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Affecting both domestic and foreign businesses, a number of actions triggers the obligation to register for VAT in Slovakia. To provide a basic overview, our Slovak experts prepared a comprehensive eBook on value-added tax in Slovakia. Find out more about VAT rates, registration of taxable persons, communication with local tax authorities, compliance and VAT return filing, VAT refund to EU member states or third countries and penalties.
The basic VAT rate in Slovakia is 20%. 10% is the first reduced rate that is also applicable. 5% is the second reduced rate applicable for limited goods and services.
Although the reduced rate 10 % applies to a longer list that may change, in general, it may be applicable to pharmaceuticals, some medical products, books, dairy or meat products and accommodation. In any case, the actual product or service should be reviewed individually.
Following the special measure, which was adopted at the end of 2022 as a reaction to the crisis on energy market and with the aim to support tourist business, the reduced 10% rate shall apply from January 1, 2023 also to transport of persons by cable cars, ski lifts, access to indoor and outdoor sports facilities, admission to artificial swimming pools and restaurant and hospitality services.
The second reduced rate 5% is applicable from January 1, 2023 on the transactions related to state-supported residential rent.
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.
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.
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 20th 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.
Starting from January 1, 2023, domestic taxable persons who perform exclusively exempted activities such as financial, insurance services, delivery and rental of real estate are allowed to voluntarily decide whether to register for VAT purposes after the turnover threshold has been reached.
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 organizationally connected, may participate in VAT group registration and as such be deemed as a single taxable person for VAT purposes.
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.
For those taxable persons that perform e-commerce, it would be worth mentioning that as from July 1, 2021, the rules implementing the Council Directive (EU) 2017/2455 and Council Directive (EU) 2019/1995 entered into force. Further details are available here.
Foreign taxable persons are entities without seat, place of business or fixed establishment located in Slovakia. Otherwise, they are considered as domestic taxable persons, i.e., the same rules are applicable on foreign persons having a fixed establishment in Slovakia as on domestic taxable persons.
Foreign subjects in Slovakia are obliged to register for VAT before the commencement of an activity which is subject to VAT.
In the field of e-commerce, as from July 1, 2021, the rules implementing the Council Directive (EU) 2017/2455 and Council Directive (EU) 2019/1995 entered into force.
In Slovakia, local representation by a tax advisor is not obligatory.
Foreign persons may need local representation in specific situations.
Only Slovak language may be used for communication with the tax authorities.
A taxable person can communicate with the tax authorities in electronic format, via the data box of the tax administrator.
A qualified electronic signature is required for the electronic communication.
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 VAT return shall be filed till the 25th day following the respective tax period.
The EC sales list shall be filed till the 25th 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.
Starting from November 15, 2021, all registered VAT payers are obliged to report to Slovak tax administrator the numbers of all own bank accounts (payment, deposit), which the VAT payer will use for business that is a subject to tax under the Slovak VAT Act. This obligation applies both to bank accounts held with a domestic payment service provider and to accounts held with foreign payment service providers.
Newly registered VAT payers will be required to comply with the reporting obligation immediately from the date on which they became VAT payers or immediately from the date on which they set up such an account after they have been registered as VAT payers by the tax office.
VAT payers will be obliged to notify also any subsequent change, addition, or cancellation of notified bank accounts without delay.
The purpose of this measure is to publish, starting from January 1, 2022, the list of VAT payers’ bank accounts on the website of the Financial Directorate on a daily basis. Payment of the supplier’s invoice to a bank account which was not listed at the time of payment may lead to the application of the tax guaranteeing institute. Therefore, customers should pay increased attention to the supplier’s bank accounts, to which they will make the payment of invoices.
It also applies that tax office return the excess deduction only to one of the bank accounts notified to it by the VAT payer as part of the mentioned special notification obligation.
Following the transposition of the Council Directive (EU) 2020/284 into Slovak VAT legislation with effect from January 1, 2024, the payment service providers has new notification duty starting from January 1, 2024.
Domestic payment service providers are required to keep records of payees and cross-border payments in connection with the payment services they provide for each calendar quarter (25 cross-border payments or more to a single recipient), and at the same time to make these records available to the Financial Directorate of the Slovak Republic. Payment service providers shall retain relevant data, submit it to the tax authorities upon crossing the threshold by using a standardized electronic form (uniform across the entire EU) no later than till the end of the month following the relevant calendar quarter to which the information pertains. These records shall be sent by each member state to the Central European Payment System (so-called CESOP), where they are cross-checked and evaluated.
The aim of this is to combat tax avoidance in the field of cross-border e-commerce, as well as to check the correctness of the amount of tax declared.
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.
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.
Upon the fulfilment of specific conditions. VAT refund for a foreign taxable person is possible.
VAT refund to third countries is possible only upon the fulfilment of specific conditions, including reciprocity.
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.
The deadline for filing a VAT refund request falls on June 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.
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 3xECB rate or 10 % p.a. Delay interest for late payment is 4xECB rate or 15 % p.a.
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