Final phase of e-sales since 1 May 2020

Jana Střelická

Effective from 1 May 2020, the obligation to record cash payments has been introduced for the remaining business activities. In general, payments are subject to electronic evidence of sales in case the “formal” attribute (i.e., the payment is in cash) and the “material” attribute (i.e., the payment relates to business activity) are fulfilled. Payments made by a credit card (either via a terminal in the respective business premises or payment via a payment portal) continue not to be subject to e-sales.

In addition to the existing exceptions to the e-sales records (payments of the state, local government or allowance organization, payments in the energy businesses under license, payments within employment or other similar relationship, payments from secondary business activities of non-profit organizations), the amendment introduces other exceptions such as payments related to social services, payments from telecommunication and related services (e.g. drawing credit, purchasing public transport tickets via SMS), payments from all types of gambling, payments from commercial air transport and directly related services (e.g. seat selection), payments received by blind or deafblind taxpayers, and payments for pre-Christmas sales of freshwater fish.

Along with the launch of the final phase of e-sales, the amendment to the Act on the Registration of Sales introduces for the smallest entrepreneurs the possibility to record their sales in a special regime. This regime, where cash payments can be registered not on-line but in a paper form, will be enabled for small traders who are not VAT payers, perform the business alone or with a maximum of two employees and have cash payments up to CZK 600 ths per year. In the case of health care service providers covered by public health care insurance system who receive reimbursement from a health insurance company for provision of health care services, the special scheme is enabled without further conditions.

E-sales records under the special regime will be done via officially marked paper receipts, which the entrepreneur will issue upon receipt of cash payments, and quarterly will report the total amount of sales and the number of issued and eventually cancelled receipts to the Tax office (within 20 days of the end of the quarter).

Similarly to the first and the second phase of e-sales records, also the final phase of e-sales adopts the method of e-sales records in case of a temporary internet connection failure (possibility to send a receipt within 48 hours) as well as simplified registration regime in case of the objective long-term impossibility to record sales within the regular on-line e-sales recording regime (so called off-line e-sales regime).

The amendment to the Act on the Registration of Sales also brought changes to the VAT Act. In this respect, from 1 May 2020 VAT will be reduced to 10% in case of catering services (including the sale of soft drinks and draft beer), selected craft and professional services (e.g. hairdressing and barbers' services, repairs of bicycles, footwear or clothing), home care services for children, elderly, sick and disabled persons, as well as water consumption and sewerage services. The significant VAT reduction accompanying the e-sales recording is primarily aimed at increasing net profit for businesses.

As with the first two phases of e-sales records, taxpayers obliged to record their sales are enabled to claim the one-off credit on personal income tax, up to CZK 5,000 in the first year of this obligation. It is thus possible to be compensated for any increase in costs that might have occurred in connection with the e-sales recording obligation.

Over the coming months, the Ministry of Finance and the Financial Administration are preparing a comprehensive communication campaign aimed at the business community, in which entrepreneurs will be informed in detail and provided with all information so that they are properly prepared for the e-sales records. The most up-to-date information will then be available at


Jana Střelická
Certified Tax Advisor