Q&A · Flat-rate tax
What is the flat-rate tax and who can use it?
The flat-rate tax is a single monthly payment that covers income tax plus social and health insurance for the self-employed. There are three bands by income up to 2 million CZK. You cannot be a VAT payer and cannot have side income over 50,000 CZK. The first-band payment for 2026 is 8,716 CZK per month.
The regime was introduced in 2021 to remove paperwork for smaller sole traders. A flat-rate taxpayer files no income tax return and no social or health insurance overviews, which saves both time and the cost of an accountant.
There are three bands. The first is for income up to 1 million CZK, the second up to 1.5 million, and the third up to 2 million, with the band also depending on the type of activity and the flat-rate expense percentage that would otherwise apply.
You join by notifying the tax office by 10 January of the year in question. If you start a trade during the year, you notify within the registration deadline for the new activity.
The main trap is losing eligibility mid-year, for example by registering for VAT or taking side income above the limit. If that happens, the whole year is assessed under the standard rules and you must file a return.