Czech Republic: Measures on VAT group registrations | KPMG | GLOBAL

Czech Republic: Amended measures on terminating VAT group registrations

Czech Republic: Measures on VAT group registrations

An amendment to the value added tax (VAT) law—effective 1 July 2017—accelerates the process of terminating VAT group registrations.

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Under these legislative changes:

  • The tax administrator can cancel the group registration before the end of the calendar year if: (1) a VAT group no longer satisfies the VAT group statutory requirements; or (2) the tax administrator learns that none of the VAT group members satisfies the VAT group membership criteria. 
  • If a VAT group member determines that the group no longer meets the criteria, the member must immediately report this fact to the tax administrator. The tax administrator then can issue a ruling that cancels the group’s VAT registration.

 

Read a September 2017 report prepared by the KPMG member firm in the Czech Republic

Liability for VAT, unreliable suppliers

The number of “unreliable payers” of VAT has been reportedly growing significantly. The VAT law imposes a duty on the supply recipient to be liable for amounts of VAT that is not paid by a supplier if the fact that the supplier is an “unreliable payer” was made public as of the date of supply or as of the date when consideration was provided. 

The critical date is the moment when this information was made public. Supply recipients are also liable for VAT unpaid by suppliers if they make payments to unregistered bank accounts.

 

Read a September 2017 report prepared by the KPMG member firm in the Czech Republic

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