Case law
Monetary contribution to employee vacation: taxable income
In its recent decision, the Supreme Administrative Court upheld the state authorities’ interpretation as to what can be considered a non-monetary benefit to an employee from an employer. The ruling has implications for the exemption of the benefit…
Is it possible to maintain right to deduct even in chain fraud?
The Supreme Administrative Court in a recent judgment dealt with the right to deduct tax on a supply provided within a fraudulent chain of transactions. The tax administrator did not fully prove that the taxpayer knew, or could have known, that the…
Caution above all: pending litigation clauses in share transfer agreements
Agreements on the transfer of a share in a business corporation quite often contain clauses on pending court disputes and possible future debts of the company being purchased. In such cases, the arrangement may be that the debt shall be paid by the…
Penalty for filing VAT ledger statement for incorrect taxable period
In case 5 Afs 281/2021-34, the Supreme Administrative Court (SAC) dealt with the question of whether a CZK 50,000 penalty had been legitimately imposed on an entity who had incorrectly filed a VAT ledger statement for a previous period. The SAC…
VAT treatment of sub-participation agreements
The Court of Justice of the European Union (CJEU) has dealt with the question whether sub-participation agreements, whereby a creditor under a credit agreement (a lender) transfers the credit risk to a third party, are covered by the exemption from…
CJEU on right to deduct VAT upon entering liquidation
The Court of Justice of the European Union ruled on whether there is an obligation to correct the previously claimed VAT deduction on capital goods if a company enters into liquidation and applies for VAT deregistration.
Definition of concern group for actions to set aside under insolvency act
The Business Corporations Act defines a group (a ‘concern’) as follows: one or more persons subject to single management by another person or persons form a concern group with that dominant person. However, the concept of a concern group is also…
Right to deduct where supplier has not paid output VAT
In case C-227/21 HA.EN. the Court of Justice of the European Union (CJEU) dealt with whether a supply recipient has the right to deduct VAT if they knew or should have known that the supplier was not going to pay output VAT because of financial…
When do structures come into existence or cease to exist in the legal sense? What…
In its recent judgment, the Supreme Administrative Court dealt with the question of when a structure comes into existence or ceases to exist as a thing in the legal sense (7 Afs 132/2022-22), which impacts the deductibility of tax expenses.
CJEU again on right to deduct VAT in context of holding companies
The Court of Justice of the European Union has ruled on whether a holding company is entitled to deduct VAT on inputs relating to services provided as a shareholder’s contribution.
May tax administrator request information about movement of vehicles from traffic…
The Supreme Administrative Court (SAC) has confirmed that tax administrators may for tax purposes request from the Police of the Czech Republic information on the movement of particular motor vehicles processed within the automatic vehicle detection…
When claiming R&D allowance, attention must be paid to cost accounting
According to the Regional Court in Ostrava, when proving compliance with the conditions for claiming a research and development allowance, it is necessary that expenses incurred in the implementation of research and development projects are…