Nobody goes into business planning to be fined by the tax office. It happens anyway, and more often than you would expect: a forgotten VAT control statement, a VAT return filed a week late, a tax liability left unpaid. Each has a price. This article goes through the penalties an OSVČ — a self-employed person (sole trader) in Czechia — can run into, with the sections of law they come from and what keeps you clear of them.
1. Fine for a late tax filing (§ 250 of the Tax Code)
This is the penalty sole traders meet most often. File a tax return, a VAT control statement or any other tax filing after the statutory deadline and the fine arises automatically.
How the fine is calculated
The fine is 0.05 % of the assessed tax for each further day of delay, capped at:
- 5 % of the assessed tax
- 5 % of the assessed tax deduction
- CZK 300,000 (the absolute ceiling)
A fine for filing a personal income tax return late that does not exceed CZK 1,000 is not imposed at all (§ 250 of the Tax Code) — it is a threshold, not a minimum. A minimum fine of CZK 500 applies only if you do not file even after the tax office prompts you. And no fine arises at all if the delay stays within five working days.
Worked example
Say the tax due on your income tax return is CZK 150,000 and you file 30 days after the deadline:
Fine = 150,000 × 0.05 % × 30 = CZK 2,250
At 60 days late the fine would be CZK 4,500. Once you are 100 days or more late you hit the 5 % ceiling, which is CZK 7,500.
The five working day grace period
The law grants a tolerance period. File within five working days of the deadline and no fine is imposed. The tolerance covers filing only — not payment.
2. Interest on late payment (§ 252 of the Tax Code)
Pay the tax late and interest arises by operation of law, for every day the tax is outstanding.
How the interest is calculated
Interest on late payment equals the ČNB repo rate plus 8 percentage points per year. It runs for each day of delay from the fourth day after the due date (§ 252(2) of the Tax Code) and is not assessed if it does not exceed CZK 1,000 for the tax period.
At the two-week ČNB repo rate of 3.75 % in force from 19 June 2026, interest on late payment is 11.75 % p.a., roughly 0.032 % a day.
Worked example
Tax owed CZK 100,000, payment 60 days late, repo rate 3.75 %:
Interest = 100,000 × (3.75 % + 8 %) / 365 × 60 = approximately CZK 1,932
Interest is not assessed if it does not exceed CZK 1,000 for the tax period.
A detail worth knowing
Interest arises automatically — the tax office sends no reminder and no request for payment. A payment assessment for the interest simply turns up later. Many sole traders are caught out here, having assumed that paying the tax settled the matter.
3. Fines for the VAT control statement (§ 101h and § 101i of the VAT Act)
The VAT control statement (kontrolní hlášení) is where the penalties bite hardest. The legislator designed it as an anti-fraud instrument and backed it with fines that leave no room for discretion.
The amounts
- CZK 1,000 — you file the control statement late, but on your own initiative, without being prompted by the tax administrator
- CZK 10,000 — you file only within the substitute deadline, after the tax administrator asks you to
- CZK 30,000 — you do not file even within the substitute deadline after being asked
- CZK 50,000 — you do not file at all and thereby obstruct tax administration
These fines are imposed automatically by law; the tax office has no discretion. The CZK 1,000 fine is waived automatically once per calendar year (§ 101j of the VAT Act). For the CZK 10,000, CZK 30,000 and CZK 50,000 fines you can apply for a waiver on justifiable grounds under § 101k of the VAT Act. For individuals and quarterly payers these three fines have been halved since 2023 — CZK 5,000, CZK 15,000 and CZK 25,000.
Why it catches people out
The control statement is filed monthly, by the 25th day of the following month by legal entities, or within the deadline for the VAT return by individuals — so quarterly or monthly, depending on your tax period. Forgetting it is easier than it sounds, especially without automatic reminders.
4. Penalty on tax assessed after an inspection (§ 251 of the Tax Code)
If a tax inspection finds that you declared less tax than you owed, the difference is assessed and a penalty is charged on top automatically:
- 20 % of the additionally assessed tax where the tax is increased
- 20 % of the reduction in a tax deduction
- 1 % where a tax loss is reduced
Worked example
The tax office finds that a VAT deduction was claimed incorrectly and assesses CZK 80,000 of additional tax. The penalty is:
Penalty = 80,000 × 20 % = CZK 16,000
Interest on late payment is then added for the whole period the tax went unpaid, so the total cost of an inspection can run well above the assessment itself.
5. The penalties people forget
Failing to file the annual statements for ČSSZ and your health insurer
Every sole trader files an annual statement of income and expenses (přehled) with the Czech Social Security Administration (ČSSZ) and with their health insurer, each within one month after the deadline for filing the tax return. Filing late risks a fine of up to CZK 50,000 from ČSSZ and up to CZK 50,000 from the health insurer.
Late social security and health insurance advances
Sole traders pay monthly advances on social security and health insurance. Late payment carries a penalty of the ČNB repo rate plus 8 percentage points per year, divided by 365 for each calendar day of delay (a variable rate since 2022; at the two-week repo rate of 3.75 % in force from 19 June 2026 that is 11.75 % a year, i.e. 0.0322 % a day).
Not keeping or not retaining records
A sole trader is required to keep tax records under § 7b of the Income Tax Act, or full accounts. For failing to meet record-keeping obligations the tax office can impose a fine of up to CZK 500,000 under § 247a of the Tax Code.
Seven things that keep you out of trouble
1. Keep a tax calendar
Put every date in a calendar with alerts: the VAT return (25 days after the end of the tax period), the control statement, the income tax return (1 April on paper, 4 May electronically, 1 July if a tax adviser files for you), and the annual statements for ČSSZ and your health insurer. Taxorio includes a tax calendar that flags the dates as they approach, and you can check them against the tax deadline overview.
2. File early
Do not leave filing to the last day. A data box outage, the Financial Administration portal going down, or plain flu can all land exactly on the deadline. Aim to file three to five days ahead.
3. Pay on time and pay correctly
When paying tax, check the variable symbol and the tax office account number. A wrong variable symbol means the payment is not matched to you and the office records arrears you thought you had settled.
4. Use the XML exports
Filling in forms on the EPO portal by hand is slow and error-prone. Taxorio generates the XML files for the VAT return (DPHDP3), the VAT control statement (DPHKH1) and the personal income tax return (DPFDP7); you upload the file through your data box or the MOJE daně portal. The steps are in XML export for EPO.
5. Check your account on MOJE daně
The MOJE daně portal (adisspr.mfcr.cz) shows whether a filing was accepted and whether any arrears are recorded against you. Once a month is enough.
6. Record documents as they arrive
Do not push invoices and expenses to the end of the quarter. Recording as you go means everything is ready when the return is due and nothing is quietly missing. In Taxorio you can photograph an expense with your phone the moment you receive it and the document goes straight to the inbox for review.
7. Ask when you are unsure
If you are not certain an obligation applies to you, ask. The tax office answers questions free of charge at its filing offices. A tax adviser costs money; a fine costs more.
What to do when the fine has already arrived
If a penalty notice lands, you have options.
Waiver of tax accessories
Under § 259a to § 259c of the Tax Code you can apply for a waiver of late payment interest or of a penalty. The tax administrator can waive up to 75 % of a penalty (§ 259a) and late payment interest in full (§ 259b). The application has to be reasoned — justifiable grounds include a natural disaster, serious illness or other exceptional circumstances.
Appeal
A payment assessment for a penalty or interest can be appealed within 30 days of delivery. An appeal makes sense above all where you believe the calculation is wrong or the obligation never arose.
Deferral or an instalment plan
If you cannot pay the amount at once, § 156 of the Tax Code lets you apply for deferral of payment or for instalments. For the period of the deferral a lower interest rate applies to the deferred amount instead of late payment interest.
Summary: prevention is cheaper than the penalty
The sanctions in one view:
- Late filing — 0.05 % of the tax per day (capped at 5 % or CZK 300,000; not assessed if it does not exceed CZK 1,000)
- Late payment — repo rate plus 8 percentage points p.a.
- VAT control statement — CZK 1,000 to CZK 50,000
- Tax assessed after an inspection — 20 % of the additional assessment
- ČSSZ and health insurer statements — up to CZK 50,000 each
All of it is avoidable with the same three habits: record documents systematically, keep the deadlines, and let the software generate the filings. Order in your records costs far less than any single fine.
Taxorio scope: Taxorio provides invoicing and income/expense records for Czech sole traders. It is not full accounting or personalised tax advice. For an unsupported or unusual case, verify the treatment with a Czech accountant or tax adviser before filing.