Taxes

Taxes in Czech Republic

The Czech tax system is relatively straightforward with flat-ish rates. Freelancers enjoy particularly favorable treatment through the lump-sum expense method.

Personal Income Tax Rates (2026)

Tax Residency

You're a Czech tax resident if you:

• Have permanent residence in Czechia
• Stay 183+ days in a calendar year
• Have your center of vital interests (family, economic ties) in Czechia

Tax residents pay tax on worldwide income.

Non-residents pay tax only on Czech-source income.

For Employees

Employers withhold taxes and social contributions:

Total employee burden: ~26-34% depending on income level

For Freelancers (OSVČ)

The famous 60/40 method makes Czechia attractive for freelancers:

1. Deduct 60% of gross income as lump-sum expenses (no receipts needed)
2. Pay 15% tax only on the remaining 40%
3. Effective tax rate: Just 6% of gross income (for income under threshold)

Example: CZK 1,000,000 gross income

• Taxable base: 400,000 CZK (40%)
• Tax: 60,000 CZK (15% of base)
• Effective rate: 6%

Plus social and health contributions:

• Social security: ~29% of profit (minimum ~3,300 CZK/month)
• Health insurance: 13.5% of profit (minimum ~2,900 CZK/month)

Filing Deadlines

Tax Credits

• Basic taxpayer credit: CZK 30,840/year (for residents)
• Child tax credit: Up to CZK 15,204 per child
• Student credit: CZK 4,020 (for students under 26)
• Disability credits: Various amounts

Double Taxation

Czech Republic has tax treaties with 90+ countries. Common provisions:

• Pension income often taxed in residence country
• Employment income taxed where work is performed
• Dividends/interest may have reduced withholding

Getting Help

• Expat Tax - English-speaking tax services for expats
• PwC, Deloitte, KPMG - Big 4 firms with international tax teams
• Local tax advisors - Often 1,000-3,000 CZK for simple returns