Czech Republic: Guidance on procedures following expiration of tax assessment period

The General Financial Directorate (GFD) issued new methodological guidance—in response to a recent decision of the Extended Chamber of the Supreme Administrative Court—that standardizes the procedures applied by tax authorities when tax proceedings are terminated due to the expiration of the statutory tax assessment period.

The Extended Chamber’s decision produced two key conclusions:

• The first conclusion is that, once the time limit has expired, the tax administrator cannot assess the tax. This has practical implications particularly when the tax administrator has initiated an inspection of a taxpayer’s tax return claiming a value added tax (VAT) deduction or a tax reduction and has failed to issue a decision within the time limit for tax assessment.
• The second conclusion relates to situations in which the objective time limit for tax assessment may be extended to 11 years instead of the standard maximum of 10 years. When a taxpayer submits an additional tax return claiming a lower tax liability within the final 12 months of the 10-year objective period, both the court’s decision and the new guidance allow the tax authority to carry out an inspection. However, the outcome of such an inspection may not result in a higher tax liability; it may only lead to the partial acceptance of the claim stated in the additional return or to its rejection.

Read an April 2026 report prepared by the KPMG member firm in the Czech Republic