Trust Alone Won’t Secure a VAT Refund Claim

• The Supreme Administrative Court reaffirmed that trust in a supplier is not enough to secure a VAT refund; the taxpayer must prove what was actually received and who supplied it.
• A VAT deduction/refund can be denied if the business cannot substantiate the scope of services or the actual supplier’s identity, even if some work likely occurred and was used.
• Invoices and generic attachments, especially when combined with cash payments, may be insufficient evidence on their own; good faith cannot replace missing documentation.
• For significant or unusual purchases, taxpayers should retain contracts, purchase orders, acceptance certificates, work logs, delivery notes, correspondence, and other supporting records to establish who supplied what, when, and to what extent.
• During a VAT audit, taxpayers should explain what each document proves and respond promptly and specifically to the tax authority’s concerns; submitting documents without a clear explanation is inadequate.

Source: roedl.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.

---

---