VAT Registration in the Czech Republic
In order to register for VAT, taxpayers are required to submit an application to the Czech Tax Authority, which must be done electronically via the General Financial Directorate’s electronic Tax Portal. It is important to ensure that the application is submitted in the correct format, as any applications submitted in an incorrect format will be considered void.
A person must register for VAT if their taxable turnover exceeds the CZK 1,000,000 threshold within any 12-month period.
Learn all about VAT registration in the Czech Republic in our comprehensive guide below.
Register for VAT in the Czech
Republic
Republic
Individuals are obligated to register for VAT if their total taxable sales surpass the CZK 1,000,000 limit within any rolling 12-month period.
Once this limit is reached, the individual is deemed a VAT payer starting from the first day of the second month following the threshold breach. Registration for VAT is typically required for taxable persons in the following scenarios:
- A Czech Republic-based entity engages in a taxable transaction through its foreign establishment, where the transaction’s place of supply is in the Czech Republic.
- A foreign entity conducts a taxable transaction in the Czech Republic, and the recipient is not subject to tax.
- A foreign taxable entity, registered in a different EU Member State, supplies goods from the Czech Republic to a taxable person in another EU Member State.
Additionally, companies that provide or plan to provide taxable or VAT-exempt supplies with credit in the Czech Republic can opt to register as a VAT payer voluntarily, even if their sales turnover does not reach the stipulated threshold.
Established Entities in the Czech Republic Entities based in the Czech Republic must register as VAT payers with the tax authorities if their turnover exceeds 1 million Czech koruna (CZK) in any 12-month period.
Selling in the Czech Republic?
Registration process
Foreign Entities
For companies not residing in the Czech Republic, there is no set registration threshold. However, they are required to register as VAT payers if they conduct any transactions that are subject to Czech VAT (unless the VAT declaration and payment duties are transferred to the recipient of the supply) or if they are involved in the supply of goods from the Czech Republic to another EU member state.
Exemptions
Individuals who do not achieve the yearly turnover threshold required for registration, those conducting VAT-exempt transactions without the need to recover input VAT, and individuals not considered to be engaged in economic activities are exempt from the requirement to register for VAT.
Group and Divisional Registration
Grouping for VAT purposes is an optional choice in the Czech Republic, and not mandatory.
Registration Procedures
VAT registrants are required to apply for VAT registration with the Czech Tax Authority. These applications must be submitted electronically via the Electronic Tax Portal of the General Financial Directorate. It’s essential that the application is formatted correctly to be processed effectively.
The approval for registration and issuance of a VAT number can occur within 30 days or less. However, not having an assigned VAT number does not exempt an individual from the responsibilities of accounting for and paying VAT during the period of mandatory registration.
Taxable persons are also obligated to inform the tax administrator if the location of their primary management activities differs from the registered address provided in their VAT registration application. Furthermore, any changes to this address must be communicated to the tax administrator through the Application for Change of Registration Data.
Registration, Non-resident
If a non-resident company provides a taxable supply with the Czech Republic as the place of supply, and the purchaser is not responsible for the VAT payment (example due to reverse-charge mechanism), the non-resident company is typically obliged to register for VAT in Czech Republic.
A non-resident must also register for Czech VAT if it:
- Purchases goods in the Czech Republic from another EU Member State that exceed the intra-Community acquisition threshold, or if they are new means of transport or goods subject to excise tax.
- Engages in “distance sales” of goods and certain services.
- Is based outside the EU without fixed establishment in the EU, and supplies telecommunications, broadcasting, or electronically supplied services to non-taxable customers in the Czech Republic.
Distance Sales
The registration process for distance sellers within the EU and those selling low-value goods from outside EU can be simplified under the EU-wide “One Stop Shop” (OSS) regime.
Last Updated: 05/12/2023
Disclaimer
The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax
