News in brief, August 2021

Last month’s tax and legal news in a few sentences.

Ministry of Industry and Trade presents Czech Hydrogen Strategy

The EU member states have committed to achieving climate neutrality across the EU by 2050. Following this obligation, the Ministry of Industry and Trade presented the Czech Hydrogen Strategy at an international hydrogen conference held on 16 July…

Kurzarbeit finally given green light after one year

In a draft amendment to the Act on Employment submitted at the end of August last year, the Ministry of Labour and Social Affairs introduced its long-awaited concept for the provision of support during partial unemployment, the kurzarbeit (short…

Transfer pricing remains under tax administrators’ scrutiny

The financial administration has published information about its tax inspections focusing on transfer prices between related parties. In 2020, tax administrators carried out 249 inspections, assessing additional corporate income tax of CZK 1.4…

Minimising penalties: how to claim a default interest waiver?

The January amendment to the Tax Procedure Code has brought relatively significant changes to default interest, introducing a single default interest rate for both tax administrators and taxpayers of 8% + repo rate. However, taxpayers have tools at…

Alternative solutions to competition issues in Anti-Trust Office’s decision- making…

In the recent case, the Office for the Protection of Competition refrained from initiating sanction proceedings despite the alleged existence of an illegal price-fixing agreement. The office thus indicated its willingness to resolve some matters by…

August brings significant changes to regulation of foreigners’ residence in the CR

An amendment to the Act on Residence of Foreign Nationals has undergone a dramatic legislative process. After being vetoed by the senate and subsequently overruled by the deputies, the amendment was signed by the president and promulgated in the…

New areas of unqualified trade

With the transposition of new EU rules aiming to prevent the use of financial systems for money laundering or the financing of terrorism into Czech law, new activities were added to ‘unqualified trade’ under the Trade Licensing Act on 1 January 2021…

Tax and IT services for investment funds – exempted from VAT?

The Court of Justice of the European Union (CJEU) yet again dealt with the question of which services provided to collective investment undertakings can be exempted from VAT. In joined cases C58/20 and C59/20, the court outlined the conditions under…

Amendment to Act on Banks

The implementation of CRR II and CRD V has been delayed. The amendment introduces changes to the responsibility of banks, credit unions and securities brokers and new authorisations of the Czech National Bank. Financial institutions must prepare…

New tax credit amounts per second and third child in 2021 taxable period

An amendment to the Income Tax Act, which is part of the amendment to the Act on State Social Aid and introduces a higher annual tax credit per second, third and any subsequent child while simultaneously abolishing the maximum monthly tax bonus…

Denying right to deduct VAT before entering bankruptcy compatible with EU directive?

The Court of Justice of the European Union (CJEU) has dealt with the refusal of the right to deduct VAT on taxable transactions carried out by a Romanian company before entering insolvency proceedings.