Czech Republic

The Czech Republic introduced Value Added Tax regime in 1993, in preparation for its accession into the European Union in 1994.  It is known as Dan z pridane hodnoty locally.

The Czech VAT rules are contained within the 1994 VAT Act.  The incorporates the main requirements of the EU VAT Directives, which the Czech Republic is obliged to follow as a member of the EU.  This includes the rules for Czech VAT registration, returns and compliance.

The Ministry of Finance oversees the consumption tax regime, and issues regular guidance briefings and instructions in support of the VAT Act.

Should you register for Czech VAT?

Foreign companies offering local goods or services may be required to register for Czech VAT.  As with the rest of the EU, the common situations triggering a registration include:

  • Importing goods into the Czech Republic
  • Intracommunity sales (dispatches) or purchases (acquisitions) of goods from other EU member states
  • Trading, buying and selling goods in Czech Republic
  • Holding goods under consignment stock arrangements in the Czech Republic for sales to local customers
  • Internet retailing goods to Czech consumers, subject to a local distance selling threshold
  • Running live events, exhibitions or conferences with paid admission on the door
  • If a company is otherwise a non-VAT trader, but is receiving services in Czech Republic under the reverse charge rule.
  • The self supply of goods.

Following the implementation of the 2010 EU VAT Package, there are very few situations which require foreign companies providing supplies of services in the Czech Republic to register for VAT.

Note that providers of electronic, broadcast or telecoms services to consumers in the Czech Republic only have to VAT register in one EU country under the MOSS scheme to file a single return covering all 28 member states.

If you do need to VAT register, read our Czech VAT registration briefing to understand the requirements, including any VAT registration thresholds that may apply.

There may be further exemptions from the requirement to VAT register in Czech Republic that you should consider.  Please read our Czech VAT Reverse Charge briefing.

Latest Czech news

EU moves new B2C VAT liabilities to marketplaces 2021

December 12, 2018

On 12 December, the European Commission published details of a new rule which would make large online marketplaces responsible for calculating, collecting and remitting VAT on certain B2C cross-border transactions below €150. Where goods are imported by an EU or non-EU merchant, and then sold via a marketplace in another EU country..

Czech 10% reduced VAT rate changes

June 14, 2018

The Czech Ministry of Finance has proposed changes to goods which will be subject to its reduced VAT rates of 10%. The current standard...

VAT Reporting update 18.4.1

May 1, 2018

Overview This release is a maintenance release of the VAT Reporting application for the month April. It includes changes to reports, modifications and bug....