Value-added tax in Central and Eastern Europe | eBook

VAT rates

Basic and reduced VAT rates

The basic VAT rate in the Czech Republic equals 21%. A reduced VAT rate of 15% is applicable to specific goods and services, such as some food and non-alcoholic beverage items, plants, special healthcare products, pharmaceutical products, public transportation or hotel accommodation. A 10% VAT rate applies to another selection goods, such as infant nutrition, drugs, vaccines and printed books.

Export within and outside the European Union

The supply of goods to another EU member state is exempt from VAT, provided that:

• The goods are physically delivered to another EU member state
• The customer is a VAT payer who is registered for VAT in another EU member state.
• The goods are transported by a supplier, customer or third person on their behalf

The export of goods outside the EU is exempt from VAT, provided that:

• The goods are physically transported to third country by supplier or customer
• The supplier has confirmation of custom authorities on export from the EU

Taxable amount

The taxable amount equals the total amount that was received or shall be received for a taxable supply, including any excise duties, however, it does not include the value added tax.

VAT registration of domestic taxable persons

Voluntary and obligatory registration

Voluntary VAT registration is possible, but only for a taxable person. However, if the turnover threshold reaches CZK 1,000,000 within any 12-month period, registration for VAT becomes obligatory.

The due day to file the obligatory VAT registration falls on the 15th day of the calendar month following the calendar month in which the turnover threshold has been reached.

Group registration for taxable entities

In the Czech Republic, taxable entities who have their seat, place of business or fixes establishment within Czech territory and are financially, economically and organizationally connected, may participate in group VAT registration and therefore be considered as a single taxable person for VAT purposes.

Other specifications of the VAT registration

In case a taxable person does not fulfil the obligation to register for VAT, the tax authority is entitled to do so ex officio.

Besides the obligatory registration, Czech taxable entities must register for VAT for intra-community purposes in case of service provision to another EU member state or in case of acquisition of goods or services from another EU member state.

VAT registration of foreign taxable persons

Definition of foreign taxable persons

Foreign taxable persons are entities without seat or fixed establishment located in the Czech Republic, who realize the delivery of goods or service provisions subject to Czech VAT obligations.

Obligatory registration for foreign taxable persons

Foreign taxable persons are obliged to register for VAT in the Czech Republic in case they deliver goods or provide services subject to Czech VAT obligations (except when the recipient is obliged to pay the tax) as well as in case of acquisition of goods from other EU member states.

The threshold for the obligatory registration of foreign taxable persons is CZK 1,140,000 within a calendar year. The deadline to register for distance sale falls on the 15^th day after the taxable person exceeds the threshold and becomes a VAT payer.

Communication with authorities

Local statutory representation for VAT

In the Czech Republic, local representation by a tax advisor is not obligatory. However, in specific cases, foreign entities are very likely to use the services of a tax advisor.

Statutory language

In communication with the Czech tax authorities, only Czech language may be used.

Communication with authorities

A taxable person can communicate with the tax authorities in written form, verbally to the protocol or electronically via the data box. The VAT return and EC sales must be filed via data box only in case the data box is accessible for the taxable person or their representant.

VAT compliance and return filing

Tax period and deadline for VAT return filing

In the Czech Republic, the calendar month is considered as a tax period. A later change to calendar quarter is possible under specific conditions. The VAT return shall be filed until the 25th day following the respective tax period.

EC sales list and other documents

The EC sales list shall be filed until the 25th day following the respective tax period which is in general a calendar month; eventually a calendar quarter.

Besides the VAT return, a control statement listing information from issued and received invoices must be filed as well.

VAT refund to EU member states

Minimum amount and applicable period

The minimum amount to be refunded is EUR 50 for the respective calendar year. However, the VAT refund may be requested also for shorter periods than the whole calendar year, but such period may not be shorter than 3 calendar months while the value of VAT must exceed EUR 400.

Deadline and place of filing for VAT refund

The deadline for filing of the VAT refund request is September 30 of the subsequent calendar year. The request shall be filed with the local tax authority in the other EU member state. The deadline for the VAT return is 10 working days after a decision on the VAT refund is issued. This decision is issued between 4 to 8 months after filing the VAT refund request.

Refund for foreign taxable persons

VAT refund for a foreign taxable person is possible, upon the fulfilment of specific conditions.

VAT refund to third countries

VAT refund conditions

Upon the fulfilment of specific conditions, including reciprocity (currently applicable to Switzerland, Norway and Macedonia), VAT refund to third countries is possible.

Minimum amount and applicable period for VAT refund

The minimum amount to be refunded is CZK 1,000 for the respective calendar year. However, the VAT refund may be requested also for shorter periods than a whole calendar year, but such period shall not be shorter than 3 calendar months and the value of VAT must exceed CZK 7,000.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request falls on June 30 of the subsequent calendar year. The request shall be filed with the Tax office in Prague, Czech Republic. The deadline for the VAT return is 6 months after filing the VAT refund request.

Penalties for VAT non-compliance

Depending on the specific situation, following penalties can be imposed in case of VAT non-compliance:

• Fine up to CZK 300 000
• Late payment interest that is calculated as the National Bank’s repo-rate (currently 2%) increased by 14 %

Penalty in the amount of 20 % of the assessed VAT amount

VAT rates

Basic and reduced VAT rates

The basic VAT rate in Hungary is 27% in accordance with the EU VAT directive. A reduced rate of 5% applies to some type of milk, poultry meat, fresh eggs, medicine, books, magazines, specific large live animals, district heating services, instrumental live music performed by artists at private events, restaurants, commercial accommodation services and internet. The 18% rate can be applied to dairy products, products made from milk, corn, starch and service providers of open-air events.

Export within and outside the European Union

The supply of goods to other EU member states is free from VAT, if delivered to a VAT payer registered in the member state and the products are transported to any other member state. The export of goods is free from VAT, but subject to a confirmation by the customs authorities.

Taxable amount

The taxable amount equals everything that is deemed to be received or shall be received for the delivery of goods or services. In case of the import of goods from third countries, the taxable amount is based on the value of customs.

VAT registration of domestic taxable persons

Voluntary and obligatory registration

In Hungary, all domestic taxable persons are VAT payers by law. Before starting any business activity, taxable persons must be registered at least for a VAT number. Retrospective VAT registration is also possible, but it means a delay penalty risk. There is no threshold that makes the obligation applicable or non-applicable.

Group registration for taxable entities

Group registration for VAT is possible in Hungary. Several taxable persons who have their seat, place of business or fixed establishment within the territory of Hungary and are considered as affiliated companies, may participate in group VAT registration and therefore be considered as a single taxable person for VAT purposes.

Other specifications of the VAT registration

Taxable persons must register to obtain an EU VAT number as well if they will be performing EU transactions, such as service delivery to other EU member states or acquiring goods or services from other EU member states. This registration must be done in advance because retrospective registration is not possible.

Besides that, even natural persons may become VAT payers by law without previous registration, e.g. in case of supplying new means of transport, buildings or unbuilt lands in a series of transactions.

VAT registration of foreign taxable persons

Definition of foreign taxable persons

Foreign taxable person are entities who have no seat, place of business or fixed establishment in Hungary, but who are pursuing business activities with a place of performance is in Hungary.

Obligatory registration for foreign taxable persons

Foreign taxable persons in Hungary are obliged to register for VAT before doing any activities subject to VAT, and whose place of performance is in Hungary – except, for example, distance sale. The threshold for obligatory VAT registration due distance sale is EUR 35 000 within a calendar year. VAT registration for distance sale must be done before the sale by which the threshold of EUR 35 000 will be reached within a calendar year.

Communication with authorities

Local statutory representation for VAT

In Hungary, local representation by a tax advisor is not obligatory. However, foreign persons may need local representation in specific situations.

Statutory language

Only Hungarian language may be used for communication with the tax authorities.

Communication with authorities

A taxable person can communicate with the tax authorities in electronic format, via the company gate or client gate portal of the tax authorities. However, a qualified electronic signature is required for the electronic communication.

VAT compliance and return filing

Tax period and deadline for VAT return filing

In Hungary, the calendar month is considered as a tax period at the beginning of the business activity. Later on, and based on financial indicators, it can be changed to a calendar quarter or calendar year.

VAT returns are required to be submitted either monthly, quarterly or yearly. The deadline is the 20^th day of the month following the given period. The yearly VAT return must be submitted by February 25 following the given tax year.

EC sales list and other documents

The EC sales list shall be filed till the 20^th day following the respective period, which is in general the calendar month. The EC sales list may be filed for a period of a calendar quarter in case the taxable person submits the VAT returns at a quarterly basis and the value of delivered goods to other EU member states does not exceed the threshold of EUR 50 000 within the given calendar quarter.

Besides the VAT return, the control statement listing information from received invoices must be filed too, in case the amount of VAT charges reaches or exceeds HUF 100 000 or in case the domestic reverse charge mechanism is to be applied with regards to a certain product supply.

VAT refund to EU member states

Minimum amount and applicable period

The minimum amount of VAT requested must be at least EUR 50 for the respective calendar year.

The VAT refund may be requested also for a shorter period. However, it shall not be shorter than 3 calendar months and the value of VAT must be at least € 400.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request is September 30 of the subsequent calendar year. The request for VAT refund shall be filed with the local tax authority of the member state. The deadline for VAT return is between 4 to 8 months depending on the communication between the tax authority and the applicant.

Refund for foreign taxable persons

VAT refund for a foreign taxable person is possible, upon the fulfilment of specific conditions.

VAT refund to third countries

VAT refund conditions

VAT refund to third countries are possible for Liechtenstein, Switzerland, Norway, Serbia and Turkey, although with restrictions.

Minimum amount and applicable period for VAT refund

The value of requested VAT must be at least EUR 50 for the respective calendar year.

The VAT refund may be requested also for half calendar year. However, this case the value of the requested VAT has to exceed EUR 400.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request falls on September 30 of the subsequent calendar year. The request for VAT refund shall be filed at the Tax office in Hungary. The deadline for VAT return is between 4 to 8 months after filing the refund request.

Penalties for VAT non-compliance

Depending on the nature of the breach of the law, penalty for non-compliance can be imposed in form of fine, based on situation and severity, up to HUF 1 000 000 per infringement. Delay interest for late payment is the central bank base rate plus 5 % points.

VAT rates

Basic and reduced VAT rates

The basic VAT rate in Poland is 23%. Reduced VAT rates of 5% and 8% apply to a wide range of goods which may change over time (special decree is issued in this respect). In general, lower rates apply to specific hygiene products, books, newspapers and food products. Each product or service should be considered individually.

Export within and outside the European Union

Intra-community supplies of goods and exports outside the EU are under several conditions subject to exemption with deductibility right (0% tax rate is applied).

Taxable amount

The taxable amount is understood as any kind of remuneration received or due in exchange for the supply of goods or provision of service. The tax base also includes other additional payments of similar nature, which have a direct impact on the price of goods or services supplied by the taxpayer.

VAT registration of domestic taxable persons

Voluntary and obligatory registration

In Poland, voluntary VAT registration is possible for entrepreneurs whose income in the last tax year did not exceed PLN 200 000. This VAT exemption is related to sales limit with some limitations for specific sectors. The possibility of voluntary registration is also available in selected cases whereas a rule VAT exemption is applicable.

The threshold for compulsory VAT registration is PLN 200 000 turnover. Entities exceeding this amount are obliged to register. Performing taxable transaction or exceeding the threshold triggers the registration duty which should be performed by filing specific form.

Group registration for taxable entities

In Poland, group registration is not possible for VAT.

Other specifications of the VAT registration

In Poland there are formal and material conditions stated in the VAT regulation, therefore even entities who do not have the status of VAT taxpayers formally can still be considered as entities performing activities subject to VAT.

If an entity intends to do business with foreign contractors from EU countries, they must register as a taxpayer of EU VAT. Although they are not obliged to register as an active VAT taxpayer, however, if they make an intra-community acquisition of goods (WNT) and the total value of these transactions exceeds PLN 50 000 during the tax year, they are obliged to account for VAT on these transactions (despite the fact that there is no obligation to settle VAT in respect of other business activities).

The obligation to register for EU VAT (irrespective of the VAT exemption) also applies to:

• The purchase of services from contracting parties in the EU for which the place of performance is in the purchaser’s country
• Intra-community supply of services for which the place of taxation of the transaction is in the country of the person acquiring the goods
• If the entity is exempt from VAT and registers as a taxable person of EU VAT, they do not lose the right to be exempt from VAT

There is newly introduced whitelist institution related to VAT settlement. It is generally available register of VAT taxpayers where registration and bank account must be verified before give invoice will be settled.

VAT registration of foreign taxable persons

Definition of foreign taxable persons

In Poland, foreign entities are understood as legal persons, organisational entities without legal personality and natural persons with registered office or a fixed place of business in the territory of Poland, carrying out activities which are subject to Polish VAT regulations.

Obligatory registration for foreign taxable persons

Foreign entities are obliged to file a registration application with the Head of the Tax Office before the date of the performance of their first taxable activity. For distance sellers from the EU, who are selling the goods to customers in Poland, the VAT registration threshold (for distance selling) is PLN 160 000.

Communication with authorities

Local statutory representation for VAT

Representation of the taxable person in front of the Polish tax authority by a tax advisor is not obligatory.

Statutory language

In communication with the tax authorities, only Polish language may be used.

Communication with authorities

A taxpayer may communicate with the tax authorities both electronically and by post. However, the VAT returns must be submitted electronically.

Starting from July 1, 2020, companies in Poland will be obliged to submit the JPK_VDEK files containing both the VAT returns and the Standard Audit File (SAF), while the VAT records must be kept in an electronic system.

VAT compliance and return filing

Tax period and deadline for VAT return filing

The tax period equals the respective month, or for small taxpayers the calendar quarter.

The VAT return should be submitted by the 25th day following the settlement period. In case of taxpayers who settle the VAT quarterly, the deadline of submission falls on the 25th day of each month following the quarter.

EC sales list and other documents

EC sales list (or the so-called VAT_UE) should be submitted by the 25th day of the month for the previous month – the same time as in case of the VAT returnAll entrepreneurs are obliged to submit the SAF for VAT purposes, the so called JPK_VAT. Upon the demand of the authorities, the following documents should be submitted:

• Accounting books (JPK_KR)
• Bank statement (JPK_WB)
• Magazine (JPK_MAG)
• VAT invoice (JPK_FA)
• Tax revenue and expense ledger (JPK_PKPIR)
• Income records (JPK_EWP)

VAT refund to EU member states

Minimum amount and applicable period

In order to file for refund, the value of VAT may not be less than the PLN equivalent of the following amounts:

• EUR 400– in case the period (for which a refund request is filed) is shorter than the tax year, but exceeds 3 months;
• EUR 50– in case the period (for which a refund request is filed) concerns the whole tax year or a period shorter than the last 3 months of the year.

The conversion of the amounts mentioned above expressed in EUR shall be carried out according to the average exchange rate of the euro announced by the National Bank of Poland, in force on the last business day preceding the date of issue of the invoice or customs document.

Given entity may apply for a tax refund for a period exceeding 3 months and not longer than 1 tax year, or for a period shorter than the last 3 months of the year. The requested amounts of tax in the given period is established based on the invoices documenting the acquisition of goods and services or based on the customs clearance documents in case of import.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request falls on September 30^th of year following the year covered by the request. It should be submitted in Polish to the tax administration in electronic form.

The deadline for tax refund falls on the 4^th month after the request for refund is filed, including all supportive documents. The tax office will refund the indicated amount of tax no later than within 10 working days from the day of taking a decision on the amount to be refunded.

Refund for foreign taxable persons

VAT refund for foreign taxable persons from EU member states is possible, upon the fulfilment of specific conditions.

VAT refund to third countries

VAT refund conditions

VAT refund to third countries is possible, upon the fulfilment of specific conditions.

Minimum amount and applicable period for VAT refund

In case of VAT refunds to third countries, the same rules apply as in case of VAT refund to EU member states (see VAT refund to EU member states – Minimum amount and applicable period for more information).

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request in case of refunds to third countries is the same as in the case of EU member states, i.e. it falls on September 30 of next year and must be submitted electronically in Polish language. The deadline for VAT return also falls on the 4th month after the request for refund is filed, while the tax office conducts the refund also within the 10 working days after taking a decision on the amount to be refunded.

Penalties for VAT non-compliance

Depending on the situation, the sanctions in VAT are either 100%, 30%, 20% or 15%. Apart from sanctions under the VAT Act, there are also sanctions in the Fiscal Penal Code that should be taken into consideration.

VAT rates

Basic and reduced VAT rates

The basic VAT rate in Romania is 19%, but a reduced rate of 9% applies to the food and beverage industry, medical treatments and prosthesis, accommodation and others. An extra-reduced 5% rate applies to supplies of social housing under certain conditions and to schoolbooks, newspapers, magazines, admission fees to castles, museums, sport events and cinemas, among others.

Export within and outside the European Union

The supply of goods to other EU member states are exempt from VAT. In order to apply this exemption, the buyer should be registered for VAT purposes in the other EU member state while the transport of goods to the other EU member state should be justified with a set of required documents.

Starting January 1, 2020, such back-up documentation was aligned at the level of the European Union, therefore such documents required by the tax authorities should be the same in each and every EU Member State.

Deliveries of goods outside the EU are being considered as exports for which the same VAT exemption would apply. In order to apply such exemption, back-up documentation would be required function of the statute of the party involved in the transaction (i.e. supplier or beneficiary).

Taxable amount

The taxable amount to which would apply the relevant quota of VAT equals the total consideration obtained or to be obtained for a supply, including any excise duties or other taxes and fees.

VAT registration of domestic taxable persons

Voluntary and obligatory registration

In Romania, voluntary registration for VAT is possible and may be performed by any taxable person with the headquarter of the economic activity in Romania and currently conducts or intends to carry out economic activity falling within the scope of VAT

Regarding the mandatory VAT registration, a threshold of EUR 88.500 annual turnover is provided.

The application for VAT registration is made within 10 days from the end of the month in which this threshold is reached or exceeded.

Group registration for taxable entities

Group registration for VAT is available for entities in Romania under certain conditions.

Other specifications of the VAT registration

According to the legislation in force, Romanian tax authorities have the right to register ex officio for VAT purposes those taxable persons that register an annual turnover of at least EUR 88.500 and have not requested the registration as per the law.

Besides the mandatory registration, Romanian taxable persons would have to register for VAT purposes before performing intra-Community transactions, under certain conditions, for the purposes of service delivery to other EU member states, or for the purposes of acquiring goods or services from other EU member states. The registration must be done in advance.

VAT registration of foreign taxable persons

Definition of foreign taxable persons

Foreign persons are taxable person whose seat, place of business or fixed establishment is located outside Romania.

Obligatory registration for foreign taxable persons

Before starting an activity that is subject to VAT, any foreign taxable person should register for VAT purposes in Romania.

In case of distance sale activity, the threshold for VAT registration is of EUR 35.000.

Communication with authorities

Local statutory representation for VAT

In Romania, local representation by a tax advisor is not mandatory.

Statutory language

Only Romanian language may be used for communication with the tax authorities.

Communication with authorities

A taxable person may communicate with the tax authorities in electronic format, through the virtual space of the taxpayer, or on the online platform of the tax authority. However, the electronic communication requires a certified electronic signature.

VAT compliance and return filing

Tax period and deadline for VAT return filing

In Romania, the standard fiscal period is the calendar month.

For taxable persons whose previous year-end turnover is lower than EUR 100.000 and did not perform intra-community transactions, the fiscal period is the calendar quarter.

The VAT return should be filed no later than 25^th day following the respective tax period.

EC sales list and other documents

The EC list shall be filed until the 25^th day following the respective tax period. In addition, the informative return for domestic transactions should be provided as well.

VAT refund to EU member states

Minimum amount and applicable period

If the VAT refund request concerns a period of less than one calendar year, but greater than 3 months, the amount of VAT for which the refund is requested may not be less than the RON equivalent of EUR 400.

However, if the request refers to a period of one calendar year or the remaining period of the calendar year, the amount of VAT may not be less than the RON equivalent of EUR 50.

The period for which the VAT is refunded may be maximum one calendar year and minimum 3 calendar months. Refund requests may, however, concern a period of less than 3 months if this is the period remaining until the end of the calendar year.

Deadline and place of filing for VAT refund

The request for refund should be transmitted electronically at the latest by September 30 of the calendar year following the refund period. The request should be filed at the local tax authority of the foreign taxable person.

Refund for foreign taxable persons

The VAT refund is possible for foreign taxable person if certain conditions are met.

VAT refund to third countries

VAT refund conditions

The VAT refund is possible concerning third countries if certain conditions are met.

Minimum amount and applicable period for VAT refund

VAT refunds to third countries are subject to the same rules as refunds to EU member states.

Nevertheless, another mandatory condition is that between Romania and that third party to be concluded a specific mutual agreement.

Deadline and place of filing for VAT refund

The request for VAT refund should be submitted by September 30 of the subsequent calendar year following the refund period. The request should be submitted to the registry office of the tax authorities or by post. The deadline for issuing the decision is 6 months starting from the date the tax authority has received the entire documentation.

Penalties for VAT non-compliance

The penalties for non-compliance may be the following:

• Fines between approx. EUR 200 and EUR 1000
• Interest for late payment 7,3% p.a.
• Penalties for late payment 3,7% p.a.
• Penalties for non-declaration 29,2% p.a.

VAT rates

Basic and reduced VAT rates

The basic VAT rate in Russia is 20%, but a reduced 10% rate is applicable to pharmaceuticals, some medical products, books, dairy or meet products and other goods. The full list of goods is indicated in the Tax Code.

Export within and outside the European Union

The supply of goods to other EU member states is free from VAT, while the export of goods outside EU is also exempt from tax.

Taxable amount

The taxable amount is indicated in related documents, such as the acts of acceptance, delivery note or VAT invoice. Generally, the amount equals the cost of sold goods or provided services.

VAT registration of domestic taxable persons

Voluntary and obligatory registration

Registering for VAT in Russia is voluntary for most companies, however, there are exceptions which make it obligatory. These include companies who import and export goods, supply goods and services with a value of more than RUB 2 million or provide electronic services. The obligation for the later came into force on January 1, 2019 for Russian taxable persons.

Group registration for taxable entities

Group registration of companies for VAT is possible in Russia.

Other specifications of the VAT registration

Taxable persons cannot become VAT payers without previous registration. The only exceptions are foreign companies providing electronic services, who are obliged to pay VAT regardless whether they are registered or not.

VAT registration of foreign taxable persons

Definition of foreign taxable persons

According to Russian law, foreign taxable persons are entities without seat, place of business or fixed establishment located in Russia.

Obligatory registration for foreign taxable persons

There is a statutory obligation for foreign companies to register for taxes in case they are making taxable supplies in Russia. This obligation is not based on threshold and no deadlines are applicable for the registration due distance sales.

Communication with authorities

Local statutory representation for VAT

In Russia, local representation by a tax advisor is not obligatory. However, foreign persons may need local representation in specific situations, e.g. in order to clarify their taxes, calculations and others.

Statutory language

Only Russian language may be used for communication with the tax authorities.

Communication with authorities

A taxable person can communicate with the tax authorities in electronic format, via the data box of tax authorities. However, qualified electronic signature is required for the electronic communication.

VAT compliance and return filing

Tax period and deadline for VAT return filing

In Russia, the calendar quarter is considered as a tax period. The request for VAT return shall be filed until the 25^th day following the respective tax period.

EC sales list and other documents

EC sales list is not applicable in Russia, but besides the VAT return, the control statement listing information from issued and received invoices must be filed as well.

VAT refund to EU member states

Minimum amount and applicable period

There is no threshold for the value of VAT to be refunded. The refund can be requested only for the tax period, which is the calendar quarter.

Deadline and place of filing for VAT refund

The request for VAT refund shall be filed at the local tax authority within 3 years from the date on the VAT invoice. The return of VAT is conducted within the month after receiving a decision from the tax authority about the refund.

Refund for foreign taxable persons

VAT refund for a foreign taxable person is possible, upon the fulfilment of specific conditions.

VAT refund to third countries

Conditions, minimum amount and applicable period for VAT refund

VAT refund to third countries is not applicable. There is no threshold for the value of VAT to be refunded. The refund can be requested only for the tax period, which is the calendar quarter.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request in Russia falls on the end of the 1^st month after receiving a decision from the tax authority about the refund. The refund is then indicated in the tax return which should be submitted until the 25^th day following the respective tax period.

The request for VAT refund shall be filed at the tax office in Russia where the company is registered. The deadline for the return of the VAT equals the 1^st month after receiving the decision of the tax authority about the refund.

Penalties for VAT non-compliance

The penalty for late payment is 10,5 % p.a.

VAT rates

Basic and reduced VAT rates

The basic VAT rate in Slovakia is 20%, but a reduced of 10% is also applicable. Although the reduced rate applies to a longer list that may change, in general, it may be applicable to pharmaceuticals, some medical products, books, dairy or meet products and accommodation. In any case, the actual product or service should be reviewed individually.

Export within and outside the European Union

The supply of goods to other EU member states are free from VAT, if delivered to a VAT payer registered in another EU member state and transported to such member state. The export of goods outside of EU is free from VAT but is subject to the confirmation of custom authorities on export from EU.

Taxable amount

The taxable amount equals everything that is deemed to be received or shall be received for the delivery of goods or services. In case of the import of goods from third countries, the taxable amount is based on the value of customs.

VAT registration of domestic taxable persons

Voluntary and obligatory registration

Voluntary VAT registration in Slovakia is possible, but only for a taxable person, i.e. person (natural or legal person) pursuing economic activity. The turnover threshold for obligatory VAT registration is EUR 49 790 within any 12-month period.

The deadline for filing the obligatory VAT registration falls on the 20^th day of the calendar month following the calendar month in which the turnover threshold has been reached. In some special situations there is a shorter period applicable.

Group registration for taxable entities

In Slovakia, group registration for VAT is possible. Several taxable persons who have their seat, place of business or fixed establishment within the territory of the Slovak Republic and are financially, economically and organisationally connected, may participate in VAT group registration and as such be deemed as a single taxable person for VAT purposes.

Other specifications of the VAT registration

In Slovakia, a taxable person may become a VAT payer by law without previous registration. It may concern cases of real estate sale, business acquisition or part of a business by purchase or otherwise.

Besides the obligatory registration, Slovak taxable persons must register for the purposes of service delivery to other EU member states, or for the purposes of acquiring goods or services from other EU member states. Registration shall be done in advance.

VAT registration of foreign taxable persons

Definition of foreign taxable persons

Foreign taxable persons are entities without seat, place of business or fixed establishment located in Slovakia. The same rules are applicable on foreign persons having a fixed establishment in Slovakia as on domestic taxable persons.

Obligatory registration for foreign taxable persons

Foreign subjects in Slovakia are obliged to register for VAT before the commencement of an activity which is subject to VAT. The threshold for obligatory VAT registration due distance sale is EUR 35 000 per calendar year. VAT registration for distance sale must be done before the sale by which the threshold of EUR 35 000 will be reached within a calendar year.

Communication with authorities

Local statutory representation for VAT

In Slovakia, local representation by a tax advisor is not obligatory. However, foreign persons may need local representation in specific situations.

Statutory language

Only Slovak language may be used for communication with the tax authorities.

Communication with authorities

A taxable person can communicate with the tax authorities in electronic format, via the data box of the administration. However, a qualified electronic signature is required for the electronic communication.

VAT compliance and return filing

Tax period and deadline for VAT return filing

In Slovakia, the calendar month is considered as a tax period. A later change to calendar quarter is possible, but it is subject to several conditions.

The request for VAT return shall be filed till the 25^th day following the respective tax period.

EC sales list and other documents

The EC sales list shall be filed till the 25^th day following the respective period, which is in general the calendar month. The EC sales list may be filed for a period of calendar quarter if the value of delivered goods to other EU member states does not exceed the threshold of EUR 50 000 within a calendar quarter nor within the 4 previous calendar quarters.

Besides the VAT return, the control statement listing information from issued and received invoices must be filed as well.

VAT refund to EU member states

Minimum amount and applicable period

The value of requested VAT must be at least EUR 50 for the respective calendar year.

The VAT refund may be requested also for shorter periods than a whole calendar year, however such period shall not be shorter than 3 calendar months and the value of VAT must be at least EUR 400.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request is September 30 of the subsequent calendar year. The request for VAT refund shall be filed at the local tax authority in the other EU member state. The deadline for VAT return is 10 working days after laps of period for delivery of the decision made on the VAT refund, which may be between 4 to 8 months since filing VAT refund request.

Refund for foreign taxable persons

Upon the fulfilment of specific conditions. VAT refund for a foreign taxable person is possible.

VAT refund to third countries

VAT refund conditions

VAT refund to third countries is possible only upon the fulfilment of specific conditions, including reciprocity.

Minimum amount and applicable period for VAT refund

The value of requested VAT must be at least EUR 50 for the respective calendar year.

The VAT refund may be requested for the whole calendar year or for half calendar year. However, in case of the later, the value of the requested VAT has to exceed EUR 1 000.

Deadline and place of filing for VAT refund

The deadline for filing a VAT refund request falls on September 30 of the subsequent calendar year. The request for VAT refund shall be filed at the Tax office in Bratislava, Slovakia. The deadline for VAT return is 6 months after filing the refund request.

Penalties for VAT non-compliance

Depending on the nature of breach of the law, penalty for non-compliance can be imposed in form of fine, based on situation and severity, up to EUR 32 000, or in the form of interest, up to 10 % p.a. Delay interest for late payment is 15 % p.a.

The reduced VAT rates apply to a selection of goods and services specified by the local tax authorities.