Press Advisories

31. 3. 202020:31

Government approves CZK 25 000 for self-employed persons, also launching programme for supporting employment retention

One-time assistance of CZK 25 000 for the self-employed, covering the majority of wage costs for employers affected by the government regulations and consequences of the coronavirus crisis, and a proposal to help people facing distraint. At a meeting on Tuesday 31 March 2020, the government of Andrej Babiš approved another bundle of measures to help those hit hardest by the pandemic.

Self-employed persons who prove that they have been economically damaged by the government's exceptional measures or other consequences of the coronavirus pandemic and meet other conditions will receive one-off financial aid of CZK 25 000. Andrej Babiš's government approved the payment of this sum, which will not be subject to taxation or other deductions, at the proposal of Finance Minister Alena Schillerová. The relevant implementing act on a compensation bonus in connection with crisis measures related to the incidence of coronavirus SARS CoV-2 must still be approved by Parliament in a state of legislative emergency.

Among other things, sole traders as well as say artists, interpreters, small farmers, tax consultants and other persons who are self-employed will have to attest on the application in the form of a solemn declaration that in the period between January and March 2020 they lost at least ten percent of their gross revenue compared to the same period in 2019 and that last year they reached a gross income of at least CZK 180 000, or the equivalent of at least CZK 15 000 a month if they did not do business the whole year.

Self-employment must also be their primary work; it is only allowed as a secondary activity for those collecting disability or old-age pensions, for parents collecting parental allowances or maternity benefits, or if the person in question was taking care of a person in need. You can find the details in the Finance Ministry's press release (in Czech language).

The government also approved the final form of the Antivirus employment protection programme, which was prepared by the Ministry of Labour and Social Affairs. This programme is meant to help employers retain employees during this time of lost revenue. Via the Czech Labour Office, the state will compensate their wage costs based on the manner in which their company was affected and what status their employees currently have.

The amount of compensation for employers is derived from the average "super-gross" salary and depends on the reasons which prevent the employee from working.

Companies must fulfil several conditions, for example strict observance of the Labour Code, the employees must not have given or been given notice, and wages and deductions must be paid. They must also attest that the problems arose in connection with COVID-19. More details about the Antivirus programme are in the press release of the Ministry of Labour and Social Affairs (in Czech language).

The government has also approved a draft act on several measures to mitigate the impact of the coronavirus SARS CoV-2 epidemic on persons involved in court proceedings, damaged parties, victims of crimes and legal persons and on a change to the insolvency act and execution code, which was presented by the minister of justice. The new act is meant to alleviate persons who have been unable to live up to their commitments as a result of the preventive measures adopted by the government and other consequences of the coronavirus crisis, and cabinet will want Parliament to approve it in a state of legislative emergency.

Among other things, the new legislation will allow missed deadlines to also be forgiven in cases where it is not possible under the current act. It defers the obligation of debtors to submit an insolvency proposal on themselves if they are in bankruptcy for up to six months after the government's extraordinary measures have expired. No account will be taken for creditor proposals submitted up to 31 August 2020. The proposal also seeks to do away with the thirty-percent threshold for paying off debts in debt relief approved before 31 May 2019 if the debtor has been unable to pay due to the epidemic. Alleviation also applies to distraint, with the proposal allowing for forgiveness of missed deadlines and suspension of fruitless distraint, which is of no benefit to any of the parties. More on how to deal with distraint and insolvency can be found on the Ministry of Justice's website (in Czech language).

Based on an agreement between the minister of industry and trade and minister of agriculture, the government also approved an expansion of the declared Care Allowance for the Self-Employed programme to include self-employed persons that do business in the field of agriculture and the forestry industry. If, during the government's extraordinary measures prohibiting school attendance, they have taken care of children under 13 or dependent children of up to 26 years of age that rely on at least Level I assistance of another person, they can also request a compensation contribution of CZK 424 a day.

The government also decided to extend the crisis measure that forbids municipalities from charging for parking zones in cities and villages. The measure, which was to have expired 1 April, will now last under the end of the state of emergency.

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