Compensation bonus for self-employed persons

After the approval of the targeted “Antivirus” Programme for Support of Employment, another act has been approved, which reduces the economic impact caused by the COVID-19 disease. It is the act on compensation bonus in relation to the emergency measures related to the occurrence of the SARS CoV-2 coronavirus (hereinafter “The Act” and “The Bonus”). The act took effect on 14 April 2020 by publication in the Collection of Laws.

The act aims at self-employed persons (hereinafter “self-employed persons”, the Czech abbreviation is “OSVČ”).

Conditions for obtaining to bonus

  • the performed activity is a primary one; in case of performing secondary activity, the self-employed person must not perform employment at the same time, which establishes participation in sickness insurance;
  • there also will be entitlement to the Bonus for an active self-employed person, who works based on an agreement to complete a job (DPP) with remuneration up to CZK 10,000 per month and based on a contract of services (DPČ) with remuneration up to CZK 3,000 per month;
  • The self-employed person was active as of 12 March 2020 or it is a self-employed person, whose activity was interrupted at any time after 31 August 2019 (seasonal business);
  • The self-employed person declares that he or she was fully or partly unable to perform this activity as a result of health risk related to the occurrence of the coronavirus or as a result of emergency measures of the government, especially due to the following reasons:
  1. the necessity to close down business premises or reduce their operation,
  2. quarantine of the self-employed person or its employee,
  3. looking after a minor in case of the self-employed person or obstacles in work of its employee consisting in looking after a minor,
  4. limitation of demand for products, services or other outputs or
  5. limitation or termination of supplies or services needed for the performance.

How does the Bonus combine with other programmes

With regard to the existence of other programmes for reducing the impact of emergency measures, it is suitable to know, which ones the Bonus can or cannot be combined with:

  • 6-month holidays regarding social and health insurance – YES, they can be combined;
  • Sick benefit – YES, they can be combined;
  • Caregiver allowance for self-employed persons – YES, they can be combined;
  • Old age pension, disability pension, parental allowance, maternity assistance or foster parent allowance – YES, they can be combined;
  • Unemployment benefits – NO, they cannot be combined. The Bonus cannot be paid in case of simultaneous use of unemployment benefits (assessed individually as of each calendar day);
  • Housing allowance and assistance in material need – the law does not explicitly rule this out, but the payment of the Bonus will be reflected as income when assessing entitlement to the benefit;
  • Tax relief (e.g. tax credit per taxpayer) – YES, they can be combined. The Bonus is not tax-eligible income and is not subject to social or health insurance. It will therefore not influence entitlement to tax relief in any way;
  • Entrepreneur with employees – YES, can be combined.

Basic information

  • The Bonus represents one-time assistance for the period of 12 March 202030 April 2020 reaching CZK 500 per every day, when the conditions of the Bonus are fulfilled.
  • The maximum amount of the Bonus reaches CZK 25,000.
  • For the time being, the Bonus is set down until 30 April 2020. If the emergency measures are not moderated, the period for provision of the Bonus may be prolonged.

How and where to request the Bonus?

  • A request for the Bonus can be submitted on an interactive form available here: https://ouc.financnisprava.cz/kompenzace/form/bonus
  • A request for the Bonus can be submitted by 29 June 2020 at the latest, otherwise entitlement to the Bonus lapses!

Authors: Veronika Odrobinová a Dominik Beran