Tax

Significant Amendment to the Real Property Tax Act

Real property tax is determined on the basis of data recorded in the land registry; however, in case of discrepancy between the data and the actual state of affairs, the current practice gives preference to the actual state of affairs. Although the related case law has long preferred this approach, the tax administrator has not always accepted it. The proposed amendment to the Real Property Tax Act should bring a significant shift in this matter. How can it affect specific tax liability? 

23. 10. 2020

Upcoming amendment to the Act on Investment Incentives will allow extending deadlines for complying with conditions

In response to the current pandemic situation, the government brings another support measure (Document of the Chamber of Deputies no. 1059) that would allow investment incentive recipients to extend the deadline for complying with general statutory conditions by up to two years. The proposed draft bill is being discussed in a state of legislative emergency, so it can be expected to come into effect very soon. 

23. 10. 2020

Loss of investment incentives in relation to transfer pricing

The Income Taxes Act (ITA), as amended until 30 April 2015 (“the old wording of the ITA”), specified that if the corporate income tax payer increased the tax base by conducting related party transactions in a way that did not comply with the economic principles of ordinary business relations, it would denote a breach of conditions for drawing investment incentives in the form of tax relief, leading to a subsequent loss of investment incentives. This provision was amended with effect from 1 May 2015 (“the new wording of the ITA”): currently, in the case of a breach of the aforementioned conditions, the loss of investment incentives will not be complete and will not affect all periods in which the tax relief was or could have been claimed. 

22. 10. 2020

VAT news: tax deduction advance

An amendment to the Tax Code brings a new tax institute effective from 1 January 2021, which allows the payment of a tax deduction advance (“advance”) before the tax deduction is determined, i.e. before a tax assessment decision is issued. Although the possibility of obtaining a portion of the excessive deduction even before the tax procedure is concluded is positive for some VAT payers in terms of cash flow, we find it important to point out the difficulties that can be associated with the payment of the advance. 

22. 10. 2020