Czech quick response mechanism for VAT fraud and new supplementary reporting

Mon 17th Nov 2014

The parliament has ratified a range of Czech VAT measures. These include:

Quick response mechanism VAT

The introduction of the EU’s Quick Response Mechanism for the prevention of VAT fraud in sectors susceptible to missing trader fraud. This enables member states to apply the domestic reverse charge on sales of certain goods subject to only 30 days notice to the European Commission. The Czech tax authorities have identified the following goods: mobile phones; carbon credit and greenhouse gas emission allowances; computer chips; and certain precious metals. The measure will be permitted for between 9 months and 1 year. During this time, there will be no VAT charged by the seller; instead the acquirer must record the input and output VAT in one transaction.

Czech supplementary VAT fraud reporting

From January 2006, VAT registered businesses will be required to submit a new monthly report in addition to their VAT returns. This control form will report domestic VAT’able supplies.  The aim of the new filing is to assist the authorities helping identify potential VAT fraud.

The Czech VAT registration threshold will not be reduced, as planned.