In connection with the Senate’s legislative measure, a number of new rules will become effective in 2014 that were originally to take effect in 2015, as they were related to tax reform legislation (Act No. 458/2011 Sb., on the Amendment to Acts related to the Establishment of a Single Collection Point). Some of these new rules also affect the Reserves Act in that they simplify the requirements for creating adjustments to receivables under Section 8a (adjustment to non-statute-barred debts due after 31 December 2004).
The current system of six ranges will be replaced by two ranges. Depending on the maturity period, statutory adjustments will be divided into two groups only:
- Where more than 18 months expire from the end of the agreed maturity period for a debt, the adjustment can be created for up to 50% of the outstanding debt
- Where more than 36 months expire from the end of the agreed maturity period for a debt, the adjustment can be created for up to 100% of the outstanding debt.
At the same time, debts with an initial balance sheet value of up to CZK 200,000 and with a value above this limit will no longer be distinguished.
However, stricter rules will apply to debts acquired by assignment. Under the new laws, arbitration, judicial or administrative proceedings will have to be initiated in respect of debts exceeding CZK 200,000 so that statutory adjustments can be created for them in compliance with the above conditions.
There will be plenty of time to adapt our accounting software to these changes. This is because, under the transitional provisions, the new rules are to be applied for the first time to debts arising from the effective date of the legislative measure. Therefore, the first new statutory adjustments will not be calculated until preparation of the 2015 tax returns.