On December 2, 2022, Act No. 366/2022, which amends the Income Tax Act and the Value Added Tax Act and introduces a Windfall Profits Act, was promulgated in the Collection of Laws. The Act comes into effect on January 1, 2023.
Among other things, the limit for compulsory registration of a VAT payer has been increased from CZK 1 million to CZK 2 million.
In connection with the increase in the registration limit, transitional provisions have been issued relating to possible deregistration if turnover does not reach CZK 2 million. The provision specifies the possibility of applying for cancellation of VAT registration if turnover in the last 12 months has been between CZK 1 million and CZK 2 million. An application for deregistration should have been submitted within 5 days after the effectiveness of the stipulation, i.e. by December 8, 2022.
The taxpayer will cease to be a taxpayer on the basis of the application:
- on January 1, 2023, if the decision on deregistration is delivered by December 31, 2022,
- on the day after the decision on deregistration is delivered if it is delivered on January 1, 2023 or later.
