JMHZ: financial administration responds to ambiguities and practical questions

The Single Monthly Employer Reporting (Jednotné měsíční hlášení zaměstnavatele, JMHZ), which is to launch on 1 April 2026, fundamentally changes the way the data on employees’ income, mandatory contributions and other details is submitted to the tax authorities and other institutions. In light of the approaching launch date, the financial administration has issued a communication addressing related ambiguities and practical questions.

The Financial Administration’s Communication of 9 March 2026 concerns the reporting of certain exempt income from dependent activity. Under the Income Tax Act, exempt income from dependent activity (employment) is recorded on payroll sheets and is therefore part of the JMHZ. In practice, however, situations arise where exempt income is provided to a person who does not have an employment relationship with the company and has no other income from dependent activity with that company in the given month.

This mainly includes the following types of exempt income:

• income of pupils and students / apprentices from practical training,
• remuneration of members of local electoral commissions,
• benefits for former employees provided by an employer operating public transport,
• income arising from former employees’ participation in social events organised by their former employer,
• meals provided to former employees who have retired on old-age or disability pensions.
   

To ensure that employers are not unduly burdened by reporting this type of income, an amendment to the Act on JMHZ has been initiated, with a proposed effective date of 1 January 2027. In view of this expected legislative change, the financial administration has already indicated that such data will not have to be reported under the JMHZ already for 2026.

The Financial Administration’s Communication of 6 March 2026 sets out the procedure for submitting the results of the year-end settlement of employment tax prepayments and tax credits under the JMHZ system. This information is essential for the correct calculation and self-assessment of tax on income from employment by the taxpayer.

With the introduction of the JMHZ system, the financial administration will allow the application of transitional arrangements for the reporting of the year-end settlement of employment tax prepayments for 2025:

• It will not require the reporting of year-end settlement for employees whose employment ended in 2025 and who are not registered in the JMHZ system.
   
• For employees registered in the system, the year-end settlement results for 2025 will not be a mandatory part of the monthly report (although employers may report them voluntarily).

The above transitional arrangements do not affect the employer’s obligation to carry out the year-end tax settlement itself, provided the statutory conditions are met.

The financial administration further stated that it will accept the absence of data in the monthly report for January 2026 regarding taxpayers’ income for 2025 paid before 31 January 2026. The communication also lists other data that need not be reported for 2025.