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News 20/2020

Autumn Tax Relief in Relation to the Coronavirus

The Ministry of Finance has announced several types of tax relief in relation to the strict measures adopted during the state of emergency. Please find brief presentation of these below.

Value added tax

Punitive interest incurred over the taxation period of September, October and November 2020 will be waived for selected payers of VAT (for those who make monthly payments), or punitive interest incurred over the third quarter or 2020 (for those who make quarterly payments). Due tax must however be paid no later than the end of 2020.

It will also be necessary to submit tax returns for VAT and also VAT control statements by the regular deadlines, as penalties for late submission of these will not be waived.

Income tax for corporate entities and natural persons

Advance payments on income tax due on 15 October 2020 and 15 December 2020 will be waived for the taxpayers specified below.

Road tax

All advance payments on road tax due in 2020 will be waived for the entities concerned.

Tax relief is not for everyone

The above-mentioned tax relief only relates to entities for which prohibited or restricted activities constitute the predominant source of their income. This therefore in particular concerns:

  • operators of restaurants and bars,
  • organisers of concerts, theatre and film performances,
  • organisers of congresses and trade fairs,
  • operators of indoor sports grounds, gyms and swimming pools,
  • operators of zoological and botanical gardens, museums, galleries, castles and chateaux.

How to apply for tax relief

The taxpayer proves entitlement to the above-mentioned tax relief by submission of notification to their tax office. The notification can be sent by e-mail.

Waiving of VAT in the event of provision of selected goods free of charge

The Ministry of Finance has also decided to waive VAT in the event of free provision of goods which are used in the fight against the spread of the coronavirus. This for example concerns test sets and diagnostic devices for COVID-19, protective equipment (face masks, googles, face shields and gloves), pulmonary ventilators or disinfectant products. A complete overview can be found in the respective decision which was published in Financial Bulletin No. 22/2020.

Entitlement to deduction of VAT from the respective taxable performance received is at the same time preserved for providers. Waiving of VAT is applicable to the period from 1 October 2020 until 31 December 2020.

Waiving of VAT in the event of provision of free performance to selected entities

The Ministry of Finance has also decided to waive VAT in the event of provision of free performance to selected entities. Waiving of this VAT does not relate to the subject, but to the recipient of the gift (free performance).

Waiving of this VAT therefore relates to free delivery of any goods or provision of any services for the requirements of healthcare service providers, the basic units of the integrated rescue system, the Czech Army and social service facilities. Entitlement to waiving of this VAT can also be exercised in the period from 1 October 2020 until 31 December 2020.

Please do not hesitate to contact us if anything is unclear or if you have any further questions.

The WTS Alfery Team