How to Start a Business in Prague as a Foreigner
Updated: Oct 1
All articles in: Business in the Czech Republic | All topics
Starting a business in Prague can mean several different things.
You may operate as an OSVČ.
You may establish an s.r.o.
You may operate through another corporate structure.
Or you may expand an existing foreign company into Czechia.
The correct structure depends on the business.
OSVČ
OSVČ is often considered by freelancers and individual professionals.
It can be relatively simple administratively, but the entrepreneur carries the business personally and must manage tax and insurance obligations.
s.r.o.
A Czech s.r.o. is a separate legal entity.
It may make sense for:
partners;
larger contracts;
employees;
commercial risk;
investors;
or a business that needs a corporate structure.
The minimum legal capital requirement is not the same as the amount a business actually needs to operate.
Business structure and residence
This is especially important for Israelis.
You can establish or own a Czech company without that fact alone creating a long-term right to live and work in Czechia.
The corporate plan and immigration plan should therefore be considered separately and then connected.
The practical sequence
A sensible starting framework is:
business model → legal form → activity/licence → registered address → banking → accounting/tax → immigration
The exact order can change depending on the case.
Do not register a company before understanding why you need one
A company creates obligations.
There can be:
accounting;
annual filings;
tax obligations;
banking;
registered-office requirements;
corporate records;
and professional fees.
If an OSVČ structure is sufficient, an s.r.o. may add unnecessary complexity.
If the business needs a company, however, the extra structure can be justified.
A-Z GRP
A-Z GRP helps Israeli entrepreneurs understand the practical choices before they start paying for setup.
We coordinate the process and connect clients with Czech notaries, accountants, lawyers and other specialists when their expertise is required.
The best company structure is the one that matches the business, not the one that simply sounds more impressive.
