Dear Readers,
Please be informed that a draft decree whereby certain regulations on form submissions for 2024 are changed was published on the website of the Government of the Czech Republic (see here). Many of the changes relate to the consolidation package that is currently going through the legislative process. You can find below the anticipated changes, namely in connection with VAT. We prepared a summary of anticipated changes for you in this article.
VAT Return and Inspection Reports
With the anticipated effect from 1 January 2024, supplies of books (that meet the definition pursuant to the amended VAT Act) will newly be exempt from VAT (with an entitlement to tax deduction; new Section 71i). Such supplies will be disclosed in row 26 under the decree.
This correction will be disclosed in row 45 of the return as a result of changes in tax deductions in passenger vehicles (new Section 77a).
Only two VAT rates are likely to be applied from 1 January 2024: the basic rate (21%) and the reduced rate (12%). Discussions were held in this context, namely on how inspection reports will reflect those changes. Under the draft decree, columns showing the VAT rate should remain unchanged (i.e. three columns for three rates), in order to provide for continuity of the situation before the amendment’s effect. As a result, supplies subject to the reduced VAT rate (12%) should be presented in the column originally intended for the first reduced VAT rate (15%).
CESOP
Effective from 1 January 2024, payment service providers will have new obligations in relation to registering cross-border payments and recipients thereof and reporting such payments to the tax administrator. We informed you about this topic in our previous article. The bill was approved by the Chamber of Deputies in the third reading; at present, proposed amendments and legislative and technical corrections are being processed and the bill will be subsequently included in the agenda of the Senate’s meeting.
The decree also includes a new template of the form submission for the CESOP (Central Electronic System of Payment Information) notification due to that change, which is not part of the consolidation package.
If you would like to have more information on this topic, please feel free to contact us. We will be happy to help you.
Michaela Kozminská
kozminska@edmutilitas.cz