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How to Set up Business in the Czech Republic

Foreign legal entities are allowed to conduct trade activities, including acquisition of real estate, under the same conditions and to the same extent as Czech companies.

Business Entities

Czech Republic officially recognises the following types of business entities, the most common are limited liability companies (s.r.o.) and joint-stock companies (a.s.). The trade name of the company must be unique. For more information, please visit the Businessinfo portal


Limited Liability Company (s.r.o.)

SRO’s are the most common company typeestablished in the Czech Republic. Like in many countries, partners in an SRO are liable for the company’s obligations only up to the capital they originally contributed to the company. In the Czech Republic, SROs are required to start with a minimum registered capital of CZK 200000.


Joint Stock Company (a.s.)

A founding contract, including the company’s statutes, and an issue of shares establishes an AS. Shares can be freely traded without registration in the Czech Republic’s Commercial Register, which makes it attractive if you plan to make your company publicly traded. A Joint Stock Company must have a minimum capital stock of CZK 2 million. At least 30% of that amount must be paid at the time of incorporation.


General Commercial Partnership (v.o.s)

In a VOS, two parties trade under a joint name, and are equally obligated to and liable for the company, up to the amount of their individual contributions. Partners are liable with all of the property they hold, and the company is liable for all the property it holds.


Limited Partnership (k.s.)

A KS is a company in which all partners are liable for the company’s obligation up to the amount of their contributions as disclosed in the Commercial Register, paid or unpaid.


Joint Venture

Any of the previously listed business forms can be a joint venture, in which there are two partners, one of whom is typically a Czech resident.


Branch Office

A branch office isn’t technically a Czech business; just a representative of your foreign business in the Czech Republic. Branch offices have a pretty hefty set of restrictions, and must list all their planned activities on their Commercial Register application. The company must also appoint an office head who is either a Czech resident of a foreigner with a long-term Czech residency permit.


Taxes, VAT and other fees

If you establish a business in the Czech Republic, you can expect to pay two or three kinds of taxes:


1. Corporate tax- Currently 19%.

2. VAT- The standard VAT rate is 21%, however some products may be taxed at the reduced rate of 15% (mostly foodstuffs) or 10% (infant nutrition, medicine, books).

3. Road Tax- Applicable only if you plan to use a motor vehicle in your business. Road tax rates are variable, but fall between CZK 1000-5000 annually.

Here, you can find up-to-date information on taxation in the Czech Republic.


You can find more information on setting up a business in the Czech Republic in the attachments or on the CzechInvest portal


How to set up a business in the Czech Republic? 499 KB PDF (Adobe Acrobat document) Jul 25, 2018