Obtain Trade License in Czech Republic

Obtain Trade License in Czech Republic

Updated on Friday 28th June 2019

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Company-registration-in-Czech-Republic.jpgApplying for a trade license is one of the important things to consider when deciding on opening a business in the Czech Republic. All foreign entrepreneurs will have to align with the requirements in this sense and obtain the proper license for their future activities. The procedures involved in obtaining the trade license can be explained by our Czech lawyers who can provide legal advice in this matter. They can also help you register a business in the Czech Republic.

What is the Czech trade license?

The trade license in the Czech Republic is necessary for the type of entrepreneurs wanting to establish sole proprietorships. This means that if you want to do business on your own, you will have to obtain a trade license in the Czech Republic before starting the activities. Freelancer entrepreneurs need to register with the Commercial Court as soon as the business name has been chosen. Here is what you need to provide in matters of documents:
  1. The proof of your citizenship and permanent residency in the Czech Republic.
  2. An application form for registering the sole proprietorship is provided at the local registry.
  3. Documents showing that your criminal record is clear;
  4. A copy of the documents of the business place and permission in this sense.
  5. The proper trade license form submitted by the sole trader.
It is necessary to respect all the formalities involved and have an idea from the start about the business you want to register. This is where our Czech attorneys can provide immediate legal advice and support for obtaining the trade license in the Czech Republic, in order for you to focus on other business requirements. 

Categories of Czech trade license

Foreign entrepreneurs wanting to start a business in the Czech Republic and obtain the trade license can choose from the following:
  • •    32 professional trades among which tax accountants, lawyers, medical equipment manufacturer;
  • •    17 craft trades like watchmaking, locksmith or jewelers;
  • •    80 unqualified trades involving photographers, farmers tourist agents, language teachers, etc. 
It is good to know that specific rules apply to craft trades, in order for manufacturers to respect the general product standards. Also, the experience of professionals must be proven at the time of the trade license application. Please do not hesitate to ask for legal advice from our team of attorneys in the Czech Republic and find out the legal aspects for applying and obtaining the Czech trade license.

Do I need health insurance if I’m a freelancer?

Yes, it is an obligation to have health insurance if you want to perform activities as a sole trader in the Czech Republic. The public health insurance is necessary for any kind of entrepreneur, whether domestic or from EU countries. In case of residents from countries which are not part of the European Union (except Turkey), these will have to apply for private health insurance in order to legally act as a sole trader in the Czech Republic. Once the Czech trade license has been obtained, entrepreneurs will have to pay attention to health insurance as the following step for the registration. Do not hesitate to talk to our Czech lawyers and find out more about how to obtain a trade license in the Czech Republic.

Tax obligations for sole traders in the Czech Republic

Entrepreneurs in the Czech Republic will have to register for tax purposes as soon as the trade license has been issued. This means that you need to register with social security, the tax administration and the health system in the Czech Republic. There are no complicated requirements, however, instead of dealing with formalities you don’t understand, it is best to talk to our Czech attorneys.

Why register as a sole trader in the Czech Republic?

It is quite easy and fast to activate as a sole trader in the Czech Republic, especially if you have the necessary qualifications. The tax requirements and the administration of a sole proprietorship in the Czech Republic are simple and there is no need to consider a general annual meeting like in the case of other business structures. Craftsmen can easily enter the Czech market and benefit from complete support from the authorities in any category of activity. The following facts and statistics show the business direction in the Czech Republic:
  • The GDP grew by 2.6% in 2018 compared to the previous year.
  • USD 215.91 billion represents the GDP registered in 2018.
  • USD 180.19 billion represents the exports of the Czech Republic.
  • There is 0 taxation for trade license revenues less than CZK 400.000.
If you would like to know more about the trade license in the Czech Republic, feel free to contact our Czech law firm.