What Do You Need to Report for Tax Purposes? Understand Occasional Income

Quick Overview

Occasional income refers to one-time or incidental earnings outside of employment or business activities. In 2026, you do not have to pay taxes on this income if the total amount for the entire year does not exceed 50,000 CZK. If you exceed this limit, you must report the income on your tax return as “other income” under the Income Tax Act. Be careful, however, with recurring earnings, advertising services, or multiple customers—in such cases, it may be considered a business, even if you earn less than 50,000 Kč.

Key Rules:

• Occasional income up to 50,000 Kč per year is tax-exempt.
• The limit is calculated as the total of all occasional income for the year.
• Once the limit is exceeded, the entire income is taxed, not just the portion above 50,000 Kč.
• No social security or health insurance contributions are due on truly occasional income.
• A recurring or publicly offered activity may be considered a business.

Not sure if your side income still qualifies as occasional income or if it’s already a business? Tell us what you do, how often, and how much you earn from it. A lawyer from Dostupný advokát will help you determine whether you need to pay taxes on your income, file a tax return, or register a business.

A side hustle may seem harmless. You might babysit once in a while, help a neighbor move, sell an old phone, or build a simple website for a friend. However, from the tax authority’s perspective, it’s important to determine whether this is truly occasional income or a systematic business activity.

You’ll find the basic rules in the Income Tax Act. It allows certain one-time income to be exempt from tax, provided it does not exceed the statutory limit and does not exhibit the characteristics of a business.

What is occasional income?

The term “occasional income” refers to one-time earnings that a person receives outside of their employment, business, or other regular gainful activity. Typically, this includes activities such as helping a neighbor move for a fee, babysitting, a one-time repair of someone else’s computer, selling old household items, renting out a car (if you don’t do this regularly), occasional gigs as a DJ or musician, occasional copywriting, photo editing, logo design, tutoring, or even selling produce from your own garden.

The law classifies this income as “other income,” and pursuant to Section 10 of Act No. 586/1992 Coll., on Income Tax, it allows this income to be exempt from tax.

How much money can you earn without paying taxes?

And now for the most important part—how much money can you earn on the side in a year without having to pay taxes on that income? You’re in the clear if your occasional income doesn’t exceed 50,000 CZK for the entire year; up to this amount, it’s tax-free income that you don’t have to report. You don’t have to report any earnings up to 50,000 Kč anywhere; you don’t file a tax return for them, nor do you pay any health or social insurance on them.

However, we must emphasize a few rules you need to keep in mind:

• This 50,000 Kč threshold applies cumulatively to all occasional income for the entire year.
• It doesn’t matter whether it’s one large payment or several smaller ones—as long as the total falls within the limit, everything is tax-free.
• This limit does not apply to income from employment or business activities —only to exceptional and incidental income that cannot be considered a regular activity.

How does this work in practice?

Eva babysat her friend’s children several times during the year. Her friend paid her 10,000 Kč as compensation. In addition, Eva sold an old refrigerator for 5,000 Kč. Her total income from these occasional activities was therefore 15,000 Kč. The result? This is non-taxable income; Eva doesn’t need to do anything because she didn’t exceed the 50,000 Kč threshold.

Martin created a one-time website for an acquaintance and helped him set up ads on social media, for which he received 55,000 Kč. He had no other side income that year. However, since he exceeded the 50,000 Kč threshold, he must pay taxes on the income, even though it was a one-time side job. But be careful: he must pay taxes on the full 55,000 Kč, not just the amount by which he exceeded the threshold.

In practice, we often see that people focus only on the 50,000 Kč threshold but forget to consider the nature of the activity itself. The tax office may ask not only how much you earned, but also whether it was a one-time gig or a service offered on a regular basis. A common mistake, for example, is when someone claims to have occasional income but has been advertising their services online for a long time.

What if I exceed the limit?

As soon as your occasional income exceeds the 50,000 Kč threshold—even if it’s just a one-time side job— you must pay taxes on the entire amount. It is precisely the fact that the entire income is taxed—and not just the portion exceeding the 50,000 Kč limit—that surprises many people.

You must file a tax return for this income. In Appendix No. 2, report the income in accordance with Section 10 of the Income Tax Act. You’ll pay tax on this income at a rate of 15% (or 23% if the amount happens to exceed 48 times the average wage). You do not pay social security or health insurance on this income—provided, of course, that it is not actually business income.

Not sure whether you should report this income on your tax return or if you’re still eligible for an exemption? Send us a brief description of the income, the amount, and the circumstances under which you received the money. We’ll help you determine whether this is occasional income or if you need to treat it as a business.

When is income no longer considered occasional?

Some types of income cannot be considered occasional, even if they are just a one-time source of extra income. This group includes, for example:

• income from employment,
• income from business activities (self-employment),
• income from renting (unless it is entirely exceptional),
• recurring income of the same type (e.g., regular tutoring),
• income that exhibits characteristics of a business (consistency, promotion, intent to make a profit).

This is a rather tricky issue, as the law does not explicitly define what constitutes occasional income and what does not. However, several principles apply here. If you perform a given activity repeatedly (such as writing articles every month), it may be considered a systematic activity, in which case it would no longer be considered non-taxable income. Similarly, publicly offering services (such as advertising on the internet) constitutes a business. And if you have multiple clients and are actively seeking out opportunities, this may constitute illegal business activity without a business license.

How this works in practice:

Tomáš occasionally takes photos at weddings. He usually does three weddings a year, each for 10,000 Kč. However, he doesn’t advertise this anywhere and mostly takes photos for his friends. As a result, his activity can be considered a one-time side job. However, once he creates a website, promotes his work on social media, and starts taking photos every month, it will be considered a business that requires a business license.

The line between occasional income and a business may not always be clear-cut. In specific cases, courts and authorities may evaluate factors such as frequency, independence, promotion, the number of customers, and the intent to make a profit. Therefore, you cannot rely solely on the fact that “I earned less than 50,000 CZK”—if the activity appears to be a business from the outside, it could still be problematic even with a lower amount.

If you’re unsure whether your activity can be considered occasional income or whether it already constitutes a business, you can contact us. Our attorney will assess your situation and explain how the law views it.

Do I need to keep a record of one-time side income?

The law does not require you to keeprecords of one-time side income if it is non-taxable income within the aforementioned limit. However, we strongly recommend keeping simple records of your income—if only for your own reference and to provide an explanation should you be audited by the tax office. Write down the date, a description of the income, the amount, and who you provided the service to or from whom you received the money. For income from the sale of items, it’s always a good idea to document in some way that this is not a new sale, but rather the sale of a used household item.

Summary

Occasional income allows you to legally earn extra money tax-free, provided that it is truly incidental income outside of employment or business activities and that the total amount of such income for the year does not exceed 50,000 CZK. Once you exceed this limit, you must report the entire amount of income on your tax return in accordance with Section 10 of the Income Tax Act, not just the portion above the limit. Social security and health insurance are not paid on truly occasional income, but this applies only if the activity does not constitute a business. Recurring jobs, publicly offering services, having multiple clients, or a regular intention to earn money may mean that you need to register a trade license. Although the law does not require formal record-keeping for small amounts of occasional income, we recommend keeping a record of the amounts and circumstances of your side income so that you can explain them to the tax office if necessary.