- VAT Structure and Rates: The Czech VAT system follows the EU VAT Directive, imposing a standard rate of 21% on most goods and services, and a reduced rate of 12% for specific items such as restaurant services and certain foodstuffs. Registration is mandatory for resident businesses exceeding CZK 2,000,000 in annual turnover, while non-resident businesses must register regardless of threshold.
- Filing and Compliance Obligations: VAT filing deadlines are set for the 25th day of the month following the reporting period, with monthly and quarterly options available. Businesses must also comply with digital reporting requirements, submitting transactional data electronically to tax authorities via the VAT Control Statement.
- E-Invoicing and Digital Services: E-invoicing is mandatory for public sector suppliers, requiring specific details such as VAT rates and unique invoice numbers. VAT on digital services, charged at 21%, applies based on the consumer’s location, with specific exemptions for educational or public interest purposes. The reverse charge mechanism is used for B2B sales, shifting VAT accountability to the buyer.
Source VAT IT Compliance
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