Are you a holder of a trade licence and operate your business in the Czech Republic? Prick up your ears! As every year, there are adjustments related to the social security and health insurance mandatory payments. Since 2020 is about to step in, we’re here to update you in that aspect. All the changes apply to both Czech citizens and expats.
The ČSSZ (Czech Social Security Administration) contributes to the national budget with more than one third and it covers social security issues for over 8,5 million clients. Basically what ČSSZ does is to collect and enforce payable social security premiums. That includes pension insurance, sickness insurance and a contribution to the state employment policy.
The changes on social insurance for the self-employed come to effect at the beginning of January 2020, increasing from 2388 CZK to 2544 CZK. You can execute payments between January 1st and the last day of the calendar month. This will ensure the exact month when the contribution was paid.
If you are an employee and at the same time you possess a trade licence during your employment, you don’t have to pay insurance during the year (each month), but you still have to pay social security (to ČSSZ) which will be 1018 CZK per month in 2020.
Besides the changes on ČSSZ there are also new updates on the price for VZP (General Health Insurance Company in the Czech Republic).
For 2020 the minimum advance on health insurance for self-employed people will increase from 2208 CZK to 2352 CZK ; therefore, you have to pay this amount every month, until the 8th day of the following month, for example, you’ll have to pay 2352 CZK in January until the 8th of February.
According to the national law and the European Social Security Coordination Rules (EU Regulation 883/2004 and 987/09), the Czech Public Insurance covers:
- all Czech citizens;
- employees of employers based in the territory of the Czech Republic;
- self-employed people from other EU countries – active in the territory of the Czech Republic and covered by the Czech social security legislation;
- employees from other EU states working on Czech territory for employers that are based in other EU country, if they are covered by Czech social security legislation;
- non-active family members of migrant workers from other EU states insured in the Czech Republic
All the yearly changes happen due to the increase (or decrease) of the Average National Wage (in the third quarter of 2019, the Czech Republic’s Average National Wage was 33 697 CZK/month – gross salary).
In case, after reading this article, you still have some questions, feel free to contact our team and present your doubts to us. Additionally, if you need help with your health insurance check our ultimate service!