LIVING IN THE CZECH REPUBLIC

Daily life and people

Boasting a sense of humour and down-to-earth mentality, the Czech people are diligent and open-minded. As with most Eastern European countries, family is central to daily life, which has resulted from many generations of cohabitation.

What may come as a bit of a shock is the Czech daily schedule. ‘The early bird catches the worm’ is a popular proverb among the Czechs, and many people get up at six and start work at seven. However, the working day does accommodate this, with people generally finishing work between 4pm and 5pm.

The man to blame for this is Austro-Hungarian Emperor Franz Josef I. Ruling from 1848 until 1916, Franz Josef was an early starter and held audiences around 6am or 7am. This habit trickled down into the populous and has become the daily routine ever since. Some are beginning to question the logic of starting work when most Europeans are still in bed, but many still choose to stick to the old routine – so don’t forget your alarm clock!

Socialising also differs. The night starts early, at 6pm and most people go home around 11pm, so if you want to socialize with the Czechs you’ll have to adapt to this schedule. As with everything, things are slowly beginning to change as a more western lifestyle is adopted by the younger generation.

Business hours:

• Offices: 8am to 4pm, Monday to Friday.
• Banks: 8am to 6pm, Monday to Friday. Some close early on Fridays.
• Shops: 8am/9am to 5pm/6pm, Monday to Friday, plus Saturday mornings.
• Shopping centres: 8am to 10pm, seven days a week.

Visas and residency

British citizens don’t need a visa to gain entry to the Czech Republic and are permitted to stay up to 180 days without one. However, your passport must be valid for at least six months before entry and not due to expire during your stay.

EU citizens may apply for a temporary residence permit to allow them to stay in the Czech Republic, and will need to do so if they intend to stay longer than three months. Although a residency permit is not a mandatory requirement for EU citizens looking to live and work here, it is recommended that you acquire one, especially as it makes the purchasing process so much easier and allows you to purchase as an individual.

In order to secure a permit, you’ll be required to produce a copy of your passport, two passport photographs, a document certifying the purpose of your stay, a health insurance policy, an accommodation contract and a sworn statement that you won’t claim social benefits during your stay unless you are in the country on business or are actively employed there. The application process could take as long as six months if you apply from a UK embassy, but this time can be halved if you apply at a foreign police office in the Czech Republic.

Following a period of temporary residency, you’re entitled to apply for permanent residency, provided you can demonstrate that you intend to seek employment in the country.

Utilities

The country is currently in the process of privatising the banking, energy and telecom sectors. Whether or not you have to pay your utility bills directly depends on your rental agreement. Those who own a property will obviously be faced with connecting supplies and paying for them, but if you rent then your rental agreement may have a utilities fee included in the price, in which case your landlord will handle payments.

Setting up your utilities is something that should ideally be done before you move into your property, as it can take days–and in some cases weeks–to get connected. To connect to gas and electricity, it’s necessary to register with the regional distributor. The following documents will be required to start an account:

• Personal identification, or power of attorney.
• If you’re renting, the written consent of the owner of your property.
• Proof of your right to inhabit the property, i.e. your rental or sale contract.
• Your bank information.

With gas and electricity, the government sets the price for household consumption and payments consist of regular deposits (záloha) which are paid every month. These are based on the size of your home and number of inhabitants. Quarterly statements will then be provided detailing the rate of gas/electric consumption and if more payments are required. If the bill has been overpaid then the surplus payments will be subtracted from the next bill.

As for water and sewage, property owners need to register with the relevant local water and sewage company for their district.

If you intend to live in Prague, www.spoluproprahu.cz offers comprehensive advice and information about setting up your utilities and paying the bills. If you ever suspect there is a gas leak, call 1239 straight away.

Banking and currency

The Czech currency is the Czech koruna (CZK), which has been in use since February 8th 1993, when Czechoslovakia was dissolved. It comes in denominations of 50 haléř, 1, 2, 5, 10, 20, 50 CKZ coins and 50, 100, 200, 500, 1,000, 2,000, 5,000 CKZ banknotes.

Opening a bank account is a fairly simple process which requires the production of a passport and one other form of ID. In some cases you may also need to produce proof of address.

A deposit will also be required in order to create an account, although this isn’t much, varying between 200 and 2,000 CKZ (£4 and £48).

There are a number of good banks and many international branches to choose from, especially in Prague. One of the biggest banks is Ceska Sporitelna (www.csas.cz) which has a centre specifically for expats. Although bank charges can be hefty they vary from bank to bank. Others include Zivnostenska Banka (www1.zivnobanka.cz) whose bank charges are extremely low, as are HVB’s (www.hvb.cz). To get more detailed information, see www.expats.cz/prague/article/money/bank-comparisons.

Always try to open an account which offers you telephone or internet banking as this will make it easier to manage payments and transfers, especially if you have a limited grasp of Czech. Ask your bank to issue you a platební karta (payment card), which is similar to a debit card. Cash is generally the best way to pay for things in restaurants and shops, although some places are happy to arrange for payment by card. ATMs are located throughout the country.

Taxes

In order to ascertain how much income tax you pay, the first thing to establish is whether or not you are classed as a resident for tax purposes. You will be classed as a resident if you reside in the country for 183 days or more per calendar year. If you do, you will be charged on your worldwide income; if not, then you are only taxed on income generated in the Czech Republic. As the UK has a double taxation treaty with the Czech Republic, this means you will not be taxed twice on income earned in the Czech Republic. However, always secure the assistance of a tax expert when trying to assess your tax situation.

Income tax is charged at a progressive rate:

Tax Base (CZK)	Tax
0 to 121,200	12%
121,201 to 218,400	19% of base exceeding 121,200 (£2,938 to £5,294)
218,401 to 331,200	25% of base exceeding 218,400 (£5,290 to £8,022)
331,201 and over	32% of base exceeding 331,200 (£8,022+)

Corporation tax is charged at a rate of 24% and is levied against Czech businesses and corporations. Capital gains are taxed as income for both companies and individuals at a rate of between 12% and 32%, as with income tax. However, if you have purchased as an SRO then you will instead be charged at the flat rate of corporation tax at 24%.

If you buy as an individual and hold the property for more than five years, you will not pay capital gains on the sale of the property.

Insurance

It’s always recommended that you get health insurance in the Czech Republic. VZP (www.vzp.cz) is the largest provider of general health insurance and their partner company, Pojistovna VZP (www.pvzp.cz), provides health insurance specifically for foreigners.

As for house insurance, those living in rented accommodation will still need contents insurance, even though security issues are taken care of by your landlord. It is possible to have the contents of your property insured from the UK by companies such as John Wason Insurance Brokers (www.johnwason.co.uk). Alternatively, there are Czech firms such as Insia (www.insia.cz), who will insure your house, contents and car.

Bringing or owning your own car in the Czech Republic can involve a lot of paperwork, and if you wish to obtain long-term insurance, the car must be registered and its owner must have third party liability insurance – as in the UK – known locally as povinné ručení. Full cover is not essential, but is the safest option.

Healthcare

The standard of health care in the Czech Republic does vary, and it should come as no surprise that Prague offers some excellent facilities. As a resident of the EU, British citizens are entitled to the same standard and conditions of health care as the Czechs. However, you must ensure that you carry an EHIC (European Health Insurance Card) in order secure any medical treatment required, and as payment may be necessary, it’s also strongly recommended that you secure private health insurance.

EU nationals living in the Czech Republic who enjoy temporary residence (přechodný pobyt) have similar rights to Czechs, because of the principle of common healthcare provision across the European Union. If you are employed by a Czech firm, then payments will be made from your salary directly to a public health insurance company. If you are self employed then you will need to set up health insurance. Once you are registered, you will be issued with a health card by your insurance company, which should be kept with you at all times.

Retirement

As the Czech Republic is part of the European Economic Area (EEA), you could well be eligible for certain benefits. Those employed by a Czech company will pay social security contributions from their salary which will entitle them to various benefits. These payments, coupled with healthcare contributions, amount to 12.5%.

As a UK citizen living in the Czech Republic, you will be entitled to your UK pension, which can be paid into your UK bank account and then transferred to the Czech Republic. Thanks to the double taxation treaty, you shouldn’t be taxed on your pension in the Czech Republic if it’s taxed in the UK.

If you own assets in the Czech Republic, such as your property, it is recommended that you write a Czech will to avoid any discrepancy over inheritance should you die.

Education

If granted temporary or permanent residency, or even short-term residency for up 90 days, foreigners are entitled to study in Czech schools at either primary, secondary or higher vocational level.

As would be expected, outside of Prague there are few international schools, so the only option may be to send your children to a Czech-speaking school.

Brno has a good international university and business school, offering a degree course in medicine in English as well as numerous electronic and economic degrees. The foreign student population in Prague is significant and in Brno it’s estimated at well over a thousand, making both markets good for buy-to-let investors. The total student population in the Czech Republic is well over 20,000.

• British International School of Prague, www.bisp.cz
• The English College in Prague, www.englishcollege.cz
• Riverside School Prague, www.riversideschool.cz
• The International School of Prague, www.isp.cz
• The International School of Olomouc (TISOL), www.tisol.cz

Driving

Unfortunately, the Czech Republic has one of the highest rates of traffic accidents in central Europe. You’re required to hold a valid EU driving licence which can be used throughout the EU, but foreign drivers must be at least 18 years old and at least 21 in order to rent a car. A certificate of insurance, or ‘Green Card’, is also necessary and this is valid for three months and indicates that you have comprehensive insurance coverage.

The Czech Republic employs a zero tolerance policy towards alcoholic consumption when driving and a law brought in during July 2006 states that drivers must have their headlights switched on at all times.

Speed limits are as follows:

• motorways: 130km/h (80mph);
• main highways: 90km/h (55mph);
• built-up areas: 50km/h (31mph).

The maximum speed for motorcycles is 90 km/hr.

In order to drive on the motorway you will have to pay, but as there are no toll booths you’ll need to buy a window sticker. For a year’s sticker, it costs from 900 CKZ (£22).

In terms of fuel, petrol and diesel are readily available throughout the country.

Getting around

Buses are the best means of getting around and, as well as being cheaper than trains, they are also quicker and less likely to be delayed. Most major cities are linked by buses (Prague, Brno, Plzeň and Liberec), while there are also domestic flights in operation by CSA Czech Airlines (www.czechairlines.com) between Prague, Brno and Ostrava. The IDOS website is an excellent resource for information on travelling around the country (www.idos.cz).

The trains, while temperamental, do serve every corner of the country and, unlike the buses, they also operate regularly during off-peak hours. However, outside of the main routes, the standard of travel does decline, with trains dating back to the 1970s and journeys being very time-consuming, especially if you’re trying to reach provincial towns or villages. Train stations can be very old fashioned and prices for tickets vary depending on which type of train you decide to take.

As the main tourist centre, Prague offers an excellent public transport network, and the cheapest and easiest way to travel around the capital is by tram. For more details visit www.czech.cz, which is an excellent resource.

Learning the language

If you’re going to be relocating or living in the Czech Republic for any length of time then you need to get a grasp of the language. Czech – or Česky – is the official language of the Czech Republic and is one of the West Slavic languages. There are over 12 million native speakers worldwide. Although it is unlikely that you’ll become fluent, your efforts at attempting the language will be appreciated by the Czech people.

While pronounciation may seem impossible, Czech is very much said as it is written and few letters are silent within a word.

Shopping

In Prague there is no shortage of stores and shops and you can find a number of foreign goods. Outside of Prague, while awareness of the consumer market is growing and the choice of products widening, customer service can leave a lot to desired, so be prepared. Shops are generally open from 8am/9am to 5pm/6pm, Monday to Friday, plus Saturday mornings, while shopping centres are open from 8am to 10pm, seven days a week. Expect shops to close in the middle of the day for lunch.

Post

Generally labelled as slow and unreliable, things are improving and the postal service can be effective. However, it can be a little daunting to navigate your way around a Czech post office. As with the UK, they do a great deal more than just send letters, offering services such as the payment of utility bills and donations to charity. When paying a bill or sending a parcel, you will be required to fill out a rather complicated form, so it’s best to take a Czech speaker with you as few postal workers speak English. Be aware that in smaller towns the post offices close early.

Crime, corruption and the police

If you need to reach the police in emergency, dial 158. Per capita, the crime rate stands at 6.16 per 1,000 people, making the Czech Republic a fairly average country in terms of criminal offences.

Corruption is a big problem in the Czech Republic and while it is on the decline, the country is still one of the worst in the EU. The average home buyer probably won’t feel the effects of this unless they try to secure a renovation permit or deal with municipal offices; this seems to be where the corruption mainly lies. In many cases, you may well be faced with an official who wants a bribe and will make life difficult for you until it is received.

Foreigners may also suffer for being foreign — that is, be charged higher prices for a property and goods simply because they are not a Czech. In one instance, a buyer was quoted 30 million CZK (£728,305) for a castle that was for sale, when it was only actually listed at 3 million CZK (£72,778). Be aware that inflated prices for foreigners is a common problem in the Czech Republic .

While judges insist there is very little corruption within the courts, taking a dispute to court is usually a three-year process, although this is something that is supposed to be improving thanks to EU pressure.