How to set up a trade? Just 3 steps and you are self-employed
Make it easier for you to start your business and read our guide on how to go about setting up a business. We'll guide you through the entire process, from choosing a business to submitting the registration form.
1. CHOOSE THE TYPE AND BRANCH OF TRADE
Successfully registering a trade starts with being clear about which business you want to be in. You might think you know - you'll be a graphic designer, translator, accountant or set up an e-shop. However, it's important to translate the name of the business into the language of the authorities so that you fill it in correctly on the form for setting up a business. The official names are sometimes confusing, so we can help you to find your way around.
Proceed as follows:
- Write down what you will do as a sole trader.
- Browse the lists of free, craft, bound, and licensed, trades.
- Choose the names of the activities that match your business from the lists.
- Make a note of the activities and whether they are free, craft, tied or licensed trades - this will help you find out what conditions you need to meet to be able to do business in the next step.
TIP: Want to better understand the differences between trades and get more practical tips to help you choose? Read our detailed article on how to choose the type and branch of trade.
2. CHECK IF YOU MEET THE CONDITIONS
Congratulations - you're now clear on what you're going to do. What's next? The law sets out two general conditions that you must meet as a sole trader:
- Full legal capacity (you can prove your age over 18 with your ID; if you are younger, you will need an extra document - a court order for the consent of the minor's legal guardian to run the business independently).
- Integrity (the Trade Licensing Authority will verify this in the criminal record itself).
CONDITIONS OF FREE TRADE
If your chosen field falls within the scope of free trades, you only need to meet the two basic conditions above to obtain a trade licence. You do not need to provide any further documentation.
CONDITIONS OF CRAFT AND BOUND TRADES
In the case of bonded and craft trades, you must also provide additional documents. The exact requirements are laid down by law, usually confirming your professional competence - whether you have graduated from a school in the field, have sufficient experience or a retraining course. If you do not meet the requirements, you can replace the proof of competence with a responsible representative or guarantor who will meet the requirements for you.
CONDITIONS OF THE LICENSED TRADE
In the case of a licensed trade, it is necessary to obtain a special permit to operate the trade (concession) issued by the state or municipality. The conditions for obtaining a concession vary across industries - see Annex 3 of the Trade Licensing Act for details.
3. SUBMIT THE FORM TO THE TRADE LICENSING OFFICE
You start your trade by submitting a single registration form (abbreviated JRF) to the trade licensing office. You fill in your personal details, the chosen trade and your registered office. If you do not want to have a registered office at home and choose another address or a virtual registered office for the self-employed person, you must provide proof that the property owner agrees to the location of the registered office - so prepare this consent in advance.
With the JRF you can also notify your health insurance company, the Czech Social Security Agency and the tax office about the start of your business. This saves you work and you do not have to inform each institution separately.
SETTING UP A BUSINESS IN PERSON
You can set up a trade in person at any branch of the trade office, it does not have to be the office where you live. The office staff will complete the form with you and answer any questions you may have. You will pay an administrative fee of CZK 1,000 for registering your trade or applying for a licence at the office.
If you have chosen a trade from the list of free, bound or craft trades and you meet all the conditions, you become self-employed immediately after filing the JRF (i.e. on the same day, or you can choose a different starting day for your business when registering). However, if you are applying for a licensed trade, you must wait until the licence is granted.
SETTING UP A BUSINESS REMOTELY
It is also possible to process a trade licence remotely, but in this case you must complete the form yourself - we recommend downloading the instructions from the Ministry of Industry and Trade.
You have two options for setting up a remote business:
Both registrations cost CZK 1,000 and you can pay the fee by postal order or bank transfer (after agreement with the office). Within 5 days of receipt of the notification, the office will register the business in the Trade Register.
SETTING UP A BUSINESS WITH THE HELP OF SPECIALISTS
Don't you like queuing at the offices and filling in forms? Use our services. We will take care of the trade license completely for you - we will advise you on the choice of the field and you will get the trade license quickly and without any worries.
Fill in the contact form and we will get back to you - we can sort everything out by email or phone. A personal meeting is not necessary, but of course we will be happy to welcome you in our Prague office.