Hourly rate calculator for Czech freelancers (OSVČ)

OSVČ (osoba samostatně výdělečně činná) is the Czech term for a self-employed person, typically a freelancer or sole trader working under a trade licence. On top of income tax, an OSVČ pays Czech social security insurance (pension and unemployment) and public health insurance out of their own profit, since there is no employer to cover them. This calculator rolls all of that into one simple percentage, so you can see the hourly rate you actually need.

How the hourly rate is calculated

Your hourly rate isn't "what I'd like per hour". It's what you have to charge so that after costs, insurance, tax and unpaid time you take home as much as you want. The calculator works like this:

Rate = (annual take-home target grossed up for insurance and tax + annual fixed costs) ÷ billable hours per year

The most common mistake is assuming you'll bill every hour you work. In reality a big chunk of your time goes to finding clients, admin, learning and your own marketing, and nobody pays for that. That's why a realistic freelance hourly rate comes out much higher than the hourly wage of an employee with the same take-home pay.

What Czech freelancers pay: social and health insurance

As an OSVČ in the Czech Republic you pay three things out of your profit: income tax, social security insurance (which funds your state pension and sickness and unemployment benefits) and public health insurance. Both insurances have a minimum monthly advance you pay even in a weak month. Many smaller freelancers use the flat tax (paušální daň), a single monthly payment that covers all three, or claim a flat-rate expense allowance instead of real costs. Because the exact share depends on your regime and income, the calculator uses one percentage you can adjust. Around 30% is a reasonable starting point to check with your accountant.

FAQ

How do I calculate my hourly rate as a Czech freelancer (OSVČ)?

Take how much you want to take home each month, add your fixed business costs, gross it up for insurance and tax, and divide by the hours you'll really bill in a year. This calculator does exactly that for you.

How much should I charge per hour?

There's no single universal number. It depends on how much you want to earn, what your costs are and how many hours you can really bill. For most freelancers the rate comes out much higher than they expect.

What are billable hours?

Only the hours you actually charge a client for. Finding clients, proposals, invoicing, marketing and admin usually aren't billed. For most freelancers only 50 to 70% of the time they work is billable.

Why is a freelancer's hourly rate higher than an employee's wage?

Because you have to pay insurance, costs, unpaid time, holidays and sick days out of it, which an employer covers for an employee. The same take-home amount therefore needs a higher rate when you're self-employed.

This calculator is for information only and is not tax advice. Insurance and tax are simplified, so check your exact numbers with your accountant. For more on marketing and running a business on your own, see my blog.