Czech Republic: VAT guidance regarding electricity and gas, and for tour operators

The tax administration clarified certain measures regarding VAT and certain utilities and new VAT rules for tour operators.

Electricity and gas, and for tour operators

The tax administration—known in English as the “General Financial Directorate” (GFD)—clarified certain measures regarding value added tax (VAT) and certain utilities (electricity and gas) and changed new VAT rules for tour operators effective 1 January 2022.

VAT waiver for electricity and gas

According to the GFD, a VAT waiver will apply to electricity intended for any purpose. As for gas, the waiver will apply both to supplies through the distribution system, and to tankers and cylinders. VAT on these supplies will be waived if the date when the obligation  to declare the tax arises is between 1 November and 31 December 2021.

The GFD also clarified how to settle VAT on advance supplies. If the payment settlement takes place following the date of taxable supply in November or December (in particular, when the measuring device is read in these months) and it results in an underpayment, the VAT waiver will apply even though the utility consumption relates to a prior period. If the settlement results in an overpayment, the tax rate applicable at the time of receiving the advance payment is to apply. Therefore, VAT will not apply to settlement of advances received in November or December 2021. 

Read a December 2021 report prepared by the KPMG member firm in the Czech Republic

VAT rules for tour operators

There are VAT changes for tour operators beginning 1 January 2022. Beginning in 2022, tour operators are to start declaring VAT on advances received and are not to calculate VAT based on aggregated monthly data.

Read a December 2021 report prepared by the KPMG member firm in the Czech Republic


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