Flat-rate tax for the self-employed in 2026: Is it worth it?

The flat-rate tax has become a popular choice for many self-employed people (OSVČ) who want to simplify administration and save time on paperwork.

In 2026 the regime continues, but with parameters adjusted to the current economic situation. Let’s see whether the flat-rate tax in 2026 is worth it for you.

What is the flat-rate tax and who is it for?

The flat-rate tax is a single monthly payment that includes three contributions:

1. Income tax
2. Social insurance
3. Health insurance

Thanks to this regime, OSVČ do not have to file a tax return or insurance overviews. You just set a standing order and take care of nothing else.

The flat-rate regime is voluntary and intended for OSVČ with annual income up to 2 million CZK who are not VAT payers.

Three flat-rate tax bands for 2026

The monthly flat-rate advance depends on the band you fall into based on your income and type of business (expense allowance).

1. First band

For OSVČ with income up to 1 million CZK (or up to 1.5 million CZK for craft trades with an 80% expense allowance). This is the most common option for small traders.

• Monthly advance: approx. 7,500 CZK (exact amount depends on current social and health insurance rates for 2026).

2. Second band

For OSVČ with income up to 1.5 million CZK (regardless of activity type) or up to 2 million CZK with a higher expense allowance.

• Monthly advance: significantly higher, around 18,000 CZK. Here you need to calculate carefully whether the flat-rate is worth it.

3. Third band

For OSVČ with income up to 2 million CZK.

• Monthly advance: over 28,000 CZK. In this band the flat-rate is mainly beneficial for those with low real expenses.

Pros and cons: When the flat-rate is not worth it

Main advantages:

• Minimal administration (no tax return).
• Fewer tax authority inspections (there is nothing to check if you meet the entry conditions).
• Financial savings for traders with low expenses.

Disadvantages:

• You cannot claim tax discounts (taxpayer, children, spouse) or mortgage interest.
• You cannot claim tax bonuses.
• You pay even in months with low income (unless you suspend your trade).

If you have more children or high real expenses, classic taxation or percentage expense allowances can end up being more favorable than the flat-rate tax.

Calculate whether the flat-rate tax is worth it

Not sure which option is better for you? Use our OSVČ calculator and compare the flat-rate tax with standard taxation.