Is additional tax assessment due to VAT fraud reason enough not to waive penalties?

If the tax administrator concludes that a VAT payer has even indirectly been involved in VAT fraud (typically, by having accepted a delivery affected by fraud), the entitlement to VAT deduction will be withheld from the payer. The payment of…

SAC on existence of a permanent establishment

In its recent decision, the Supreme Administrative Court (SAC) dealt with selected facts giving rise to a foreign entity’s permanent establishment in the Czech Republic. In particular, the court pointed out that the tax administrator must produce…

SAC on proving indirect shareholding expenses

The Supreme Administrative Court (SAC) has recognised that it is not easy to prove the exact amount of overhead (indirect) expenses related to holding a share in a subsidiary. However, this practical pitfall does not change the fact that if a…

Watch out for the deadline for filing additional tax returns

In its recent decision, the Supreme Administrative Court (SAC) confirmed that the deadline for filing additional tax returns for a lower tax liability is based on a subjective lapse period – in other words, after that period expires, it is no longer…

VAT stated in a tax document for a fictitious transaction must be paid

In 8 Afs 21/2014-30 case, the Supreme Administrative Court (SAC) corrected the regional court’s interpretation of Section 108(4)(f) of the VAT Act. The provision stipulates that the person issuing a tax document indicating tax is also obliged to…

Prevention of double taxation: SAC deals with mutual agreement procedure between Czechia and Germany

The Supreme Administrative Court (SAC) has held that it is not for a court to determine whether any agreement concluded with another contracting state under a double tax treaty is invalid.

SAC defines difference between contract and foreign employees

The Supreme Administrative Court (SAC) has clarified the definition of a contract employee and a foreign employee as set out in the Sickness Insurance Act. The distinction between these two categories of employees working in the Czech Republic is…

SAC sanctions CZK 1 mil fine for ‘Svarc’ system

In its June 2020 judgement, the Supreme Administrative Court (SAC) dealt yet again with the ‘Svarc’ system. The court held that a CZK 1 mil fine for allowing illegal work had been rightly imposed by the Labour Inspection Office. The decision should…