Tax and legal news

The GDF has published a new list of questions and answers on the reporting obligation for cross-border tax arrangements (DAC 6). The information clarifies that only a tax-transparent entity has a reporting obligation under DAC 6. According to the GFD, tax-transparent entities, such as a public company or a mutual fund, should be treated in such a way that their shareholder (partner), who is not involved in the arrangement as an investor, will not be considered a user of the arrangement.

At the end of June, the Czech National Bank increased its repo rate again – this time to 7% p.a. The higher repo rate will also have a major impact on the impact on the tax rate under the Tax Code. As of 1 July, default interest is calculated at the rate of 15% per annum. Late payment of tax is therefore more expensive again.

In June 2022, the Supreme Administrative Court (SAC) issued an important judgement regarding the application of deductions on research and development. The judgement resolves two questionable issues: (i) the concurrence of a subsidy and the claiming of a deduction, and (ii) the need to allow the tax administrator to take the technical documentation of the R&D project (or a copy thereof) outside the company’s premises for the purpose of verifying the novelty element.

The Supreme Administrative Court (the SAC) has issued a judgment concerning the švarc system and a disguised (de facto) employment service (i.e. job agency/headhunting service). According to the court, what is crucial for the assessment of the actual situation is how the employee himself understands his position - even if the services are invoiced on the basis of a work contract between companies.

Advocate General Juliane Kokott dealt with the question whether the general joint and several liability of the statutory body falls within the scope of the VAT Directive (on the grounds of the company's inability to pay its VAT debt). She also commented on whether national legislation can impose direct liability on a dishonest member of a managing board whose conduct leads to the company's inability to pay the tax properly.

On 21 June 2022, the government of the Czech Republic and the government of the state of Qatar signed the Agreement for the elimination of double taxation with respect to taxes on income and for the prevention of tax evasion and avoidance.