How to start a company in Czechia in 7 days—and avoid mistakes that will cost you thousands

Starting a company in Czechia is a smart move thanks to low taxes, a strategic location, and a business-friendly legal environment. With the right support, you can get up and running in as little as a week.

But don’t rush it solo. Mistakes in your paperwork or company setup can lead to fines in the tens of thousands of crowns. Partnering with a specialist helps you avoid delays, stress, and costly errors.

We spoke to Eduard Malyarchuk, CEO of Nawi Europe, a company that supports expats with legal, tax, and banking services, to walk us through the process.

In almost all cases, before you can even register your company, you’ll need to secure a trade license. Known as a živnostenský list, this authorizes an individual or business to legally operate a specific trade or business activity.

According to act No. 455/1991 Coll., on Trade Business, applicants must submit all necessary documentation to the Trade Licensing Office closest to their registered business address. 

“We’ve seen countless instances of foreigners not knowing what to bring—or what to apostille or translate—for their trade license application. This delays the whole process significantly,” says Malyarchuk.

If you’re a foreigner, this will include an extract of your criminal record from your time in Czechia and your home country, which must be apostilled and translated into Czech. You must also submit notarized copies of your passport and visa/residence permit. With all documents properly submitted, you should get your trade license on the spot.

The most prevalent legal form for entrepreneurs in the Czech Republic is a limited liability company—in Czech, this is a společnost s ručením omezeným (or s.r.o). This offers limited liability protection and is governed by Act No. 90/2012 Coll. on Business Corporations. 

You could also set up a joint-stock company (akciová společnost, or a.s.), though this requires a minimum capital of CZK 2 million. An s.r.o requires only one shareholder or director, and an a.s. makes share transfers easier.

The founding document must be prepared in accordance with Act No. 89/2012 Coll., of the Civil Code. The document must include essential details like the scope of business activities, and information about shareholders and managing directors. All foundation documents must be written or translated into Czech and notarized by an authorized Czech notary.  

In most cases, this will either be a Memorandum of Association (společenská smlouva) for two or more founders or a simple Deed of Foundation (zakladatelská listina) if there is only one founder.

Registering is a legal obligation and an essential step in maintaining compliance and business credibility. If a company does not complete this registration, it could face serious fines and limits on what it can legally do. 

“Failing to properly register all beneficial owners can be fatal for a company—and knowing exactly who you should register and how is not straightforward. A trusted adviser can take you through all of the steps,” says Malyarchuk.

Under Czech law (Act No. 304/2013 Coll.), all companies must officially list their ultimate beneficial owners—meaning the individuals who truly control or benefit from the company—in the Register of Beneficial Owners. This helps improve transparency and supports efforts to prevent money laundering and other illegal activities. 

Reserving a business address (registered office) is a fundamental legal requirement for incorporating a company in Czechia. This address is where your company is officially domiciled and where government correspondence will be sent. 

It’s important to note that this is not necessarily where your business operates day-to-day; it’s really just a legal address for official matters. You may come across services offering “virtual offices,” and the costs will appear cheaper; however, this is a huge legal and financial risk, as your registered office must be a physical address in the Czech Republic to be valid.

“When it comes to choosing a physical or virtual address to base your company at, you need to consider important variables like costs and receiving correspondence properly. If, for whatever reason, you’re unable to receive official government correspondence, you could be in big trouble,” notes Malyarchuk.

Knowing which bank to choose to open your business account in Czechia—and when to do it—is a challenge foreigners face all the time, but it is essential for depositing registered capital (if over CZK 20,000), complying with tax laws and proving local presence. A managing director typically opens the account, requiring ID and foundation documents, but enlisting a specialist will greatly speed up the process and avoid major issues.

Pre-registration accounts are needed for higher capital contributions and include a deposit confirmation for the Commercial Register. Foreign documents must be translated and apostilled per bank policy. For an s.r.o, the minimum capital is CZK 1 per shareholder.

Adding your company to the Commercial Register (Obchodní rejstřík) officially brings your company into legal existence, after which you’ll receive your company’s IČO (identification number). You’ll need to submit a formal application along with supporting documentation, like proof of registered office and confirmation of paid-in capital. 

There are two ways to register: either physically at the relevant Regional Court (Krajský soud) based on your registered office address, or a Czech notary can submit your registration electronically via the notarial system—the latter is a much faster process.

After registering your company in Czechia, you must notify the local Financial Office within 15 days to register for corporate income tax and obtain a Tax ID (DIČ). On top of this, VAT registration is mandatory if your turnover exceeds CZK 2 million in 12 months or if you engage in EU trade or cross-border services. You can also register voluntarily even if you don’t reach the turnover threshold.

Starting a business in Czechia is straightforward—but only if you do things by the book. From licenses to bank accounts, a trusted adviser can help you avoid mistakes and save serious time and money.