You no longer meet the conditions
In the conditions for the flat-rate tax scheme include turnover not exceeding CZK 1 million, not being a VAT payer, no insolvency, and no concurrent employment subject to social and health insurance contributions.
So what happens if you stop meeting any of the conditions above?
You may be surprised, but nothing changes for you this year – you continue paying the same monthly amount of CZK 5,469 until the end of the year. A change only takes place the following year, when you must start making separate health and social insurance advance payments again.
Your only obligation is to notify your local tax office within 15 days of ceasing to meet a condition, using the termination form.
In the spring of 2022, you then file your tax return and insurance statements in the standard way, as if you had never been in the flat-rate tax scheme. The flat-rate tax payments are simply credited as advances paid towards tax and health and social insurance. You paid CZK 1,200 in tax advances (CZK 100 * 12), CZK 35,712 in social insurance advances (CZK 2,976 * 12), and CZK 28,716 in health insurance advances (CZK 2,393 * 12). Based on the actual figures, you will have either an overpayment or a balance due, which will then be settled by the institutions or by you. 🙂
You close your business or cease being liable for health insurance
You leave the flat-rate tax scheme at the end of the month in which you close your business or cease being obliged to pay health insurance because of a long-term stay abroad. Within 15 days of closing the business or the end of your health insurance obligation, you must notify the tax office that you are leaving the flat-rate tax scheme using the termination form. The final flat-rate tax payment of CZK 5,469 is due in the month in which those circumstances arise.
Although the duty to pay flat-rate tax ends, remember that in spring 2022 you must file a tax return and health and social insurance statements, where the flat-rate tax advances are credited towards the actual tax and contributions due.
You decide to leave voluntarily
Is the scheme no longer suitable for you, or do you know you will soon stop meeting its conditions? You can also leave voluntarily. However, remember that you cannot leave voluntarily during the year! You therefore submit a notification of termination of the flat-rate scheme by 10 January 2022, and the new conditions apply to you only from next year.
Does it seem complicated? Do not hesitate to get in touch and we will look at it together. 🙂