Going self-employed in Czechia? Here’s how to get your trade license

Expats working across various industries in Czechia find benefits in being self-employed. The flexibility of “being your own boss” allows you to choose your own projects and working hours while pursuing your interests and passions.

These benefits make self-employment a dream for many – but in Czechia, you first must overcome the daunting obstacle of obtaining your “trade license” (Živnostenský list in Czech). This license enables you to work as a “sole proprietor” (osoba samostatně výdělečně činná, or OSVČ), earning income from independent business activities.

Any expat who has obtained this trade license will confirm that the process can be painful. Given the at-times “Kafkaesque” nature of Czech official administrative procedures, it’s a process in which the help of experts can make all the difference. HJ Taxes aims explicitly to support expats in obtaining their trade license, allowing them to succeed as entrepreneurs in Czechia.

According to Jaroslava Mehessen, an expert in trade license applications at HJ Taxes, “the process for obtaining a trade license is always highly individual.”

“Getting the license requires various documents, many of which will depend on your country of origin,” she says. “These typically include a criminal record check and other necessary documentation, all of which require various stamps and authorizations. Sometimes, getting hold of these documents in the right form is harder than it should be.”

HJ Taxes discovers clients’ specific circumstances and tailors the process of helping them obtain a trade license to meet their needs. “An important part of the process is finding out about the expat’s specific business situation through a conversation about invoicing requirements. For example, if they are invoicing another EU country, they need to register for VAT Light,” Jaroslava points out.

Jaroslava and her colleagues also help clients arrange all necessary health and social insurance in the most advantageous way possible. Jaroslava firmly advocates an individual approach to setting up these insurances: “You should never arrange health insurance electronically because your specific situation could lead to issues and complications if not recognized,” she warns.

“It’s much better for expats to go to the offices in person; usually, someone in the offices will speak English and be able to help you, whereas it is never possible to get any documents in any language other than Czech,” she adds.

HJ Taxes’ expertise in dealing with expat registrations stems from the fact that the company was formed 15 years ago in response to foreigners’ problems when dealing with the Czech authorities. Jaroslava enjoys working with the firm’s expat clients; “they always bring some new insights, and they’re not just a number for me – I care about helping them,” she says.

Many expats are tempted to navigate complicated Czech administrative procedures without such expert help – and without speaking the local language. According to Jaroslava, “problems often arise due to Czech-language correspondence from the authorities.”

“This correspondence is vitally important, yet expats often disregard or throw letters away. By ignoring such correspondence, they can incur major debt with, for example, social and health insurance providers,” she warns.

Correspondence can only be received in Czech, so having help from a local is indispensable for many applicants.

HJ Taxes also solves other common headaches. Securing a “business seat” for your work activity is a prerequisite to getting a trade license, but for expats who do not own their own home in Czechia, this can cause major complications.

“Not every landlord is willing to approve a business seat in their property. We cooperate with places that provide the possibility of hosting your business seat, fulfilling this necessary part of the process, without which you won’t obtain your trade license,” Jaroslava explains.

Applying for a trade license is arduous for those going it alone. However, With HJ Taxes, expats can focus on their work, confident that their application is in expert hands.

“Expats must provide us with documents when we do not have the power to get them independently. But after gathering all the documents needed, they don’t need to participate in the process,” explains Jaroslava.

Clients receive copies of all correspondence to keep them in the loop. Each piece of documentation is explained in full, and any necessary actions are clarified. The entire process, including registration for social and health insurance, can take up to two months to complete.

Once they have obtained their trade license, expats can stick with HJ Taxes to simplify their accounting or cancel their power of attorney and take over management of their own affairs. Saved the headaches and hassle of setting up a trade license, they can focus fully on their work and pursue the opportunities of doing business in Czechia.