Side income, or already running a business?

There is a widespread myth about the line between a small side income and running a trade as a business: that up to 50,000 Kč a year you simply don't need a trade licence. Unfortunately, that isn't true. The Trade Licensing Act (§ 2 of Act No. 455/1991 Coll.) defines a business as an activity carried out **regularly, independently, in one's own name, at one's own responsibility and for profit**. If you meet all of these characteristics, it counts as a trade — **regardless of the amount of income**. If, for example, you sell handmade products regularly every week at a market, you need a trade licence even if it only brings you 15,000 Kč a year. Where does the 50,000 Kč myth come from? From **§ 10(3)(a) of the Income Tax Act** (Act No. 586/1992 Coll., ZDP), which **exempts** from tax the total of occasional (incidental) income up to 50,000 Kč a year. But this provision only deals with **tax** — not with whether you need a trade authorisation (živnostenské oprávnění). These are two separate questions: - **Is the activity regular?** This decides whether you must have a trade licence (the Trade Licensing Act). - **How much did you earn?** This only decides whether you pay tax on it (the Income Tax Act). A genuinely incidental, one-off activity with no intention of repeating it does not require a trade licence, regardless of the amount. You can find the trade register at [rzp.gov.cz](https://rzp.gov.cz); an overview of three legal routes without a trade licence is in the article [when you don't need a trade licence](/provoz-zivnosti/podnikani-bez-zivnosti).

If you stay within the § 10 limit of the Income Tax Act, there is nothing to deal with — the income is **not shown** in the tax return. But as soon as the total of all your occasional income for the year exceeds **50,000 Kč**, this changes fundamentally: - **The whole amount** is taxed, not just what's over the limit — as **other income under § 10 of the Income Tax Act**, at a rate of **15 %** (23 % above an annual tax base of 1,762,812 Kč across all income combined). - You may deduct only expenses that were **actually incurred and documented** — the lump-sum expense allowance (30/40/60/80 %) does not apply to this type of income. - You must file the **tax return** yourself, even if you would otherwise rely on your employer's annual payroll reconciliation as an employee — side income over the limit does not fit into that. The deadline is **1 April 2026** on paper, or **4 May 2026** for electronic filing, for example via the [MOJE daně](https://www.financnisprava.cz) portal. - Having to file a return, however, **does not mean you are self-employed (OSVČ)**. As long as the activity is not regular, you do not need to deal with social or health insurance on the side income. If you are already self-employed (OSVČ) (say, running a secondary activity alongside employment), you pay social insurance only once your annual profit exceeds the decisive amount of **117,521 Kč**; for a main activity, the minimum advance payment in 2026 is **5,005 Kč** from 1 July (**5,720 Kč** until 30 June), and the health insurance advance is **3,306 Kč** all year round — more in the overview [main vs. secondary activity](/pojisteni-osvc/hlavni-vs-vedlejsi-cinnost). You will find the detailed schedule and forms in the overview of [OSVČ deadlines](/dane-osvc/terminy-osvc).