Question 1

What is the Czech Paušalní daň (Flat Tax) scheme for sole proprietors?

Accepted Answer

Paušalní daň is a simplified tax regime established under Section 7a of the Czech Income Taxes Act. It allows non-VAT registered entrepreneurs with annual turnover up to 2,000,000 CZK to pay personal income tax, social security, and public health insurance in a single consolidated monthly payment without filing annual tax returns or social security overviews.

Question 2

What are the three revenue tiers for Czech Paušalní daň?

Accepted Answer

Tier 1 (revenues up to 1M CZK, or up to 1.5M/2M with qualifying 80%/60% activities) has a monthly charge of 8,716 CZK. Tier 2 (revenues up to 1.5M CZK) requires 16,745 CZK per month. Tier 3 (revenues up to 2M CZK) requires 27,139 CZK per month.

Question 3

What are statutory lump-sum expenses (Výdajove paušaly)?

Accepted Answer

Entrepreneurs filing a standard tax return can claim statutory percentage deductions without saving invoices: 80% for craft and agricultural trades (cap 1.6M CZK); 60% for general trades and freelancing (cap 1.2M CZK); and 40% for independent professions, lawyers, doctors, and authors (cap 800k CZK).

Question 4

When does standard tax filing outperform Paušalní daň?

Accepted Answer

Standard filing is generally superior for sole proprietors who have dependent children (qualifying for child tax credits and refundable bonuses), large mortgage interest deductions (up to 150,000 CZK), or qualify for the 80% craft expense lump-sum on moderate revenues.

Question 5

What is the deadline to opt into Czech Paušalní daň?

Accepted Answer

The mandatory notification of entry into the flat tax regime must be submitted to the local Tax Office (Finanční uřad) by January 10 of the given tax year. Newly registered sole proprietors may opt in upon commencing business during the year.

Regime Modality	Statutory Basis	Revenue Ceilings	Tax Returns & Overviews	Credits & Mortgage Relief
Paušalní Daň Tier 1	§ 7a ZDP	Up to 1,000,000 CZK	0 Filings (Completely exempt)	None (Waived by statute)
Paušalní Daň Tier 2	§ 7a ZDP	Up to 1,500,000 CZK	0 Filings (Completely exempt)	None (Waived by statute)
Paušalní Daň Tier 3	§ 7a ZDP	Up to 2,000,000 CZK	0 Filings (Completely exempt)	None (Waived by statute)
80% Craft Lump-Sum	§ 7 odst. 7 písm. a	Up to 2,000,000 CZK (1.6M expense cap)	3 Filings (Tax + ČSSZ + ZP)	Full credits & child bonus
60% Trade Lump-Sum	§ 7 odst. 7 písm. b	Up to 2,000,000 CZK (1.2M expense cap)	3 Filings (Tax + ČSSZ + ZP)	Full credits & child bonus

Czech Self-Employed (OSVČ) Flat Tax & Expense Lump-Sum Calculator

Revenue & Activity Parameters

Detailed Regimes Comparison Ledger CZK (Kč / year)

Comparative Matrix: Czech Sole Proprietorship Tax Modalities

Engr. Muhammad Shahzad

📊 Česka sprava socialního zabezpečení (ČSSZ) & Finanční sprava Matrix