Reverse charge by the construction business – new information notice issued the General Financial Directorate in cooperation with the Czech Statistical Office
The General Financial Directorate (hereinafter „GFD“) in cooperation with the Czech Statistical Office (hereinafter „CSO“) has issued at the end of August an information notice on classification of construction works under sections 41 to 43 of the CZ-CPA classification in relation to the applicable VAT regime – reverse charge. The information notice supplements existing materials issued by GFD and responds to developments in specific cases. Specifically the information notice amends for example commentary regarding installations, repairs and maintenance of equipment firmly fixed to the building, changes of using the reverse charge mechanism in case of repairs of door closers by doors firmly fixed to the building or by supply of refrigerators and freezers.
In conclusion the information notice states that where the taxpayers have so far acted in good faith, although their procedure did not comply with the instructions in the notice, tax authorities should not challenge the applied procedure, provided that the regulation was followed identically by the supplier and the customer.
The full text of the information notice is available here:
http://cds.mfcr.cz/cps/rde/xbcr/cds/info_GFR_a_CSU.pdf
Should you have any questions regarding the VAT point of view of construction works please do not hesitate to contact us.
