Payroll Accounting 2026: What Changes and How to Prepare

Payroll accounting is one of the most demanding areas in every company. Legislation changes each year, contribution rates get updated, and the payroll accountant must stay constantly up to date. This article summarises what payroll accounting looks like in 2026, the role of the payroll accountant, and when it makes sense to consider an external payroll accountant.

Payroll accounting is more than just salary calculation. A complete payroll agenda includes: - Calculating gross and net wages, overtime, allowances and bonuses - Processing sick pay, holidays and compensation - Social security, health insurance contributions and income-tax withholding - Reporting to the Czech Social Security Administration, health insurance companies and the tax office - Annual tax reconciliation, pension insurance record sheets - Maintaining payroll ledgers and document archiving Quality payroll accounting must comply with the Labor Code (Act No. 262/2006 Coll.), the Income Tax Act and social and health insurance regulations.

- Increase in the minimum wage — affects the minimum guaranteed income calculation and thresholds for withholding tax. - Update to the maximum assessment base for social security contributions — the cap on contributions for high earners changes. - Continued unification of reporting duties for work-performance and work-activity agreements. - Broader electronic communication with public authorities (eNeschopenka sick-leave, data mailboxes, MPSV portal). - Ongoing push for digitised payroll processes and electronic payslips. Specific numerical values should always be verified directly with the Czech Social Security Administration and the Ministry of Finance, as they can be refined during the year.

- Collecting attendance, holiday and sick-leave records - Running payroll calculations in payroll software - Reviewing, approving and dispatching payslips - Communicating with employees about pay-related queries - Preparing inputs for accounting and management reporting To deliver quality work, a payroll accountant needs regular training, access to up-to-date legislation and reliable payroll software. These three needs are the most common reasons why small companies move to an external payroll accountant.

For many companies, choosing between an internal payroll accountant and outsourcing to an external payroll accountant comes down to cost and risk.

- Full-time employee even for a company with 10 staff - Costs: salary, contributions, software, training, holidays, sick leave - Risk of downtime during holidays or illness - Suitable for companies with 50+ employees and a complex payroll structure

- You only pay for the volume actually processed - Substitutability — a backup team is always available - Legislative certainty — updates are part of the service - Suitable for companies from a handful up to hundreds of employees that don't want to tie internal capacity to payroll

The 2026 trend is clear: paper payslips are disappearing, payroll accountants work in the cloud, and employees access documents via a web portal. In practice this means: - Electronic signing of payroll documents - Employee self-service portal (payslips, holiday requests) - Automatic import from time-and-attendance systems - API integration between payroll software and accounting - Encrypted communication compliant with GDPR

- Your internal payroll accountant is leaving or has been on long-term sick leave - The company is growing and payroll is no longer manageable at the current scale - The company repeatedly faces fines or reassessments due to payroll errors - Management wants predictable payroll costs without fixed commitments - The company needs a modern employee portal it cannot run in-house

If you're deciding how to set up payroll accounting for 2026, start with an audit of the current state — how many hours per month internal payroll takes, what the downtime risk is, and which processes put the biggest strain on your payroll accountant. That's the basis for deciding whether to reinforce the internal team or switch to an external payroll accountant. We're happy to help with a non-binding analysis and a recommendation of the optimal setup — see our payroll outsourcing service. Reach out via the contact form and we'll arrange a short consultation.