In connection with the pandemic of the new coronavirus, several rules were approved in the scope of so called liberation packages in order to make it easier for entrepreneurs in the area of taxes and other compulsory payments and thus, toa improve their situation. As already more than three months have passed since the end of the state of emergency, many of these measures have expired.
Failure to reintroduce such obligations could lead to penalties of the tax from the side of the tax administration, which is - at a time when the second wave of the pandemic is on the brink – definitely something that every tax subject wants to avoid. Therefore, we bring you below an overview of the rules and obligations, which are returning to our legal system in full force.
At the beginning of September 2020, the self-employed persons are again obliged to pay minimum advances on social security and health insurance, in the same form as standardly before the issuance of the so called liberation package I, which brought us pardon of payment of minimum advances in the period of months March to August 2020.
Following the so called liberation package II, the obligation to pay income tax advance payable in June 2020 (i.e. the second advance for quarterly payers and the first advance for half-yearly payers) was abolished for individuals as well as legal entities whose tax period is a calendar year. However, this does not apply to the tax advance due in September or December 2020. We therefore recommend verifying the amount due according to the last filed return for the 2019 tax period and to not forget to pay the tax advance in time.
However, in this respect, it is also necessary to consider the possibility of asking the tax administrator to set tax advances in a different (lower) amount or to abolish the obligation to pay tax advances in full scope. Although such a request is not subject to an administrative fee (this exemption is valid until the end of 2020), it must be justified, as there is no legal right to issuance of such decision by the tax administrator and thus, it is upon the discretion of the tax administrator. In our experience, the tax administrator usually complies with such applications when the tax subject in question demonstrates that the total amount of tax advances paid according to the tax return would significantly exceed the resulting due tax liability, and it is therefore recommended to complete it with a provisional calculation of tax liability. We are very happy to offer our help and experience in this regard, so do not hesitate to contact us in respect with preparation for any of these applications.
The obligation to electronically record sales for entities within all phases of electronic evidence of sales has been suspended for the duration of the emergency and the following three months. As the state of emergency ended on 17 May 2020, starting as of 18 August 2020, the obligation to record sales electronically resumes again.
Liberation package I also brought a general pardon of penalties for late submission of VAT Ledger Statements in the amount of CZK 1,000, which arose between 1 March and 31 July 2020. As of 1 August 2020, delayed submission of VAT Ledger Statements is again subject to and "automatic" penalty in the amount of CZK 1,000.
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