The Czech government responds quickly to the situation with the coronavirus "COVID-19" - FCHAIN в России

FCHAIN specialists working in our Czech branch are closely monitoring the situation in the country’s financial market and changes in legislation caused by the COVID-19 coronavirus pandemic. The documents and measures taken by the Czech Ministry of Finance should make it easier for local entrepreneurs to work in this difficult period. At a government meeting, the extension of tax breaks was approved within the framework of the so-called exemption package III, and the payment of tax on the purchase of real estate was postponed to the end of the year.

The offers that previously existed under the Release Packages I and II have been modified and supplemented. For example, the deadline for filing tax returns was postponed by almost 2 months for more business maneuver. Here is what the Minister of Finance of the Czech Republic Alena Schillerova says about this: «This will give entrepreneurs even more time to file returns and pay income tax, and save them important financial resources to overcome the difficult period»

The new package further extends the VAT exemption for free shipments of protective equipment made before July 31, 2020. Until the end of 2020, the obligation to file a tax return and pay tax on the acquisition of real estate is also postponed. Additionally, there is an automatic waiver of interest payments on all taxes for the period from the beginning of the emergency to December 31, 2020 in cases where tax authorities allow delays due to COVID-19.

Here are the main tax reliefs adopted by the Czech government and included in Release Package III:

  • De facto postponement of the return and payment of tax on the acquisition of real estate until December 31, 2020 (ie, waiver of sanctions related to later filing and payment).
  • Actual postponement of the deadline for filing tax returns until August 18, 2020. This date was chosen in connection with the extension of the deadline for the discussion of regular financial reporting of corporations (waiver of sanctions related to later filing and payment).
  • Waiver of VAT on the free supply of basic protective equipment, especially masks, respirators, disinfectants, etc., in respect of which there was a duty to declare tax in the period from May 18, 2020 to July 31, 2020.
  • Automatic waiver of interest on arrears arising from March 12, 2020 to December 31, 2020 in cases where the tax administrator has individually authorized such a delay or in the event of payment by installments for reasons related to the coronavirus.
  • Waiver of the administrative fee for filing applications with the tax or customs service before the end of 2020 (application for a deferral or payment of tax, application for waiver of interest for late payment, application for waiver of a fine for failure to submit an audit report, etc.)
  • The actual postponement of the deadline for filing an additional tax return for 2018 for those organizations for which there was a change in the methods of tax accounting in 2019, etc. The deadline for filing and paying tax was postponed to August 18, 2020 (waiver of sanctions related to later registration and payment).
  • Actual postponement of the exempt income notice deadline to August 18, 2020 (waiver of late filing sanctions).
  • Waiver of a fine for late filing of an application by an employer (personal income tax from dependent activities), if the application was submitted before May 31, 2020.

For more detailed information on the adopted package of measures and how best to use it, entrepreneurs operating on the Czech market can contact our specialists at: Česká republika, Vinohradská 184, 130 00 Praha 3 or by phone: +420 776 798 700.

Lala Mammadova,
Business Development Specialist



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