Small business owners and self-employed individuals will need to dig deeper into their pockets starting in the New Year. Those paying minimum social and health insurance advances will see a combined increase of 1,124 Czech crowns monthly if self-employment is their main activity.
“The minimum social insurance advance for main business activities will rise from 4,759 to 5,720 crowns, while health insurance will increase from 3,143 to 3,306 crowns,” confirmed tax advisor Gabriela Ivanco from Forvis Mazars. Those paying taxes under the flat-rate system will also be affected, with monthly payments in the first tier increasing by 1,268 crowns to 9,984 crowns.
The substantial increase stems from two factors: the standard annual growth in average wages, which is set at 48,967 crowns for 2026 (approximately 5% higher), and an increase in the minimum assessment base for social insurance from this year’s 35% to 40% of the average wage next year.
This change primarily affects small entrepreneurs paying minimum advances, while those who contribute more based on actual income will only see an increase in line with average wage growth. The government has justified this measure as an effort to ensure more dignified future pensions for entrepreneurs, as minimum contributions generate minimum pensions.
According to Martina Šotníková, tax advisor at Rödl & Partner, the impact will be most significant for the smallest entrepreneurs operating at minimum levels. Some will try to incorporate these higher contributions into their prices, but market competition and customer purchasing power have their limits. This may lead some business owners to conclude that maintaining self-employment as their main activity is no longer worthwhile, potentially driving them to either terminate their business entirely or formally, continue operating in the shadow economy, or keep their business only as a secondary activity alongside employment.
There are some relief measures available: beginning entrepreneurs pay reduced minimum advances of just 3,575 crowns in their first two years, and they don’t need to pay these continuously but can settle them after the end of the tax period.