🇨🇿 Czech Republic — 2026 Freelancer & Company Tax FAQ

Answers to the questions we hear most often about freelancing and running a company in the Czech Republic: OSVČ vs. s.r.o., which tax method to pick, registration, and compliance.

Income tax

What's the sleva na poplatníka in 2026?

A flat 30,840 CZK personal tax credit, subtracted directly from your calculated income tax — not your income. It applies to real expenses and recognized expenses, but not to paušální daň or s.r.o. corporate tax.

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Real expenses

What's the effective tax rate under real expenses in 2026?

Roughly 33–43% across common zero-expense scenarios. It is usually much more expensive than recognized expenses or paušální daň, and becomes worthwhile when documented costs exceed the flat deduction available for your activity.

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What are the OSVČ health & social insurance minimums in 2026?

At least 39,664 CZK/year in health insurance and 60,056 CZK/year in social insurance, even at very low income — with a 2,350,416 CZK ceiling on social only.

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Recognized expenses

What are the four recognized expense rates in 2026?

80%, 60%, 40%, or 30% depending on your trade licence activity — most IT freelancers use the 60% rate.

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What happens above the recognized expenses cap?

Once your gross income exceeds the cap, the deduction is frozen and your effective tax rate rises.

Paušální daň (fixed payment)

What are the three paušální daň bands in 2026?

From 9,162 CZK/month up to 27,139 CZK/month.

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When do I need to opt into paušální daň?

The statutory date is 10 January, shifted to the next working day when it falls on a weekend or holiday. A newly starting OSVČ can enter when beginning the activity.

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s.r.o. company taxation

What's the s.r.o. corporate + dividend tax rate in 2026?

21% corporate tax plus 15% dividend tax — a 32.85% two-layer rate on distributed profit. If you take no salary and have no other insured status, you also need to include the ~36,288 CZK/year OBZP self-payer health insurance cost.

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Does retaining profit in the company reduce tax?

Yes — retained profit is taxed once, at 21%; the 15% dividend tax only applies once you actually withdraw it.

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Working with foreign clients

Can I keep a German client while on a Czech živnostenský list?

Yes — your trade license doesn't restrict where clients are based. What changes is VAT invoicing (reverse charge) for EU B2B services, not your eligibility to work with them.

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Contact us

If you have a specific question about freelancing or running a company in the Czech Republic, feel free to reach out to us. We offer a free initial consultation.