VAT in the Czech Republic
In the Czech Republic, VAT, locally known as “Daň z přidané hodnoty (DPH),” is an indirect tax on consumption. It is applied to the added value of goods and services at different stages of the supply chain.
The Czech Republic is part of the EU VAT system and the EU single market economy. The VAT framework in each EU member state is based on the VAT Directives issued by the EU, which override local laws. In the Czech Republic, VAT administration is managed by the Tax and Customs Authorities, with the Moravian-Silesian Tax Authority responsible for entities outside the Czech Republic.
Everything you need to know about VAT registration, returns, Tax Representation (if applicable), and your legal duties in the Czech Republic is conveniently located right here!
Selling in the Czech Republic?
Introduction to VAT in the Czech Republic
Value Added Tax (VAT) is a prevalent tax imposed on most transactions between businesses and consumers within the European Union (EU) member states, including an expanding number of other countries. For seamless cross-border trade, it’s crucial that businesses adhere to compliant VAT registration, ensure accurate and timely fulfilment of VAT responsibilities, and understand their legal obligations regarding VAT registration, returns, and Tax Representation (if required), particularly in the Czech Republic.
Scope of Taxation
Economic activity encompasses both autonomous business operations and the ongoing use of physical and intangible assets for income generation, which also covers professional practices. As per Article 2(1) of the Czech VAT Act, transactions subject to taxation include:
- Goods supplied for consideration by a taxable person in their capacity as such, with the place of supply being in the Czech Republic.
- Services provided for consideration by a taxable person in their capacity as such, which the place of supply being in the Czech Republic.
- Intra-Community acquisitions of goods or services made by a taxable person or non-taxable legal person, and the purchase of new means of transport from another EU member state for consideration by a non-taxable person.
- Importation of goods into the Czech Republic.
Taxable persons include:
- Independent organizations engaged in economic activities.
- Non-commercial entities, like public bodies, involved in economic activities that have commercial competition.
Czech Republic – General VAT information
| Tax authority | Ministry of Finance of the Czech Republic |
| VAT in local languages | “Daň z přidané hodnoty (DPH)” |
| Currency | Kč CZK |
| VAT number format
|
CZ+8 digits for legal entities CZ+ 9 or 10 digits for entrepreneurs |
| CZ12345678 CZ123456789 CZ1234567890 |
|
| VAT rates
|
Standard 21%; Reduced 12% |
| Zero-rated (0%) and exempt | |
| Frequency | Monthly or quarterly |
| Thresholds | |
| Registration | |
| Established | CZK 1,000,000 |
| Non-established | None |
| Intra-Community acquisitions | CZK 326,000 |
| Intra-EU Distance sales and electronically supplied services to consumers (OSS) | CZK 258,000 (EUR 10,000) |
| VAT Group | Allowed – It is available but not mandatory |
| Voluntary Registration | Available – If the total taxable turnover is above the registration threshold of 2 million Czech koruna in a year. |
| Recovery of VAT by non-established businesses | Yes |
| Compliance Returns and Deadlines | |
| VAT Return | 25th day following the end of the filing period |
| Frequency | Monthly, quarterly |
| EC Sales List | 25th day following the end of the filing period |
| Cumulative Statement | 25th day following the end of the filing period |
| Electronic Invoicing | It is mandatory within a B2G context only. |
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