Czech Taxes 2025–2026: Full Guide

2026 Czech Tax Updates

The Czech Republic confirmed several 2026 updates affecting freelancers (OSVČ), employees, and companies. The summary below highlights the main changes.

The increase in minimum social and health insurance deposits affects mainly freelancers (OSVČ) with lower income.

These deposits are advance payments later recalculated based on real annual income, so at the end of the year, each person either pays the balance or the minimum fixed deposits cover the final amount. Although the minimum deposits increased in 2026, the insurance rates remain the same.

Freelancers with medium or higher income are not directly affected, as their final insurance is calculated from real income, which is higher than the minimum deposits.

For higher earners, the update is partly positive because the 23 percent income tax threshold moved higher, so a larger part of income stays under the 15 percent tax rate.

The maximum social insurance base also increased, which can raise payments for the highest incomes.

Overall, the 2026 changes raise monthly costs for lower-income freelancers but slightly improve the tax position of higher-income ones.

Freelancers must pay monthly deposits for social and health insurance, even with zero income.The table below shows the updated 2026 minimum contributions, including the special rate for those in their first year of registration.

Freelancers who use the flat-tax (paušální daň) system pay one combined monthly amount that includes income tax, social insurance, and health insurance.

The table below lists the monthly rates for 2025 and 2026. Only Band 1 was adjusted; Bands 2 and 3 remain unchanged.

For employees, the main 2026 updates concern the income-tax threshold and the maximum base for social-insurance contributions.

Czech Taxes 2025: Full Guide to New Rules, Rates & Deductions

In 2025, the Czech Republic introduced significant updates to its tax laws, especially for freelancers (OSVČ), employees, and businesses. These changes affect income tax thresholds, flat tax bands, health and social insurance contributions, and eligibility for tax deductions. This complete guide breaks down all the updates, based on official information from the Czech Ministry of Finance.

Czech freelancer taxes remain in two brackets:

• 15% tax applies to income below CZK 1,676,052

• 23% applies if your taxable income exceeds CZK 1,676,052

This threshold is based on 36 times the average salary (CZK 46,557/month). It was previously based on 46×.

You can still deduct a spouse earning under CZK 68,000/year, but in 2025, there’s an added condition: The spouse must care for a child under 3 years old. This is a new rule and affects many families claiming this deduction.

The calculation base for mandatory insurance contributions has increased. In 2025, it's now 55% of your tax base, not 50%

For example, using the 60/40 flat expense method: If your gross income is CZK 1,000,000 → tax base = CZK 400,000 You now pay social and health based on 400,000 × 55%, not 50%.

Minimum deposit payments in 2025:

• Social insurance: CZK 4,759/month

• Health insurance: CZK 3,399/month Even with zero income, these minimums must be paid.

Still not mandatory, but here’s what changes:

• Rate: 2.7%

Minimum monthly payment: CZK 243. There’s still no yearly minimum as with social or health insurance.

Flat tax allows freelancers to pay one combined monthly fee (income tax + social + health). New monthly rates are:

• Band 1: CZK 8,716

• Band 2: CZK 16,745

• Band 3: CZK 27,139

These bands are based on your gross income and the type of business activity (different limits for trade, IT, etc.).

DPP ("dohoda o provedení práce") contracts are common for part-time or seasonal jobs in the Czech Republic.

What's changed in 2025:

• The 300-hour per year limit is gone

• Now, employers must monitor monthly earnings

If an employee earns over CZK 11,639/month, the employer must switch the employee to a standard employment contract

The 15% / 23% income tax brackets still apply to Czech employees. However, the threshold for the 23% rate drops:

• It now starts at CZK 139,671/month, which is 3× the average salary

• Previously, it was 4× the average salary

New in 2025: Employees must now contribute 0.6% of their gross salary as sickness insurance. Until now, only employers paid this.

Corporate income tax in the Czech Republic remains at 21% in 2025.

No change to the s.r.o. structure or corporate tax rate.

2025 sees no changes to VAT rates, after a major restructuring in 2024:

• Two rates: 12% (reduced) and 21% (standard)

• Simplified system replaced previous 10%, 15%, and 21% rates

• Some food and important goods have lower VAT

• Some services and beverages now have higher VAT

Starting with the 2024 tax year (filed in 2025), Czech companies can:

• do accounting and bookkeeping in EUR, USD, GBP, or other currencies

• File tax returns and make payments in that currency

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Common Questions About Czech Taxes in 2025

What is the freelancer income tax rate in the Czech Republic for 2025?

Freelancers with a Czech trade license (OSVČ) pay 15% up to CZK 1,676,052, and 23% on income above that.

What are the 2025 Czech flat tax bands for freelancers?

Band 1: CZK 8,716/month Band 2: CZK 16,745/month Band 3: CZK 27,139/month Each includes Czech income tax, social security, and health insurance.

Do employees pay sickness insurance in the Czech Republic in 2025?

Yes. As of 2025, employees contribute 0.6% of their gross salary as sickness insurance.

What is the 2025 change to DPP contracts in the Czech Republic?

If a DPP worker earns more than CZK 11,639/month, the employer must offer a standard employment contract.

Can Czech companies file taxes in foreign currency in 2025?

Yes. Starting with the 2024 tax year (filed in 2025), Czech companies can use EUR, USD, or GBP for accounting and tax declarations.