Flat-rate tax for the self-employed (OSVČ)

What flat-rate tax is

Flat-rate tax (paušální daň) is a simplified tax regime for the self-employed (OSVČ), introduced from 1 January 2021 (§ 2a and § 38la et seq. ZDP). Instead of separately filing a DPFO income tax return and statements for the ČSSZ and your health insurer, you pay a single monthly flat-rate payment that bundles together:

• Personal income tax advances.
• The advance on social insurance — pension insurance and the contribution to the state employment policy.
• The advance on health insurance.

After the year ends, there's normally no shortfall or overpayment — the flat-rate payment is treated as final, as long as you meet the conditions for staying in the regime. The exception is a retroactive change in the law: amendment No. 90/2026 Sb. reduced the Band I payment retroactively from January 2026, so an overpayment of CZK 4,932 arose for the first half of 2026 (see below).

Who can enter the flat-rate regime

Flat-rate tax is for a self-employed person who meets all of these conditions:

• Annual income from self-employment did not exceed CZK 2,000,000.
• Isn't a VAT payer. You can be an identified person — § 2a odst. 1 ZDP explicitly excludes identified-person registration from the condition "has no duty to register for VAT." Taxorio allows this combination. A VAT payer can't enter the regime; if you register for VAT while already in it, you stay in it until the end of the year (see below).
• Isn't a partner in a general commercial partnership, or a general partner in a limited partnership.
• Has no income from employment (except income exempt from tax or taxed by withholding tax).

The flat-rate payment amount for 2026

The flat-rate payment depends on the level of your income and on which expense flat rate you'd use in the standard regime. The band is set as the lowest one you fit into:

• Band I — CZK 9,162/month (the statutory liability for 2026 totals CZK 109,944; from January–June you originally paid CZK 9,984, creating an overpayment of CZK 4,932):
  • Income up to CZK 1,000,000 — applies to all types of activity (30/40/60/80% flat rate)
  • Income up to CZK 1,500,000 — applies to the 60% and 80% expense flat rate (trades, crafts)
  • Income up to CZK 2,000,000 — applies only to the 80% expense flat rate (craft trades, agriculture)
• Band II — CZK 16,745/month (CZK 200,940 a year):
  • Income from CZK 1,000,001 to CZK 1,500,000 (30/40% flat rate), or up to CZK 2,000,000 (60/80% flat rate), if you don't fall into Band I
• Band III — CZK 27,139/month (CZK 325,668 a year):
  • Income from CZK 1,500,001 to CZK 2,000,000 — if you don't fall into Band I or Band II

The exact amounts for each year are announced by the Financial Administration. Always check the current figures at financnisprava.cz.

How to set up flat-rate tax in Taxorio

1. Go to Settings → Tax regime.
2. Choose Flat-rate tax. (If you're a VAT payer, the app first sends you to change your VAT status in Company details — it won't switch it for you.)
3. Choose the band (Band I / II / III) based on your estimated annual income, and the year you enter the flat-rate regime. The breakdown of the advance into tax, social and health insurance is calculated based on the year too.
4. Click Start activation wizard — Taxorio walks you through the rest and saves the settings only at the end. It then adapts the tax calendar (monthly advances due on the 20th, instead of social/health insurance advances and return deadlines) and, instead of an income tax return, offers only Income records with an income book in case of an audit.

The band's decisive income counts paid documents by their payment date; a foreign-currency invoice counts at the amount that actually arrived, converted at the CNB rate on the day of payment — the same as in the income book.

Returning to the standard regime

You can leave the regime voluntarily by notifying the tax office by 10 January of the year from which you no longer want to be in it. The regime also ends in other ways — for example when you exceed your band's income limit, become a VAT payer or exceed the VAT registration turnover; you report such a fact within 15 days. Taxorio doesn't file these notifications for you.

1. Once your last year in the regime is over, open Settings → Tax regime and choose Standard.
2. Pick the last year settled by the flat-rate tax (last year by default). For that year and the years before it since you entered the regime, Taxorio doesn't offer a return or statements — the Income tax card shows just the income records.
3. A year in which you breached the regime's conditions (band income exceeded, VAT registration) is not settled by the flat-rate tax — don't pick it, you file a return and statements for it. The flat-rate advances you paid are credited against tax and insurance; Taxorio doesn't fill them in, add them to the return and statements as paid advances.

You can correct the last year in the regime later in the same tab.

Registering for VAT during the year: set VAT payer in Company details straight away — from the registration date you issue invoices with VAT and file VAT returns. You pay the flat-rate advances until December. In January switch to the standard regime; Taxorio pre-fills the year before registration as the last settled year.

Turnover over CZK 2,000,000: you become a VAT payer only from 1 January of the next year, but your flat-rate regime ends at the end of the year in which you exceeded the turnover — the duty to register arises on the day you cross it. You pay the flat-rate advances until December and file the income tax return and insurance statements for that year. In January set VAT payer from 1 Jan in Company details and switch to the standard regime; Taxorio handles the rest.

What Taxorio can't do: if you stay in the regime but in some year had employment income or other income over CZK 50,000, the tax for that year is not equal to the flat-rate tax and you file a return and statements. Taxorio doesn't generate that return — file it in EPO.

Advantages and disadvantages compared with actual expenses

• Advantages: Minimal paperwork — no DPFO return, no statements for the insurers. One payment instead of three. Certainty — you know exactly how much you'll pay.
• Disadvantages: You can't claim tax deductions (mortgage, pension contributions, donations). You can't be a VAT payer. If your actual tax liability works out lower than the flat rate, you overpay.