Since 2021, a voluntary simplified taxation regime (single flat-rate tax – paušální daň) has been available in the Czech Republic. This option is available for those whose turnover in their business activities does not exceed 1 million CZK. This rate means you will make all payments in a single transaction to the tax authority, which will then transfer the legally prescribed amounts for health and social insurance on your behalf. The legally prescribed amounts are as follows:
- Total single payment: 5,994 CZK, consisting of:
- Income tax amount: 100 CZK
- Social insurance amount: 3,267 CZK
- Health insurance amount: 2,627 CZK.
Attention! Before choosing the flat-rate tax system, check if you are eligible for public health insurance! Otherwise, the flat-rate tax is not a relevant option for you!
You can register for the flat-rate tax by:
- Submitting a registration application for the next fiscal year by January 10th.
- When registering a sole proprietorship, by filling out the registration form for the flat-rate tax.
After registering for the flat-rate tax, the entrepreneur must set up automatic payments (a standing order) for this amount from their account to the bank account of their respective tax authority. Payments must be credited to the tax authority’s account by the 20th of each month (for the previous month).
You can find the bank accounts of the tax authorities on the portal: https://www.financnisprava.cz/cs/dane/placeni-dani/bankovni-ucty-financnich-uradu