Starting a side business while employed

A trade licence next to a job changes three things at once: your registrations, your insurance and who files your tax return. The job keeps paying the minimums, which makes the side business cheaper than it looks.

Deadline: 8 days from starting

Registration with your health insurer. ČSSZ by the 8th day of the following month.

Open the side-business calculator

What to register and when

Three registrations, three different clocks. The trade office notification also passes your details to the tax office.

The trade licence at any trade office, which also registers you for income tax.
Your health insurer within 8 days of starting the activity.
ČSSZ by the 8th day of the calendar month following the month you started.

Secondary activity is the point

Because your employer already pays insurance from your salary, the business counts as a secondary activity. That removes the minimum bases which make a main activity expensive.

No minimum assessment base for either social security or health insurance.
Pension insurance becomes compulsory only once the year's income from the activity passes the statutory threshold.
No social security advances in the first year, and none later while you stay below the threshold.

Your return, not the employer's

The side business moves the return from your employer to you, and the threshold that does it is low.

Once income outside employment passes 20 000 CZK a year, the employer annual settlement is no longer available.
You ask the employer for a certificate of taxable income and enter the salary in the return yourself.
Business income goes in the §7 attachment, with flat expenses at your activity's rate or real ones.

Paušální daň is not an option

The flat-tax regime excludes anyone with employment income, so your choice is between real and percentage expenses.

Employment income rules out paušální daň for the whole tax period.
Percentage expenses are usually the simpler answer while the side business is small.
Keep the business income and costs apart from the salary, because only the business part carries insurance.

Common questions

What is the threshold for pension insurance?

It is set each year as a multiple of the average wage, so the amount moves. What matters is the mechanism: below the threshold you owe no pension insurance from the side business, and above it the obligation applies for the whole year and is settled through the overview.

Do I pay insurance monthly from the start?

Not on a secondary activity. Social security has no advances in the first year, and health insurance on a secondary activity is paid once a year through the overview rather than monthly.

What happens if I leave the job?

The activity becomes your main one from that month, with minimum bases and monthly advances for both insurances. Report the change to ČSSZ and your insurer, because the minimums start from the month the employment ends.

See the net before you register

The employment and side-business calculator shows your net salary and the extra tax, social security and health insurance the side business adds.