Czech Republic PEO Services

Expats looking to get set up in the Czech market can usually expect good salary and benefits packages in the country. Most expats who enter Czech Republic do so in senior positions, however foreign workers can be found across all stages of a company’s structure.

The Czech Republic’s primary industries are engineering (mostly automotive), chemicals, food, metallurgical, energy and construction.

Employment Information

• Businesses looking to set-up a business in the Czech Republic may operate through a branch office, or by establishing a Czech Company
• Foreigners can conduct trade activities under the same conditions and to the same extent as Czech entrepreneurs
• Foreign businesses can purchase a shelf company (a ready-made company), as a fast route to set up a business in the Czech Republic
• The Ministry of Finance of the Czech Republic is the Accounting Regulatory Body
• As a part of the EU, the Czech Republic follows similar procedures to other EU states, and it can be easily relocated to for EU-based expatriates and businesses

Taxation and Contributions

• The Czech Republic has a flat rate for income tax of 15%. This is calculated from ‘super-gross’ salary, meaning the sum of income, social insurance and health insurance paid by the employer
• There is an additional 7% solidarity tax for any income which exceeds 48x the average wage
• Employees must contribute insurance from the gross salary monthly: 4.5% health insurance and 9% social insurance
• Employers must bear the insurance costs on their employee’s salaries as well: 31.3% social and health insurance
• Residents in the Czech Republic are taxed on their worldwide income. Non-residents are taxed on only their Czech-sourced income
• The corporation tax rate in Czech Republic is 19%
• The capital gains tax rate is 19% of legal entities
• There is a 5% tax on the income of certain investments, mutual funds, or pension funds

Cultural Information

The official language of the Czech Republic is Czech. Czech is spoken by approximately 10.6 million people and resembles similarities to other West Slavic languages such as Polish, Russian, and Croatian. A large percentage of the Czech population can speak English to a certain level, this is estimated to be around 25% of the population.

The Czech Republic is a relatively secular nation, although the biggest religious group are Roman Catholic (around 39% of the population). The Czech Republic has a population of around 10.7 million people.

Impacts from COVID-19

Akin to other countries around the world, the Czech Republic’s steady economic growth was hit hard by the COVID-19 pandemic. Remote working and flexible working patterns have become common within the country, particularly within business sectors, and these practices look set to continue.

The Czech Republic has been efficient with its vaccine rollout and has successfully fully vaccinated 61.2% of its population (as of December 2021).