New VAT Deduction Obligation for Unpaid Liabilities Effective July 2025: Key Changes Explained

• New VAT obligation effective from July 2025 for unpaid liabilities over six months past due.
• Significant change due to EU Court decision: return claimed VAT on unpaid invoices after six months.
• First applicable period is July 2025; guidance issued by General Financial Directorate.
• Applies to taxable supplies received from January 1, 2025.
• VAT adjustment made in the tax return for the period when the six-month deadline passes.
• If the debtor later pays, they can reclaim the corresponding VAT amount.
• Example: If a customer pays only 80 percent of an invoice, they must return 20 percent of the claimed VAT.
• Quarterly taxpayers are exempt from reducing VAT deduction if payment is made by the end of the relevant tax period.
• VAT adjustment reflected in both the VAT return and control statement.
• In the VAT return, reduction is shown on line 40 or 41 with a negative sign and on line 34 with a positive sign.
• In the control statement, adjustments are always reported in section B.2, even for transactions under 10,000 CZK.

Source: accace.cz

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

---

---