Tax optimisation: what to do every month
Most self-employed people think about taxes once a year — in March or April, when they file their tax return. That's when they realise they could have saved thousands of crowns by taking a few simple steps throughout the year. But by then, it's too late.
Tax optimisation isn't a one-off affair. It's a year-round process that requires attention every month. Not hours of work — usually 15–30 minutes a month is enough. But those minutes can save you tens of thousands of crowns a year.
In this article you'll find concrete steps for every month of the year to help you legally minimise your taxes and contributions. All information is based on current legislation and official sources from the Czech Financial Administration.
An important principle
Tax optimisation does not mean tax evasion. It's about legally making use of every option that the Income Tax Act offers. Every taxpayer has the right to arrange their affairs so that they pay the lowest possible taxes — as long as they act in accordance with the law.
Act No. 586/1992 Coll., on Income Taxes, offers a whole range of tools: flat-rate expenses, non-taxable portions of the tax base, tax credits, asset depreciation, and more. This article will show you how to use them effectively.
January: Review and planning
January is the month of new beginnings — and the ideal time for the self-employed to make strategic decisions for the entire year ahead.
Review the past year
📋January tasks
Flat-rate tax vs. standard regime
Comparison: flat-rate tax vs. standard regime
Example: Self-employed person with a general trade licence, annual income of CZK 800,000, actual expenses of CZK 200,000.
Option A – Flat-rate tax (1st band):
- Monthly advance payment: CZK 9,984
- Annual total: CZK 119,808 (tax + social + health insurance)
- No paperwork, no tax return
Option B – Flat-rate expenses at 60%:
- Income: CZK 800,000
- Flat-rate expenses (60%): CZK 480,000
- Tax base: CZK 320,000
- Tax at 15%: CZK 48,000
- Taxpayer credit: –CZK 30,840
- Tax payable: CZK 17,160
- Social insurance (29.2% of 50% of profit): CZK 46,720
- Health insurance (13.5% of 50% of profit): CZK 21,600
- Total: CZK 85,480
Option C – Actual expenses:
- Income: CZK 800,000
- Actual expenses: CZK 200,000
- Tax base: CZK 600,000
- Tax at 15%: CZK 90,000
- Taxpayer credit: –CZK 30,840
- Tax payable: CZK 59,160
- Social insurance: CZK 87,600
- Health insurance: CZK 40,500
- Total: CZK 187,260
Conclusion: In this example, flat-rate expenses are the most advantageous option, saving over CZK 100,000 compared to actual expenses.
When does the flat-rate tax pay off?
The flat-rate tax is particularly worthwhile for self-employed people who:
- Have low actual expenses (typically services, consulting, IT)
- Don't want to deal with administration (no tax return, no annual summaries)
- Have no employees and are not VAT payers
- Don't need to claim tax credits (for a spouse, children) or non-taxable portions
Conversely, it doesn't pay off for self-employed people with high actual expenses, significant credits and deductions to claim, or income close to zero.
You can find more details about the flat-rate tax on the Financial Administration website.
February: Preparing documents for your tax return
In February, start gathering documents for your tax return. The earlier you start, the less stress you'll have in March and April.
What to collect
📋February tasks
Non-taxable deductions — what you can still arrange
Watch out: some deductions require advance planning
Non-taxable portions of the tax base (§ 15 of the Income Tax Act) are claimed for the previous year. If you didn't contribute to a pension savings scheme or pay life insurance in the past year, you can't claim them in this year's return. But you can start now — and claim them in next year's return (filed the following year).
The combined limit for deducting pension savings and life insurance contributions is CZK 48,000 per year.
March: Finalising your tax return
For many self-employed people, March is the most stressful month. But if you've been following the plan in January and February, you should have everything ready.
Checklist before filing
📋March tasks
Optimisation: actual vs. flat-rate expenses
📊Flat-rate expenses — rates for 2025
When do actual expenses pay off?
Actual expenses pay off when your real business costs exceed the flat-rate percentage. This is typically the case for business owners with high costs for materials, subcontracting, or rent.
Example:
- Income: CZK 1,000,000 (general trade, flat-rate rate 60%)
- Flat-rate expenses: CZK 600,000
- Actual expenses: CZK 750,000 (materials CZK 400,000, rent CZK 200,000, other CZK 150,000)
In this case, actual expenses pay off — the tax base is CZK 150,000 lower, meaning a tax saving of CZK 22,500 (150,000 × 15%).
Watch out: With actual expenses, you must keep detailed records and archive all documents. With flat-rate expenses, you only need to record your income.
April: Tax return and first annual summaries
Paper vs. electronic filing
📊Comparison of filing methods
The benefit of electronic filing
Electronic filing gives you one extra month compared to paper filing. And since 2023, all self-employed people have been automatically assigned a data mailbox, making electronic filing effectively mandatory in practice. Make the most of it — you have until 4 May 2026.
Filing is free via the MOJE daně portal or through your data mailbox.
Paying your tax
Don't forget that the deadline for paying your tax is the same as the deadline for filing your return. What matters is the date the payment is credited to the tax office's account, not the date you send it. So send your payment at least 3 working days in advance.
May: Annual summaries and new advance payments
May is the second key month of the year — you submit your annual summaries to the Czech Social Security Administration (ČSSZ) and your health insurance provider, and you find out your new advance payment amounts.
Annual summaries for ČSSZ and your health insurer
📋May tasks
Optimising insurance advance payments
Minimum advance payments for 2026
| Insurance | Primary activity | Secondary activity | |-----------|----------------|-------------------| | Social insurance | CZK 5,720/month | CZK 1,574/month | | Health insurance | CZK 3,306/month | No minimum advance payments | | Total | CZK 9,026/month | CZK 1,574/month |
If self-employment is your secondary activity (e.g. you're also employed), your contributions can be significantly lower. For social insurance as a secondary activity, you only pay advances if your annual profit exceeds the threshold amount (approximately CZK 105,520 in 2025).
June: Annual summaries and planning for the second half of the year
Mid-year review
📋June tasks
The VAT registration threshold
Tracking your turnover for VAT purposes
From 2025, the threshold for mandatory VAT registration is set at CZK 2,000,000 over the past 12 consecutive months.
Watch out: This is not a calendar year — it's a rolling 12-month period. If in June 2026 you find that your turnover for the period July 2025 – June 2026 has exceeded CZK 2,000,000, you must register as a VAT payer within 15 days.
Example:
- Monthly income: approx. CZK 180,000
- Over 12 months: CZK 2,160,000 → VAT registration required
VAT registration doesn't just mean more administration — it can also be advantageous if you have a lot of VAT-inclusive inputs (materials, goods, services from VAT-registered suppliers).
July: A relaxed month — but stay aware
July is a quieter month — most of your annual obligations are behind you. But that doesn't mean there's nothing to do.
Mid-year = time for analysis
📋July tasks
August: Cost optimisation
Reviewing regular expenses
📋August tasks
What is and isn't a tax-deductible expense
Tax-deductible expenses are those incurred for the purpose of generating, securing, and maintaining income (§ 24 of the Income Tax Act). In practice, this means:
Tax-deductible:
- Purchase of materials and goods
- Rent for business premises or an office
- Phone and internet (proportional share when used for mixed purposes)
- Liability insurance
- Travel costs (travel allowances)
- Training and education related to your business
- Software and hardware for business use
NOT tax-deductible:
- Personal expenses unrelated to your business
- Fines and penalties (from public authorities)
- Entertainment (refreshments for clients — with some exceptions)
- Expenditure on acquiring assets worth over CZK 80,000 (these are depreciated)
September: Planning depreciation and investments
Asset depreciation
If you have business assets with a purchase price above CZK 80,000, you depreciate them gradually. Proper depreciation planning can significantly affect your tax base.
📊Depreciation groups
📋September tasks
Straight-line vs. accelerated depreciation
Example: Depreciation of a car (group 2, 5 years)
Purchase price of the car: CZK 500,000
Straight-line depreciation:
- Year 1: 11% → CZK 55,000
- Years 2–5: 22.25% → CZK 111,250 per year
Accelerated depreciation:
- Year 1: 500,000 / 5 = CZK 100,000
- Year 2: (2 × 400,000) / (6–1) = CZK 160,000
- Year 3: (2 × 240,000) / (6–2) = CZK 120,000
- Year 4: (2 × 120,000) / (6–3) = CZK 80,000
- Year 5: (2 × 40,000) / (6–4) = CZK 40,000
Accelerated depreciation produces higher deductions in the early years — useful if you have a high profit this year and want to reduce it. Straight-line depreciation spreads costs more evenly.
October: Preparing for year-end
Third quarter — time to make adjustments
📋October tasks
Key decisions at year-end
The last three months of the year are critical for tax optimisation, because you can still influence the size of your tax base for the whole year. The main tools are:
- Bringing forward expenses — make purchases you were planning anyway before the year ends
- Increasing pension/insurance contributions — top up to the optimal level
- Charitable donations — if you give to charity, time your donations within the current year
- Depreciation — putting an asset into use before the end of the year allows you to claim depreciation
- Bad debts — consider writing off irrecoverable receivables
November: Review and fine-tuning
The last chance to optimise
📋November tasks
Pension savings — the optimal contribution level
Optimal pension savings contribution
From 2024, only contributions to pension savings above CZK 1,700 per month count towards the tax deduction. The combined limit for the deduction (pension savings + life insurance) is CZK 48,000 per year.
How to reach the maximum deduction from pension savings alone:
- Monthly contribution: CZK 5,700
- Eligible for deduction: CZK 5,700 – CZK 1,700 = CZK 4,000 per month
- Annual deduction: CZK 4,000 × 12 = CZK 48,000
- Tax saving (15%): CZK 7,200
- Tax saving (23%): CZK 11,040 (for higher earners)
On top of that, with contributions of CZK 1,700 or more you receive the maximum state contribution of CZK 340 per month (CZK 4,080 per year).
Total benefit: Tax saving of CZK 7,200 + state contribution of CZK 4,080 = CZK 11,280 per year — just from setting up your pension savings correctly.
December: Closing out the year
Final steps before year-end
📋December tasks
Flat-rate vehicle expenses from 2025
From 2025, when using a car for business purposes you can claim a flat-rate transport expense of CZK 5,000 per month per vehicle (up to 3 vehicles). If the car is also used for private purposes, the flat rate is reduced to 80%, i.e. CZK 4,000 per month.
When claiming the flat-rate transport expense, you cannot claim actual fuel costs. However, you can still claim depreciation, insurance, repairs, and maintenance.
Year-round habits for optimal taxes
Beyond the specific monthly tasks, there are habits you should maintain throughout the entire year.
1. Keeping records of documents as you go
The worst thing you can do is collect receipts in a box and deal with them once a year. Ideally, record every document on the day it arises — or at least once a week.
2. Separating personal and business expenses
Use a dedicated business account. Personal expenses paid from a business account complicate your record-keeping and can cause problems during a tax audit.
3. Monitoring your cash flow
Every month, check how much you've earned, how much you've spent, and how much is left. It's simple — but most self-employed people don't do it.
4. Setting aside money for taxes and contributions
The rule of thumb: from every payment you receive, set aside approximately 40–50% for taxes and contributions. This way you'll avoid a nasty surprise when payment time comes around.
How much to set aside for taxes and contributions
Approximate calculation for self-employed people with flat-rate expenses at 60%:
- From every CZK 100,000 of income, the tax base is: CZK 40,000
- Income tax (15%): CZK 6,000
- Social insurance (29.2% of 50%): CZK 5,840
- Health insurance (13.5% of 50%): CZK 2,700
- Total: approximately CZK 14,540 from every CZK 100,000 of income (approx. 15%)
With flat-rate expenses at 80%, it's approximately 7%. With actual expenses, it depends on the ratio of expenses to income.
Tip: Open a savings account and regularly transfer the corresponding share of your income into it. By the end of the year, you'll have the money ready.
Frequently asked questions (FAQ)
Can I switch between flat-rate and actual expenses from one year to the next?
Yes. You can decide each year whether to claim flat-rate or actual expenses. The decision is made when you file your tax return. But be aware: if you're switching from actual expenses to flat-rate (or vice versa), you must adjust the tax base for the previous period (§ 23(8) of the Income Tax Act) — you'll need to include any unpaid receivables and stock in your taxable income.
Can I combine flat-rate and actual expenses for different types of income?
No. If you claim flat-rate expenses for income from self-employment (§ 7 of the Income Tax Act), you must apply them to all income under § 7. You cannot combine flat-rate expenses for one activity and actual expenses for another. The exception is when you have income from different sections of the Act (e.g. § 7 and § 9 — rental income).
How much does a tax adviser cost, and is it worth it?
The cost of preparing a tax return for a self-employed person ranges from CZK 2,000 to CZK 8,000, depending on complexity. It's worth it if your tax situation is more complex (multiple income streams, assets, foreign income) or if you want to take advantage of the extended deadline to 1 July.
Do self-employed people have to file their tax return electronically?
Yes, if you have an activated data mailbox — and since 2023, all self-employed people have been assigned one automatically. But electronic filing has a benefit: the deadline is one month longer (4 May instead of 1 April).
What is the threshold amount for secondary self-employment activity?
For 2025, the threshold for social insurance purposes under secondary self-employment activity is approximately CZK 105,520 in annual profit. If your profit doesn't exceed this amount, you don't need to pay social insurance advance payments. The threshold changes every year.
Get help with tax optimisation
Keeping track of your tax obligations and optimisation opportunities month by month requires discipline and know-how. If you don't have the time, or you don't want to risk forgetting something, get some help.
DokladBot: your tax optimisation companion
DokladBot helps you via WhatsApp not only with tracking documents and deadline reminders, but also with ongoing oversight of your finances. You can ask at any time:
- "How much income and expenses have I had this year?"
- "Would flat-rate or actual expenses work better for me?"
- "How much should I be setting aside for taxes?"
- "Am I getting close to the VAT threshold?"
DokladBot knows your numbers and can answer you instantly — no waiting for a meeting with an accountant, no logging into software.
Try it at dokladbot.cz and keep your taxes under control all year round.
Official sources:
- Czech Financial Administration — income tax
- Czech Financial Administration — flat-rate tax
- Czech Financial Administration — tax news 2026
- ČSSZ — insurance advance payments
- MOJE daně portal
This article is intended as an informational guide and does not replace professional tax advice. Discuss specific optimisation strategies with a tax adviser who knows your individual situation. Information is correct as of the date of publication.
Nechcete ztrácet čas s papírováním?
Vyzkoušejte DokladBot - účetnictví přes WhatsApp. První týden zdarma.
Related articles
10 Most Common Mistakes in the OSVČ Tax Return
Every year, thousands of self-employed individuals make the same mistakes in their tax returns — wrong form, missing attachments, or incorrect calculations. Go through the 10 most common mistakes and find out how to avoid them.
Airbnb and Short-Term Rental: How to Tax Your Income
Are you renting out your flat through Airbnb or Booking? Find out how to correctly tax your short-term rental income, when you need a trade licence, and what obligations await you in 2026.
All Tax Deductions for the Self-Employed in One Place – 2026 Overview
An overview of all tax credits and non-taxable portions of the tax base that self-employed individuals can claim on their 2025 tax return. Including abolished credits and practical examples.