czech flat, Czech dividends and pay for work done in the Czech Republic. The 1997 treaty and older guidance no longer apply to income from 2025 onward.
The Order to Do This In
- Test domicile honestly. Decide what you are doing with your Czech flat and whether your stay in the UAE is open-ended.
- Check the third-state condition if you spend significant time in a third country.
- Get a UAE tax residency certificate for each year and keep your lease, contract and family records.
- If you remain a Czech resident, declare your UAE salary and pay tax at 15% or 23%. The Section 38f(4) exemption does not apply to untaxed income.
- Make the health insurance declaration if you will be abroad for more than six months, and keep proof of your UAE cover.
If you are planning a permanent move, our guides to leaving the UAE permanently and sending money from the UAE cover the UAE side.
What We Could Not Verify
- The 2026 high-income threshold in Czech koruna. Section 16 sets it as 36 times the average wage, which changes every year; check the current figure before filing.
- How the Financial Administration reads the third-state condition in Article 4(1)(a). We found no published guidance.
- The filing deadline for your return. It depends on whether you file on paper, electronically or through a tax adviser; check the Financial Administration’s current guidance.
Frequently Asked Questions
Do Czech citizens working in the UAE pay tax in the Czech Republic?
Only if they are Czech tax residents. You are resident if you have a domicile in the Czech Republic, meaning a permanent home with the intention of staying there permanently, or if you stay there at least 183 days in the calendar year.
Is my UAE salary exempt under Section 38f(4)?
No. That exemption applies only if the salary was taxed in the state where the work was done. The UAE does not tax salaries, so a Czech resident is taxed on UAE employment income in the Czech Republic.
What tax rate applies to a UAE salary for a Czech resident?
15% on the part of the tax base up to 36 times the average wage, and 23% on the part above it, under Section 16 of the Income Tax Act. There is no UAE tax to credit.
Is there a new tax treaty between the Czech Republic and the UAE?
Yes. A new treaty signed on 24 May 2023 entered into force on 29 May 2024 and applies from 1 January 2025, replacing the 1997 treaty.
What is the third-state condition in the new treaty?
Article 4(1)(a) treats a person as a UAE resident if UAE law considers them resident, but only if they are not a resident of a third state. Someone who is also resident in, for example, Spain or Slovakia is outside the UAE definition.
Do I have to keep paying Czech health insurance while I live in the UAE?
Not if you are abroad continuously for more than six months, are insured abroad and make a written declaration to your Czech insurer. You then have no right to Czech-covered care until you register again, and must show proof of your foreign insurance when you do.
What happens if I cannot prove foreign health insurance when I come back?
You must pay the Czech premiums back for the whole period as if you had not deregistered. Section 8(4) says penalties are not charged in that case.
Is Czech permanent residence registration the same as tax domicile?
No. Tax domicile under Section 2(4) is about having a permanent home with the intention of staying there permanently. Registration is evidence, but the facts about your home and plans decide it.
Official Sources
- Income Tax Act No. 586/1992 Coll. (Sections 2, 16, 22, 38f) (Czech)
- No. 206/2024 Coll., Treaty between the Czech Republic and the UAE on the Avoidance of Double Taxation, with Articles 4, 15, 22 and 28 (Czech)
- Public Health Insurance Act No. 48/1997 Coll. (Section 8(4)) (Czech)
Information current as of September 2026. Verify with official authorities before proceeding.
This guide is for informational purposes only and is not tax advice. Czech and UAE regulations are subject to change. Always verify current requirements with the relevant official authority, or a licensed tax adviser, before proceeding with any filing or transaction.
