What is Czech VAT registration? Czech VAT registration review

1. Czech VAT rate

1) Preferential rate (R2), the rate is 10%, the products involved are periodical publications, maps, candy, flour, scones, non-carbonated water, etc.;

2) Preferential tax rate (R), the tax rate is 15%, the products involved are printed books and pamphlets, ordinary food, tablets and capsules, nutritional drinks, adult diapers and urinary incontinence aids, bulb plants, plant seeds, maternal and child and child car seats, etc.;

3) Standard tax rate (S): 21%, a commonly used tax rate for cross-border e-commerce, covering most products.

Pursuant to the VAT Act, Coll. No. 235/2004, the Czech Republic amended the VAT Act and issued new VAT rules for foreign companies. The notification on the new VAT rules for non-Czech companies will focus in particular on obligations regarding the long-distance sale of goods.

2. The Act requires non-Czech companies to register for a Czech VAT number in the following circumstances

1. Your company is established outside the Czech Republic and stores the goods in the Czech Republic and sells them to buyers

2. You sell goods remotely from other EU countries to Czech buyers and these sales exceed CZK 1,140,000 in the current or previous year

The distance selling threshold in the Czech Republic is 1,140,000 Czech crowns. If the distance selling threshold is exceeded, Czech VAT must be applied. Another benefit of applying Czech VAT is that because of the Central European Scheme (CSS), products stored in warehouses in Poland and the Czech Republic are shipped to German customers at a discount of 0.45 pounds in logistics and distribution costs compared to products stored in warehouses in Germany.

3. What information do I need to provide to register for a Czech VAT number?

The Czech Tax Office will ask you to fill in the appropriate forms and provide the following documents:

1. VAT certificate (need to prove that your business has registered for VAT in other parts of the EU)

2. Business license

3. Identity documents of legal person, etc.

4. Czech VAT tax number format

Country code: CZ

Tax ID format: CZ 123456789 (9 digits)

Czech VAT declaration

The standard reporting method in the Czech Republic is monthly reporting

Czech application deadline: 25th of the following month

Sellers are required to remit the VAT due to the Czech tax authorities’ bank account before this deadline.

5. Under what circumstances will a fine be incurred?

Foreign companies may be penalized for misdeclaring or missing a return. Late filing or failure to register for VAT will result in a fine calculated based on possible loss of revenue, up to a maximum of CZK 300,000.

Under-declaration or non-declaration will result in a penalty of 20% of the additional tax burden. In addition, overdue VAT payment will be charged interest at the repurchase rate set by the National Bank + 14%, and the interest will only be charged for five years.

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