Current information regarding the judicature of the Court of Justice of the EU and judicature of the Supreme Administrative Court relating to the distraining of payment security orders.
Judicature of the Court of Justice of the EU (CJEU)
Ruling C-8/17 Biosafe related to the application of a VAT deduction claim which was reported additionally based on a corrective tax document. Originally, the payment provided by a supplier was billed at a reduced tax rate; however, the supplier subsequently corrected the VAT rate replacing it with the standard one but it did so only after the period for applying the VAT deduction that started on the date of issuing the original invoice had expired. The CJEU stated that a period to deduct the additionally reported tax cannot start before the relevant corrective tax document is available to the relevant taxpayer.
This opinion is in conflict with the VAT Act and has a high potential to change the practice in applying the Act.
Judicature of the Supreme Administrative Court (SAC) relating to the distraining of payment security orders
In its ruling 6 Afs 399/2017-26, the SAC has once again clarified the role that payment security orders may have in tax administration. It shows that a receivable arising from a distress warrant may be distrained for a time longer than the Financial Administration of the Czech Republic considered to be possible.
This ruling is more developed in the article Courts Have Once Again Sided with Entrepreneurs in Respect of Payment Security Orders.
The article is part of dReport – May 2018, Tax news; Grants and investment Incentives
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