Tax News

What does the latest VAT Act amendment introduce?

Barbora Palenikova

The National Council approved an amendment to the VAT Act, which implements mainly the changes in Directive no. 2006/112 / EC on the common system of value added tax with respect to e-commerce and distance sale of goods. Another key change is the introduction of the new regulation of the tax base correction in relation to bad debts. If certain conditions are met, VAT payers will be entitled to claim the unpaid VAT directly from the Tax Authority via VAT return.

Following the expected signature by the President, the following changes will be introduced effectively from 1.1.2021 and from 1.7.2021:

  1.  In the case of bad debts, the suppliers will be entitled to reduce their tax base and VAT (but only in selected situations);
  2.  Customers who have not paid the liability to the supplier will be obliged to remit the deducted VAT from the unpaid liability to the tax authority;
  3.  Changes in distance sales from 1.7.2021;
  4.  Introduction of new VAT special schemes;
  5.  Implementing rules for a taxable persons who facilitate distance sales of goods from third countries through the use of such an electronic interface and its automatic VAT registration.

For more information about new changes and information on how these changes may affect your business, please refer to the attached newsletter.