Reprieve for freelancers: Czechia set to roll back social insurance payments

Freelancers in Czechia are set to see their social insurance contributions return to last year’s level after the Chamber of Deputies supported a government-backed proposal late last week. The measure would reverse a planned increase in the minimum monthly assessment base, which had briefly raised contributions earlier this year.

The legislation could provide relief to many self-employed workers by reducing monthly payments and refunding any overpaid amounts from the start of 2026. According to Finance Minister Alena Schillerová, the minimum monthly contribution will drop from CZK 5,720 to CZK 5,005, saving individual contributors roughly CZK 715 per month.

The proposal, first submitted by the governing coalition in early November, faced initial opposition from KDU-ČSL and STAN, which argued the bill warranted a full committee review. Tom Philipp, head of the KDU-ČSL parliamentary group, noted that the amendment could affect the future pensions of self-employed individuals.

Critics warn the rollback could strain the pension system over time. Former Labour Minister Marian Jurečka estimated the measure would reduce annual contributions by CZK 3.5 billion, potentially leaving some self-employed people dependent on state support during retirement. Minister of Labour Aleš Juchelka argued the system could absorb up to a CZK 2 billion shortfall.

The increase in social contributions was introduced under a 2023 consolidation package by the previous Fiala government, which gradually raised the minimum assessment base from 25 percent to between 30 and 40 percent of the average wage for main-income self-employed.

Secondary-income contributors saw a one-percentage-point rise to 11 percent. The new proposal freezes these rates at last year’s levels for 2026.

The measure applies to those whose self-employment constitutes their primary source of income. Contributions already paid at the higher rate earlier this year will be considered prepayments and refunded after the end of the year, the Ministry of Finance confirmed.

The rollback aligns with commitments made by coalition parties ANO, SPD, and Motorists during early government negotiations. It also reflects broader debates across Europe on balancing support for self-employed workers with pension system sustainability, as countries reassess social contribution structures amid inflation and wage growth.

For self-employed individuals, the legislation could ease short-term cash flow pressures, reduce monthly expenses, and provide predictability in financial planning. Housing, healthcare, and other monthly costs may be easier to manage with lower contributions, particularly for those running small businesses.

The bill now moves to committee discussions before returning for further readings in the lower chamber. Lawmakers will continue to debate its potential long-term effects on pensions and social security sustainability.