In the last months, the businesses have been contacted by the tax offices with regard to alleged or factual errors in the submitted documents. As it has been repeatedly announced by the financial administration, however, all such contacts have been informal ones.
Whereas the sanctions for failing to meet the obligations concerning the control statement were rather rare last year, the situation has changed in 2017 with penalties ranging from CZK 10,000 to CZK 50,000 for late submission or omission to file the document or late or no reply to tax office calls for completion/correction of the data being imposed far more often.
This article is aimed at those who have had the above experience and are faced with such penalties , and examines the ways the financial authorities are allowed to communicate with them and available options of appealing against the sanctions.
Firstly, one needs to bear in the mind that, after having observed any discrepancies, the tax administrator is obliged to send a formal notice to the payer (or their representative) via their data box or the email address stated in the control statement. After the notice has been delivered, the payer is to submit a corrective control statement within five days, or, should the fault not have been made on the payer’s part, confirm the correctness of the submitted data. Should the corrective document be filed after the five-day period, the tax subject may be subject to a fine amounting to CZK 30,000, or, if there is no reaction to the appeal, CZK 50,000.
It should also be noted that if a tax payer fails to submit the control statement in due time and only do so after they have been summoned by the tax officials, they will be fined CZK 10,000 or CZK 1,000 if they manage to do so before being ordered to.
We would like to add that, as stated above, the tax officials often communicate their demands with the tax subjects via telephone or email; although utilisation of these means is in line with the law, we would like to point out that the identity of neither the tax payer’s representative nor the tax official may be established and information that the tax administrator is allowed to impart or entitled to demand this way. Such contacts, then, need only be deemed informal and established in order to avoid unnecessary, more complex proceedings.
If you happen to fail to reply to the formal notice of the tax office in time or at all and the corresponding fine will be imposed, you may appeal against it no later than three months after the related payment assessment has become effective; the appeal is charged with a administrative fee of CZK 1,000.
The CZK 1,000 fines are not possible to be appealed against; once in a calendar year, however, the fine is automatically pardoned and there is no need to apply for such action.
A method statement was issued by the general directorate regarding the fine pardons, which was extended on 6 March, 2017, by an addendum containing a list of the so-called justifiable reasons for penalty pardons – sudden acute health condition of the payer (or their representative), an individual or large-scale natural disaster being some of them. Also, the addendum stipulates that the penalties may only be pardoned if the payer in question has not breached the law and have not failed to honour their obligations to the financial administrators. Two fines may be pardoned for offences committed in 2016 and only one in 2017.
The full Czech version of the aforementioned method statement may be found here.