Becoming effective on 1 October, 2016, a new regulation concerning broadening the applicability of the reverse charge; put simply, it is a practice of the obligation to declare and pay the VAT for taxable supplies is transferred from the supplier to the customer as opposed to the “normal” mode, when the obligation is imposed on the supplier.
Currently, the reverse charge only applies, both permanently or temporarily, to, for instance, supplies of gold or selected types of waste, provision of construction and assembly services, supplies of mobile phones, tablets and laptops, or grains and technical crops; the list of products/services is to be widened to include the telecommunication services provided on the B2B basis. It should be noted that the place of supply of the provided services/delivered goods of such kind needs to be in the Czech Republic and the transaction has to be performed between two VAT-payers.
The amendment is a reaction to tax evasions in this area and also as a precaution against a possible transfer of frauds from other EU member states to the area of the Czech Republic.
