GFŘ Guidance on VAT Deduction Changes Effective January 2025: Key Updates and Practical Examples

• The General Financial Directorate (GFŘ) issued information on changes to VAT deduction entitlements effective from January 1, 2025, clarifying partial deduction rules and summarizing other changes.
• Clarifications address cross-border transactions for small businesses exempt from VAT, emphasizing the need to adjust deduction entitlements and include such transactions in the calculation of the deduction coefficient.
• The information covers changes regarding the acquisition of selected personal vehicles, deadlines for claiming VAT deductions, deduction rights upon VAT registration, and requirements for detailed records of long-term assets.
• The most significant changes concern partial VAT deduction for long-term assets used for mixed purposes, requiring mandatory corrections in the year of asset activation, with the previous 10% tolerance threshold abolished.
• For other supplies, correction rules remain unchanged, and for proportionally reduced deductions, settlement is based on the coefficient for the year of asset activation.

Source: danovky.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.

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