Flat-rate tax return: when do you have to file it and how?

Once you have other taxable income in addition to your business above the statutory limit, enter a different regime during the year (for example, becoming a VAT payer) or fail to meet the other conditions of the flat-rate scheme, the obligation to file a tax return reverts. In this article we explain clearly when to file a flat-rate tax return, exactly how to proceed and what to look out for.

What is a flat-rate tax and how does it work

The flat-rate tax is a voluntary scheme for self-employed people, in which you pay one monthly payment in advance for income tax, health and social security. As long as you meet the conditions throughout the year, your annual tax is equal to the flat rate tax and you don’t file returns or reports. The final amount of the advance then depends on your annual income due to your inclusion in the flat-rate tax bands.

Under the flat-rate conditions, imagine in particular that you are not subject to VAT, you are not a partner in a limited company or general partner in a limited company, you are not in insolvency proceedings, and you are not in employment subject to advance tax on 1 January (or when you start your business) (the exceptions are income from employment or agreements taxed at withholding).

When do you have to file a tax return even if you are on a flat rate?

In practice, there are two basic situations:

1) You have other taxable income (outside the business) over CZK 50,000 per year

If in the year when you are in the flat-rate regime, you receive in aggregate income from capital, rent or other income (typically interest, dividends from abroad, renting a flat outside business property, selling securities, crypto, etc.) over CZK 50,000, you must file a tax return. Limit 50 000. This income does not include exempt income and income taxed by withholding (e.g. part-time work on a DPP or FTE without a signed taxpayer declaration).

Exceeding the CZK 50,000 limit does not in itself exclude you from the flat-rate; you just file a return for the year and include all income.

Practical example: you are in a lump sum for the whole year 2025 and you rent out a flat outside a business property. The rent collected in 2025 was CZK 72 000. Because you exceed CZK 50,000, you file a return. In it, you include your business income and include the monthly lump sum tax payments paid as advance tax payments on the relevant line. If the advances exceed the calculated tax, you will be overpaid.

2) During the year you breach one of the conditions of the flat-rate scheme

The law specifically says when you stop being a flat-rate taxpayer. Typically, when you exceed the qualifying income for your chosen band (and your tax is also not equal to the flat rate tax), you become liable for VAT, you enter into a v.o.s. / you become a general partner of a limited company, or a bankruptcy order comes into force and the insolvency proceedings are not completed by the end of the year. In such a year , your resulting tax may already be classic income tax, so you file a return.

Practical example: in July 2025 you will exceed the turnover for compulsory VAT registration and become a taxpayer. Under the law, you will cease to be in the flat-rate scheme and you will file a return for 2025, even though you have paid your flat-rate payments honestly up to July.

3) Adjustment of the tax base when switching to the flat-rate scheme

You may also be required to file a tax return and make a so-called tax base adjustment (e.g. for outstanding debts and liabilities, inventory, depreciation differences, etc.) when you enter the flat-rate regime. If you are obliged to make this adjustment in a given year, you will file a tax return even if you are otherwise in the flat-rate scheme and no other reason to file a return would arise.

Practical example: you enter a flat-rate tax on 1 January 2025. At the end of the previous period, you have outstanding accounts receivable and inventory for which you must make a one-time adjustment to your tax basis. You will then file a return for 2025 reflecting the adjustment, and you will also include your lump-sum advances. If the advances exceed the resulting tax liability, an overpayment will result.

Flat-rate scheme and employment

If you are employed on an agreement taxed by withholding (typically a DPP without a signed declaration up to the limit), this does not in itself breach the flat rate and you do not need to file a return because of this. It’s different if you are in an advance taxed job – this is incompatible with the lump sum condition and will lead to a loss of the lump sum and a compulsory return.

How to file a lump sum tax return

Basically, you do as a regular taxpayer and add the lump sum payments you have made:

1. Complete your personal income tax return in the online application MY Taxes. Enter all income: from self-employment (as if you were not in the flat rate), from employment (if applicable), from capital, from rent and other.
2. Include lump-sum advances: add to your return the amounts you paid in lump-sum tax as advances of income tax during the year (totalled over the year). This will avoid double taxation and will result in an overpayment or underpayment.
3. Submit electronically via MY Taxes or a data box. Then pay any underpayment no later than the last day of your deadline.

What is a lump sum advance? As part of the monthly payment, a small amount is allocated to income tax (in addition to social security and health tax). You record it on your tax return in a similar way to traditional advance payments – it is deducted from your calculated annual tax.

Deadlines: by when to file a lump-sum tax return

If you have to file a return, the same deadlines apply to you as to other individuals: on paper by 1 April, electronically (via the MY Tax portal or data box) by 2 May, and with a tax adviser by 1 July of the year. The calculated tax is due by the same deadlines.

Summary

The flat-rate tax for self-employed people replaces income tax, health and social security tax in one monthly payment – and if you meet the conditions for the whole year and have no other taxable income over CZK 50,000, you don’t file a tax return or report. However, a return is filed in two typical cases: (1) you have aggregate capital/rent/other income outside the business above CZK 50,000, (2) you breach the lump sum conditions in the year.

You fill in the return in MY Tax as a regular taxpayer (listing all income) and list the monthly lump sum payments you have paid as advance income tax payments – this avoids double taxation and allows any overpayment or underpayment to come out. The deadlines are the same as for the others: paper by 1 April, electronic by 2 May, with an adviser by 1 July; tax is due by the same dates. If you exceed the qualifying income for the band in a year, you can only catch up on the lump sum if the resulting tax comes out equal to the flat tax – otherwise you leave the lump sum and file the return.