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

FLAT-RATE TAX AND TAX RETURN - WHEN TO FILE IT?

If you are self-employed and use a flat tax, don't rely on getting rid of tax issues forever. In the following situations, you must still file a tax return even though you paid a flat tax:

None of the points apply to you? Great, then you really benefit from the flat-rate scheme and you don't have to deal with the tax return.

HOW TO FILE A FLAT-RATE TAX RETURN?

If you do not meet the conditions of the flat-rate tax, you are obliged to file a tax return. How to do it?

1. You will calculate your tax according to the general rules as if you were not in the flat-rate scheme. You list all your income, including business income.
2. Line 86 of the tax return is for advances paid under the flat-rate tax. In 2021 and 2022, the amount of the flat-rate tax includes CZK 100 per month for income tax, for a total of CZK 1 200 per year.
3. If you were employed, you should also enter your advance payments of employment tax on line 84.
4. The tax authority will refund any overpayment or you will pay the underpayment.

You 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 in the amount of the flat-rate tax serving as a deposit.

AND WHAT NEXT - CAN YOU STAY IN THE FLAT-RATE SCHEME AFTER FILING YOUR RETURN?

If you breach certain conditions, you must opt out of the flat-rate scheme and pay the normal social security and health insurance contributions and submit a tax return in the following year. This will be the case if:

• Your business income was more than CZK 1 000 000.
• You have become a VAT payer.
• You have become a partner in a publicly traded company or a general partner in a limited partnership.

In the following cases, there is no reason to end the flat-rate scheme:

• Other income exceeded CZK 15 000.
• You had income from employment not subject to withholding tax.

You submit your 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 TAXES AND LEAVE IT TO US

Have you found out that you are required to file a tax return this year but don't know how to do it? Contact us and we'll get your income tax return sorted.