When are we subject to fines for inspection reports?
The severity of the fines associated with the control report has been the target of considerable criticism from the beginning, so now there is some relaxation of the penalties. As of July 29, 2016, penalties for the first offense are waived for taxpayers, it is possible to apply for a waiver of fines, and the period in which taxpayers are required to respond to the tax administrator's call is being extended. These are the main points of Act No. 243/2016 Coll., which amends some provisions of the Value Added Tax Act No. 235/2004 regarding control reporting. However, the amount of fines itself remains quite high. It is therefore good to know what to watch out for in connection with KH.
Penalties associated with late submission of Control statement:
If we file the inspection report late, but at the same time send it before the tax office informs us of the omission, we will automatically receive a fine of CZK 1,000. This penalty will be waived if it is our first offense in that calendar year. If we submit an inspection report only after the request of the tax authority within the replacement period, we will receive a fine of CZK 10,000 If we do not submit an inspection report even after a call from the tax office within the specified replacement period, we will receive a fine of CZK 50,000 Kč.
Sanctions associated with a late response to a summons by the tax office:
If the tax office finds doubts or ambiguities in the inspection declaration submitted by us, it will send us a request to remove the doubts in the data box. From the moment of delivery, the period within which we must react starts to run, otherwise we risk a hefty fine. The previous deadline was 5 days, now it is 5 working days. In this period, we must complete or change our original report by submitting a subsequent control report, or confirm it by choosing "Quick response to the call: I confirm the correctness of the last control report submitted".
If we fail to respond in time to the tax office call, we will receive a fine of CZK 30,000.
If we do not respond even within the replacement deadline, we will receive a fine of CZK 50,000.
It is possible to apply for a waiver of fines
It is now possible to apply for remission of fines of CZK 10,000, CZK 30,000 and CZK 50,000. The request for a waiver of the fine can be submitted no later than 3 months from the date of legal effect of the payment assessment, which decided on the obligation to pay this fine. Filing an application has a suspensive effect on the payment of the fine, i.e. until the decision on remission (or non-remission), the payer does not have to pay the assessed fine. When deciding whether to waive the fine, the tax office will take into account the circumstances of the case and consider whether there are justifiable reasons on the part of the entrepreneur. The tax administrator can waive the fine in full, in part, or reject the application.
A few notes from practice.
So far the tax authorities have been kind. Higher fines were imposed only four times. In the future, however, such leniency cannot be counted on. Also, the deadline for responding to the removal of doubts remains too short and the penalty for exceeding it severe. If an entrepreneur does not entrust the care of the VAT tax return to a professional accountant, he cannot afford to go on a longer vacation without a laptop with accounting.