Czech VAT Act
Payer vs. Identified Person
The Czech VAT Act stipulates that a taxable person can become a payer or an identified person for tax purposes.
These two terms are often understood as identical, although this is not the case. They differ not only in registration obligations.
Payer
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a taxable person with a registered office in the Czech Republic becomes a payer if its turnover in the last 12 consecutive calendar months exceeds 1,000,000 CZK.
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a taxable person can become a payer even if it does not reach the above turnover - this is called voluntary VAT registration. This decision may be advantageous for this entity as it opens the way to reclaiming input VAT.
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a taxable person who does not have a registered office or establishment in the Czech Republic and who will carry out taxable supplies in the Czech Republic must become a payer (these entities are not subject to the turnover threshold of 1,000,000 CZK)
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Identified Person
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a taxable person with a registered office or establishment in the Czech Republic who is not a payer, when receiving a taxable supply with the place of supply in the Czech Republic from a person not established in the Czech Republic regarding the provision of services, delivery of goods with installation or assembly, delivery of goods through systems or networks (a Czech entrepreneur, non-VAT payer, received tax advisory services from a consulting company based in Austria)
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a taxable person with a registered office or establishment in the Czech Republic who is not a payer, from the day of providing the service according to § 9 paragraph 1 = general service (a Czech entrepreneur, non-VAT payer, provided tax advisory services to a company based in France)
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Inquiry: Payer vs. Identified Person
