On January 1, 2025, a change took effect regarding the non-forfeitable amounts that must be retained from wages by debtors affected by garnishment. This amendment makes several significant changes that will affect the calculation of the uncollectible amount and the deduction from wages.
What's changing?
- Increase in uncollectible amountsA: The amount to be forfeited is increased by raising the standard cost of living from CZK 14,197 to 14.680 CZK.
- Abolition of the consideration of the spouse as a dependentA: The only exception is if the obligor or the obligor's spouse (or partner) receives a pension. This must be documented to the paymaster. The paymaster does not need to be provided with proof of the pension if the paymaster himself finds out about the pension ex officio.
The new calculation of the amount to be forfeited will be based on the individual's minimum subsistence amount and the amount of the standard cost of living for one or two people as at 1 January of the year in question. This means that the calculation of the non-taxable amounts will not be adjusted during the year, even if there are changes to the minimum subsistence level.
We remind you that from 1 October 2024 New rules for enforcement deductions for persons with four or more foreclosures. The aim of these adjustments is not only to reflect the rising cost of obligors' housing, but also to facilitate the return of some of the money back to creditors. The changes to the calculation for four or more foreclosures are intended to encourage debtors who have so far found it worthwhile to remain in foreclosure for a long time to enter into debt settlement.
Conclusion
The new regulations will also apply to enforcement and execution proceedings initiated before the effective date of the Government Decree. We recommend that you familiarise yourself with these changes as they may have a significant impact on your finances.
Mgr. Ing. Markéta Skočná, LL.M., attorney at law
