Freelancing in the Czech Republic as an Expat: Trade Licence, Tax and Insurance

Posted on by Jan Marek

Freelancing in the Czech Republic means registering as a self-employed person (OSVČ) with a trade licence (živnostenské oprávnění), paying income tax and paying health and social insurance. EU citizens can register directly, while non-EU citizens generally need an appropriate residence permit. Rules and minimum payments change every year, so use this guide to understand the system and confirm figures with the authorities.

Residence and Right to Work

  • EU, EEA and Swiss citizens: You can register a trade licence directly once you are in the country.
  • Non-EU citizens: The usual route is the long-term residence permit for business purposes, often called the “živno” visa. It generally requires a trade licence or proof of the intended business, proof of accommodation, health insurance and proof of funds, and is applied for at a Czech embassy. Requirements and processing times change, so check current rules with the Ministry of the Interior.
  • Digital nomads: The Czech Republic has a separate digital nomad programme. See our digital nomad guide and visa and permits guide.

Registering a Trade Licence

A trade licence is registered at any trade licensing office (živnostenský úřad) or Czech POINT branch, and many freelancers do it with the help of an accountant or online service. You need your ID or passport, a Czech address for the business and, for some trades, proof of qualification. Common freelance categories are the “free trade” (volná živnost), which covers many IT, design, marketing and consulting activities, and regulated trades, which need proof of qualifications. The administrative fee for a first trade is low, around 1,000 CZK, but check the current amount.

After registering, you must notify the tax office, the health insurer and the Czech Social Security Administration. Your trade licence office usually passes the data to the tax office, but you still need to confirm the other registrations, so ask your accountant or the offices what applies.

Income Tax

Income tax is mainly 15%, with a higher 23% rate on income above a threshold linked to the average wage. Freelancers can usually choose between deducting their actual expenses or using flat-rate expenses, which are a percentage of income that depends on the type of trade (for example, 60% for many trades and 80% for some crafts and agriculture, with annual caps). Which option is better depends on your costs, so compare both with an accountant.

Tax returns are due on 1 April, or 1 May if filed electronically, with a later deadline if a tax adviser files for you. Check the current dates each year. Tax residency affects how foreign income is taxed, as explained in our tax residency guide and tax filing guide.

Health and Social Insurance

Self-employed people pay health insurance and social insurance separately, and each is calculated from an assessment base that is a share of your profit. For health insurance, the rate is 13.5% of the assessment base. For social insurance, the main contribution is about 29.2% of its assessment base, with a part being sickness insurance that is voluntary for self-employed people. In both cases, there are minimum monthly advance payments that apply even if your profit is low, and they are updated every year, so check the current minimums with your insurer and the Social Security Administration.

You file annual overviews with the health insurer and the Social Security Administration after your tax return, and your payments are adjusted. If you work part-time as a freelancer while employed, you may fall under the “secondary activity” rules, which have different minimums and thresholds. See our healthcare guide for how public insurance works for foreigners.

VAT

You must register for VAT if your turnover over 12 consecutive months exceeds the legal threshold, which is currently 2 million CZK, and the deadline for registering is short, so monitor your turnover as you approach it. You can also register voluntarily, which can make sense if your clients are VAT-registered businesses. If you invoice clients in other EU countries, special EU rules apply and you may need to register as an identified person. Check the current thresholds and rules with the tax office or an accountant.

Working With Clients

Freelancers usually work under a contract for services or a contract for work, and send invoices. Keep your invoices and receipts, as you will need them for your tax return and your records. Many expats work for clients abroad, often in IT, design, writing and marketing, but the tax and VAT treatment depends on where the client is based and where you live, so confirm with an accountant. A bilingual accountant is a worthwhile cost for a first year.

Practical Tips

  • Open a Czech business or personal bank account. See our banking guide.
  • Set aside money for tax and insurance from every payment.
  • Ask an accountant to review your first year of registration and tax return.
  • Keep track of insurance minimums and thresholds, as they change each year.
  • Think about the difference between freelancing and a job. See our jobs guide.

Frequently Asked Questions

What taxes do freelancers pay in the Czech Republic?

Income tax, mainly at 15%, plus health and social insurance contributions, and VAT if you exceed the threshold or register voluntarily.

Can non-EU citizens freelance in the Czech Republic?

Yes, but they generally need a business-purpose residence permit or another permit that allows self-employment before they register. The rules and requirements change, so check with the Ministry of the Interior.

Do I need an accountant?

It is not required, but most expats use one in the first years because of the Czech-language forms and the many deadlines.

See the Expat and Nomad hub for more.