“I'm not running a business, I'm just renting out my apartment through Airbnb.” I've heard this sentence many times, and I used to say it myself. The problem is that neither the živnostenský úřad (Trade Licensing Office), nor the finanční úřad (tax office), nor a court accepts it. What decides is the substance of what you do.

Lease vs. accommodation service

A lease is passively handing over an apartment for months and years. The tenant lives their own life; you don't make their bed.

An accommodation service means days and weeks, cleaning between guests, bed linen, towels, listing on a platform, reviews. The Czech General Financial Directorate classifies it under code 55 of the CZ-CPA classification — the same as hotels. Anyone offering an apartment by the night on Airbnb is providing an accommodation service. That isn't an opinion, it's the established interpretation.

What follows from this

The difference changes everything:

That last row comes as a surprise: the Act on the Residence of Foreigners also treats a relationship based on a lease agreement as accommodation. Anyone who rents an apartment to a foreigner, including an EU citizen, is an accommodation provider and reports them to the cizinecká policie (Foreign Police) within 3 working days. It's the only obligation that also applies to a classic lease.

A seasonal operation doesn't need a trade license?

It does. A trade is a continuous activity carried out for profit. An apartment you repeatedly offer on a platform is operated continuously even if you only rent it out during the summer holidays. Operating without a trade license can mean a fine of up to CZK 500,000; on a larger scale, it's a criminal offense.

Why it pays off tax-wise, too

This is a paradox few people expect. Tax-wise, Section 7 is often more advantageous than Section 9. Flat-rate expenses are 60% instead of 30%, and the cap is CZK 1,200,000 instead of CZK 600,000. Anyone who taxes short-term accommodation as a lease isn't just taxing it wrongly, but often paying more. During an audit, the tax administration will reclassify it under Section 7, assess the tax three years back with a 20% penalty, and the ČSSZ (Czech Social Security Administration) and the health insurance company will each collect their contributions separately.

The only tax disadvantage of an accommodation service is the insurance contributions. But as a side activity alongside employment, they're significantly lower.

How to get a trade license in one afternoon

A notification at any Trade Licensing Office, at a Czech POINT, or electronically at rzp.gov.cz. The fee is CZK 1,000, or CZK 800 electronically. No exams or experience required. The license comes into existence on the day of notification, and the extract arrives within 5 working days. With the same form, you notify the ČSSZ and your health insurance company that you're starting the activity. The state sets up a datová schránka (data box, the Czech official e-mail system) for you automatically.

Then all that remains is to register the apartment as business premises, mark it with a sign and — if you're not the owner — have the owner's consent to do business there.

Sole trader or straight to an s.r.o.?

One apartment and income up to roughly a million crowns a year: sole trader. Several apartments, sublet apartments, a business partner or plans to hire staff: consider an s.r.o. (Czech limited liability company), mainly because of liability, not taxes. The difference in contributions is small. A detailed comparison with calculations is in Help.