A Czech lease agreement contains three different payments that look similar and work in completely different ways: the deposit, advance payments for services, and energy. Each has its own rules, its own recipient, and its own fate at the end of the tenancy. Here is the overview worth going through before you sign.
Rent is only one line item
The listing shows one number, the contract has several. A model 2+kk rental in Prague can look like this:
| Item | Amount | How often |
|---|---|---|
| Rent | CZK 15,000 | monthly |
| Advance payments for services | CZK 3,500 | monthly |
| Energy | CZK 1,800 | monthly |
| Deposit | CZK 30,000 | once, on signing |
Illustrative figures. What matters is that on signing you pay considerably more than one month of rent, and that only one of these amounts comes back to you at the end.
The deposit: the law calls it a security
How high it may be
The deposit is governed by Section 2254 of the Civil Code. The security together with any contractual penalty may not exceed three times the monthly rent (wording of the section). This cap has applied since an amendment effective 28 February 2017; before that the limit was six times the rent.
The cap is calculated from net rent, not from advance payments for services or energy. With rent of CZK 15,000 and advances of CZK 3,500, the maximum is therefore CZK 45,000, not CZK 55,500. Anything agreed above that limit is treated as apparent, meaning as if it had never been agreed (interpretation by the Czech Tenants Association).
What may be deducted from it
The security covers what the tenant owes from the tenancy: unpaid rent, an underpayment from the settlement of services, damage beyond ordinary wear and tear. Ordinary wear and tear, such as a worn carpet or a faded wall after four years of living there, does not count.
The two things people get wrong most often:
- The deposit is not a prepaid last month of rent. Stopping payments for the final months on the assumption that it will be taken out of the deposit is not acceptable. The landlord may satisfy claims from it only once the tenancy ends.
- Any retained part has to be documented. If the landlord keeps part of the deposit, the statement should make clear how much was kept and why.
Interest on the security
The law gives the tenant the right to interest on the security from the moment it is paid, at least at the statutory rate. The catch is that no regulation actually sets that rate for a security, and interpretations differ. The safest approach is to write both the rate and the calculation method directly into the contract, so it is not up for debate when the tenancy ends.
Services: advances settled once a year
What counts as services
Services are defined in Section 3 of Act No. 67/2013 Coll. The list is illustrative; the exact scope is agreed in the contract:
- heat supply and centrally provided hot water,
- water supply and waste water disposal,
- lift operation,
- lighting and cleaning of common areas in the building,
- removal of waste water and cleaning of cesspits,
- enabling reception of radio and television signal,
- operation and cleaning of chimneys,
- municipal waste collection.
The full text of the act is available on the website of the Ministry for Regional Development.
You pay an advance, not the final price
The monthly amount for services is an advance estimated from previous years of consumption and expected prices. Actual costs are added up after the end of the accounting period, usually the calendar year, and settled against the advances. The result is either an overpayment or an underpayment.
Deadlines set by law
| What | Deadline |
|---|---|
| Delivery of the settlement to the tenant | within 4 months of the end of the accounting period, so by 30 April for a calendar year |
| Payment of the overpayment or underpayment | within 4 months of delivery of the settlement |
| Tenant's objections to the settlement | within 30 days of delivery |
| Landlord's handling of the objections | within 30 days of their submission |
| Producing cost records on the tenant's request | within 5 months of the end of the accounting period |
If the landlord misses the deadlines, the tenant is entitled to a penalty of CZK 50 for each day of delay commenced, unless the parties agreed on a lower amount (Section 13 of Act No. 67/2013 Coll.). The Supreme Court has repeatedly confirmed that the claim also arises when the settlement arrives on time but is not proper (case law overview on epravo.cz). The same penalty applies to the tenant as well, typically for failing to report a change in the number of people living in the flat.
Energy: electricity and gas
The contract is usually in the tenant's name
For electricity and gas, the tenant in most cases has their own contract with the supplier. Advances and the annual settlement then come from the supplier, not from the landlord, and the landlord has no visibility into them. Two contracts cannot exist for one supply point at the same time, so moving in means a transfer of the supply point, not a transfer of the old contract.
The transfer usually requires the supply point number (EAN for electricity, EIC for gas), proof of identity, the lease agreement, and a handover protocol with meter readings (procedure at E.ON, procedure at MND).
Five seconds that prevent most disputes
When taking over the flat, photograph the electricity meter, the gas meter and the water meters, and write the readings into a handover protocol signed by both sides. It is the cheapest piece of evidence you will ever have. According to the dTest consumer advice service, suppliers sometimes bill the same period to both the old and the new customer, and without agreed readings that is hard to challenge.
Watch out for heating
Heat from a building boiler room or a central source is not energy in this sense but a service under Act No. 67/2013 Coll. You pay an advance for it to the landlord and it is settled once a year. Your own supplier contract typically covers electricity only, plus gas if you heat or cook with it.
There is also a variant where the energy contract stays in the landlord's name and the landlord recharges the cost to the tenant as another agreed service. In that case the same rules on advances and settlement apply as for services. The contract has to make clear which variant is in force.
Quick comparison
| Deposit | Services | Energy | |
|---|---|---|---|
| What it is | refundable security | advances for running the building | consumption of the flat |
| Who you pay | the landlord | the landlord | the supplier, usually directly |
| Refundable | yes, after the tenancy ends | only an overpayment from the settlement | only an overpayment from the settlement |
| When it is settled | at the end of the tenancy | within 4 months of the end of the period | per the supplier contract |
| Governed by | Section 2254 of the Civil Code | Act No. 67/2013 Coll. | the supplier contract |
What to ask before signing
- Is the figure in the listing the rent, or rent including advances? The difference is often several thousand crowns a month.
- Which services do the advances cover, and at what level? So you know what to expect from the April settlement.
- Whose name is on the electricity and gas contract? And if it is the landlord's, exactly how the cost is recharged.
- How high is the deposit and how is it credited with interest? The cap is three times the net rent.
- Does the handover include a protocol with meter readings? If the landlord does not have one, bring your own.
Five questions, a few minutes. Most later disputes about deposits and settlements start exactly where nobody asked them.
Renting out a flat and still preparing the listing? On Lovec-Realit.cz you can post it for CZK 0.
