Czech Payroll 2027: What’s Changing?

Czech Payroll 2027: Key Figures

First, the numbers. Here is a quick overview of the main payroll parameters currently expected for 2027.

Now, let’s look at what these figures actually mean.

1. Minimum Wage: CZK 24,900

The Czech minimum wage is increasing to CZK 24,900 per month, or CZK 148.30 per hour, from January 2027.

That’s CZK 2,500 more per month compared with 2026.

Apart from employees earning the minimum wage, this figure is also relevant for certain payroll calculations, including minimum health insurance contributions and eligibility for the child tax bonus.

Nothing particularly complicated here, but definitely one of the figures worth updating before January payroll.

2. Income Tax: Same Rates, New Thresholds

Czech personal income tax rates remain unchanged: 15% for income within the statutory threshold and 23% for income exceeding that threshold.

In 2027, the higher 23% rate applies to the portion of monthly taxable income exceeding CZK 154,989, or annual taxable income exceeding CZK 1,859,868.

3. DPP and DPČ: Updated Insurance Thresholds

If your company employs people under Czech DPP or DPČ agreements, there are two figures to remember for 2027.

These amounts determine when income from the respective agreements becomes subject to social security and health insurance contributions, according to the applicable rules. The principle remains familiar. It’s the numbers that need updating.

4. Social Security: A Higher Annual Cap

The maximum annual assessment base for social security contributions increases to CZK 2,479,824.

Once an employee reaches the applicable annual cap, social security contributions subject to that cap are no longer calculated on the excess. There is no equivalent annual cap for health insurance.

This is mainly relevant for employees with higher salaries or significant bonus payments.

5. Two Tax Reliefs Are Making a Comeback

Here’s something we haven’t seen in Czech payroll for a while. Two previously abolished tax reliefs are expected to return in 2027.

The student tax credit is expected to return at CZK 4,020 per year, subject to eligibility conditions.

The kindergarten allowance is also expected to return, with a maximum annual tax relief of CZK 24,900.

This allowance is relevant to annual tax reconciliation or an individual income tax return, depending on the employee’s circumstances.

For payroll teams, it means revisiting a couple of familiar items rather than learning something entirely new.

6. Employee Benefits: Updated Tax-Exempt Limits

Non-monetary employee benefits continue to have their own tax-exempt limits. For 2027, the expected annual limits are:

As usual, the tax treatment depends on the type of benefit and whether the statutory conditions are met. For employers offering flexible benefit packages, these are useful figures to have on the annual checklist.

7. DPP Taxation: A Different Approach from 2027

One change worth a little more attention concerns the taxation of DPP income.

The existing withholding tax treatment is set to change, with a special form of advance tax replacing withholding tax for relevant employment income.

Depending on the employee’s circumstances, this may also affect their annual tax obligations, including whether they need to file an individual income tax return.

The details are worth reviewing once the final rules and implementation guidance are available, particularly for employers with larger numbers of DPP workers.

8. What Should Employers Do Before January?

There is no need to reinvent the payroll process for 2027. A few straightforward checks should cover most of the changes:

• Confirm that your payroll provider has updated the statutory thresholds.
• Review DPP and DPČ settings, including the new tax treatment.
• Check employee benefit limits and relevant tax reliefs.
• Make sure the annual social security cap is correctly configured.
• Review the first payroll results of 2027, particularly where the new rules apply.

And that’s about it. A little preparation now should make the transition to 2027 much easier.

A Final Word

Czech payroll in 2027 isn’t getting a complete makeover.

Most of the familiar rules remain in place, with updated thresholds, a few tax adjustments and some returning tax reliefs.

For international HR, Finance and Payroll teams, keeping track of these changes is simply part of staying on top of Czech payroll. And that’s exactly what we’re here to help with.

FAQ: Czech Payroll 2027

Last updated: 18 October 2026. This article reflects the 2027 changes currently expected or announced. Some measures may still be subject to final legislative approval or implementation guidance. It is intended as general information, not individual legal or tax advice.