Czech Republic


New notification obligation regarding income paid abroad applicable as of the end of May

As we have informed you, most changes affecting income taxes that were adopted as part of the ‘2019 tax package’ will only enter into effect in 2020 or as of the tax period beginning after 1 April 2019. But if you have foreign relationships, there is one inconspicuous change that may also affect you – […]

European Court of Justice: Right to deduct VAT on fuel cards

In one of its recent judgements, the European Court of Justice (“ECJ”) has created uncertainty for a number of VAT payers. Those affected are taxable persons who use various fuel and similar cards to purchase fuel and naturally treat such transactions as a supply of goods (fuel) between a petrol station, a card provider/administrator and […]

European Court of Justice: Czech Republic excessively restricts the possibility of reducing VAT on bad debts

In one of its most recent judgments, the European Court of Justice (“ECJ”) was considering a dispute between a Czech VAT payer and the Czech tax administration regarding the possibility of adjusting (reducing) output VAT on debts owed by an insolvent debtor who ceased to be a taxable person. Under the Czech VAT Act, this […]

Tax package for 2019 already in effect

We wish to inform you that a package of tax measures for 2019 has been adopted. Some of the provisions came into effect on 1 April 2019. Value added tax Regarding VAT, there have been major changes in the corrections of tax base and VAT amounts. The main changes effective since 1 April 2019 are […]

Ground-breaking judgment of the Constitutional Court – VAT payers entitled to the refund of an undisputed part of excess VAT

In another ground-breaking judgment relating to taxation, the Constitutional Court has ruled in favour of VAT payers. The Constitutional Court has been more and more often considering disputes between VAT payers and tax authorities, where the tax authority has withheld the entire excess VAT while contesting only some performance and considering the other undisputed. In […]

Invitation to join us for a webinar: Brexit and the impact on VAT

With only a few weeks to go (effective date 29 March, 2019) and still no sign of an agreement between the United Kingdom (UK) and the European Union (EU), many tax authorities are gearing up for a hard Brexit. A “hard Brexit” means a number of things, but critically it means customs-controlled borders, which introduces […]

Do you finance your company using debt capital and deduct the financial costs from the corporate income tax base?

If so, we recommend acquainting yourself with the proposed amendment to the Income Taxes Act in sufficient time in advance. The amendment is currently before its second reading in the Czech Parliament’s Chamber of Deputies as the implementation of the European Anti-Tax-Avoidance Directive (as we informed you in our August newsletter) will bring a significant […]

Proposed amendment to the VAT Act – new rules for tax base corrections and VAT

In this newsletter you can learn about the proposed changes that will affect tax base corrections and VAT. The changes, which are to be brought by the draft amendment to Act No. 235/2004 Sb., on Value Added Tax (“VAT Act”), are expected to significantly affect all taxpayers wishing to issue a corrected invoice (tax document). […]

Have you published your financial statements in the Collection of Deeds?

If not, you face a risk of an administrative fine. Tax authorities have recently become more active in collecting the fine, as it does not require much effort. Do you know that the fine may be imposed not only by a commercial court but also by the tax authority? Companies are very well aware of […]

Transfer pricing audits – even tax authorities make mistakes

With increasing determination, tax authorities continue with their inspections of transfer pricing policies. Nevertheless, even they sometimes take unlawful steps we should all know about, either when preparing or later defending our transfer pricing rules. In one of its recent judgments, the Czech Supreme Administrative Court (“SAC”) stood up for a taxpayer and ruled that […]