A practical guide to trade licences, self-employment and business in Czechia

OSVČ taxes

OSVČ taxes in 2026

As a trade licence holder, you choose how to tax your income: with a single monthly flat-rate tax, or with a tax return using a lump-sum expense allowance or actual expenses. Here you will find a guide to all the options.

flat-rate band 1: 9 984 Kč/month from 7/2026 approx. 9 162 Kč/month tax 15 % / 23 % DPH (VAT) from turnover of 2 mil. Kč
Flat-rate tax Lump-sum expense allowances

Three ways to tax your income

Flat-rate tax

one monthly payment

Suits: childless self-employed people (OSVČ) with low expenses and income up to 2 mil. Kč, who do not want to deal with a tax return or tax credits.

Flat-rate tax 2026

Lump-sum expense allowances

tax return without receipts

Suits: those whose actual expenses are lower than the allowance and who want to claim tax credits and the child tax bonus.

Lump-sum expense allowances 80/60/40/30 %

Actual expenses

based on bookkeeping

Suits: those with high provable costs (goods, materials, employees), where the allowance is not sufficient.

OSVČ tax return

Flat-rate tax bands 2026

BandMonthly amountAnnual income limit
Band 19 984 Kčup to 1 000 000 Kč (up to 2 mil. Kč for craft trades with the 80 % allowance)
Band 216 745 Kčup to 1 500 000 Kč (up to 2 mil. Kč for activities with the 80/60 % allowance)
Band 327 139 Kčup to 2 000 000 Kč

The monthly amount covers income tax as well as social and health insurance contributions, payable by the 20th day of the month. Note: in connection with the reduction of the minimum social insurance advance payments for OSVČ (40 % → 35 % of the average wage), the social component of band 1 is reduced during 2026 from 9 984 Kč to approximately 9 162 Kč/month, with a refund of the overpayment for the first months. Always verify the specific amount and date with the Tax Administration (Finanční správa). Source: Finanční správa, ČSSZ (Czech Social Security Administration), MF ČR — verified 2026.

Key OSVČ tax topics

Flat-rate tax

One monthly amount instead of tax and both insurance contributions. Three bands and a limit of 2 mil. Kč. No tax return or income and expenses statements.

Lump-sum expense allowances

Expenses as a percentage of income: 80 % craft trades, 60 % unqualified trade, 40 % liberal professions, 30 % rental. No documentation required.

OSVČ tax return

For 2025 you file in 2026. OSVČ with a data box (datová schránka) must file electronically by 4 May 2026. Tax rates of 15 % and 23 %.

DPH (VAT) and the identified person

You become a VAT payer when your turnover exceeds 2 mil. Kč. Advertising on Google or Meta makes you an identified person.

Tax credits

Taxpayer credit of 30 840 Kč, credits for children and for a spouse. They cannot be claimed under the flat-rate regime.

2026 amendment: the band 1 flat-rate amount is reduced during the year

In 2026, the minimum social insurance advance payments for OSVČ revert from 40 % back to 35 % of the average wage. Together with them, the social component of band 1 of the flat-rate tax also falls — from 9 984 Kč to approximately 9 162 Kč/month from July 2026, with a refund of the overpayment for the first months. Always verify the specific amount and date with the Tax Administration (Finanční správa). Source: MF ČR (press release 26 May 2026), ČSSZ — verified 2026.

Frequently asked questions

How much is the flat-rate tax in 2026?
In band 1 it is 9 984 Kč per month, in band 2 it is 16 745 Kč, and in band 3 it is 27 139 Kč. However, due to the reduction of social insurance advance payments, the social component of band 1 drops from July 2026 to approximately 9 162 Kč — verify the current amount with the Tax Administration (Finanční správa).
Does the flat-rate tax or the lump-sum expense allowance pay off?
The flat-rate tax suits childless self-employed people (OSVČ) with low expenses and no entitlement to tax credits and deductions. The lump-sum expense allowance in a regular tax return is usually more advantageous for families with children (child tax bonus) or when claiming tax credits and the deduction of mortgage interest. Calculate both options.
From what level of income do I pay the 23 % tax rate?
The 23 % rate applies only to the part of the tax base above 1 762 812 Kč per year (36 times the average wage). The first 1 762 812 Kč is always taxed at 15 %.
When does an OSVČ become a VAT payer?
When your turnover exceeds 2 000 000 Kč in a calendar year; you must submit the registration application within 10 working days. If the second threshold of 2 536 500 Kč is exceeded, you become a VAT payer by operation of law on the second day after the threshold is crossed.
Do I have to file a tax return under the flat-rate regime?
No. If you meet the conditions and do not exceed the band limit, you do not file a tax return or income and expenses statements for ČSSZ (Czech Social Security Administration) and your health insurance company. Everything is covered by one monthly payment.

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Not sure what pays off for you?

Compare the flat-rate tax, the lump-sum expense allowance and actual expenses using our tools and calculators for the self-employed (OSVČ).

Tools and calculators