VAT registration in the Czech Republic

VAT (value-added tax) rates in the Czech Republic

The Czech Republic maintains a standard VAT rate of 21%, in addition to the reduced VAT rate of 12%, and a zero rate.

The standard rate is applicable to all goods and services that do not qualify for the reduced rates. To obtain a comprehensive list of products and services subject to specific VAT rates in the Czech Republic, you can refer to our article – VAT Czech Republic 2023 for more information.

When is it mandatory to register for VAT in the Czech Republic

The Czech Republic, in line with its legal regulations, mandates VAT registration in situations similar to those in other EU member states. These include:

• the import and export of goods into and from the Czech Republic,
• distance selling of goods through mail orders to customers within the Czech Republic,
• procuring and reselling goods within the Czech Republic,
• storing goods within the Czech Republic.

It’s also crucial to note that every entrepreneur is obligated to register and settle VAT in the purchaser’s country or through the VAT OSS system when they surpass the intra-Community distance sales of goods limit, which is set at 10,000 Euros, encompassing the total value of all sales across the European Union. Since 1 July 2021, there has no longer been a VAT registration threshold for each, separate country. The distance selling threshold cover all the EU member states. However, if one would like to conduct a voluntary VAT registration, there are no obstacles to do so.

If you have questions concerning VAT or require VAT registration in the Czech Republic or any other EU or UK member state, don’t hesitate and schedule a free consultation, and our team of VAT Compliance specialists will handle the entire process for you.

How to register for VAT in the Czech Republic?

Foreign companies seeking Czech VAT registration are required to submit a registration declaration at the local Czech tax office. What’s important, in the Czech Republic there is a posibility of conducting an electronic VAT registration, among other options. Following the electronic submission, it is crucial to provide a confirmation of the registration via postal mail.

The registration process is usually straightforward and generally takes a maximum of 30 days, with the actual registration typically being completed in around two weeks. It’s crucial to emphasise that the prospective VAT payer must provide the necessary documents for the registration to be successful.

Documents required for VAT registration in the Czech Republic

For entrepreneurs seeking to obtain a Czech VAT number, the tax office requires a specific set of documents. These documents include, but are not limited to:

• the original registration in the national business register,
• confirmation of having a designated VAT bank account,
• proof of EU VAT registration,
• documentation validating the intended business activities in the Czech Republic,
• the completed registration application.

As mentioned earlier, the application can be submitted electronically. In such cases, it’s necessary to provide copies of the original documents. Additionally, a translation of the registration document in the entrepreneur’s home country, along with translations of company documents into Czech, must be included and physical copies sent by postal mail. Notably, sworn translations are required as well.

What is more, foreign entities from outside the EU, in order to register VAT in Czechia, have to appoint a tax agent, who will represent them in front of the Czech authorities in matters related to VAT. In order to do so, they have additionally have to provide the power of attorney to the Czech tax office.

Also note, that the tax representative is a term referring to an agent who represents foreign entities from outside the EU, and the fiscal agent is a person representing entrepreneurs from within the EU.

Need VAT registration in the Czech Republic?

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The Czech VAT number

The Czech VAT number consists of 8-10 digits, preceded with the country code “CZ”.

VAT Obligations in the Czech Republic

Upon a successful registration for Czech VAT, the taxpayer is granted a Czech VAT number, which is in the format ‘CZ’ followed by nine digits. It’s crucial to note that upon registration in the Czech Republic, the entrepreneur bears the responsibility of settling the due VAT and ensuring accurate filing of VAT returns within the Czech Republic. Failure to meet these obligations exposes them to potential penalties and fines.

VAT return obligation in the Czech republic

In the Czech Republic monthly VAT returns are the default option. However, companies that do not exceed 10 000 000 CZK turnover, can submit quarterly VAT returns. Moreover, time to submit them and pay VAT is till the 25 day of the month follow the tax period.

Moreover, in Czechia, there is no requirement for submitting annual VAT returns.

VAT registration Czech Republic - summary

VAT registration in the Czech Republic may appear intricate, but with a solid understanding of the tax rates, procedures, and prerequisites, businesses can effectively navigate the Czech tax system. While there are various VAT rates and distinct registration prerequisites, precise interpretation and adherence to these regulations can avoid imposed penalties and fines, especially in cases related to incorrect or late submission of tax declarations.

Whether you’re a new entrepreneur or an experienced one, it’s highly advisable to consider the support of specialists, and our VAT Compliance team offers that for both you and your company. Our team not only handles registrations ,VAT OSS or VAT EU settlements. All you need to do is schedule a free consultation and we will take care of the rest.

If you want to learn more about VAT in the EU member states, check out our articles about: Latvia, Malta, Lithuania, Finland, Portugal, Hungary, Germany or France.

See also our texts about VAT registrations in: Austria, Germany, France, Spain, the UK or Italy.