Flat-rate tax for self-employed: 5 situations where you need to file a tax return

Flat-rate tax and tax returns - when to file?

"You don't file a tax return with a flat rate tax." - You've probably heard that one too many times. But as it happens with taxes, there are a few "buts". In these situations, you have to file a return even though you're on a flat-rate system:

Neither of these points apply to you? Great - then you'll really appreciate the benefits of the flat-rate scheme and you won't have to deal with the paperwork.

How to file a flat-rate tax return?

If you don't meet the conditions for a flat-rate tax, you'll have to file a tax return. How to do it?

1. You work out your tax under the general rules as if you were not in the flat-rate scheme. You list all your income, including income from your business.
2. On line 86 of the tax return, you fill in the amount of the flat-rate tax paid in advance. In 2021-2023, always include CZK 100 per month for income tax, making a total of CZK 1,200 per year.
3. If you were employed, you will also enter the advance payments of employment tax on line 84.
4. Any overpayment will be refunded by the tax authority or you will pay the underpayment.

Do the same for social security and health insurance. You send the statements to the Social Security and Health Insurance Institutions, with the premiums paid under the flat-rate tax serving as a deposit.

What next - can you stay in the flat-rate scheme?

If you breach certain conditions, you must leave the flat-rate scheme, start paying the normal social security and health insurance contributions and submit your tax return in the following year. This will be the case if:

• Your business income was more than CZK 2,000,000 per year.
• You became a VAT payer.
• You became a partner in a publicly traded company or a general partner in a limited partnership.

In the following situations, on the other hand, there is no reason to end the flat-rate scheme:

• Your other income exceeds CZK 50,000 per year.
• You had income from employment not subject to withholding tax.

You submit a return to the tax office and continue to pay the flat-rate tax. However, if you continue to have this income, consider whether it makes sense to stay in the flat-rate scheme - you will have to file your tax return again next year.

Don't worry about tax and leave it to us

Have you found you need to file a tax return but don't know how to do it? Contact us and we'll sort out your income tax return for you. And if you're not sure if the liability applies to you, book a tax consultation.