Czech Republic VAT (DPH) System

VAT in the Czech Republic

The Czech Republic follows a value-added tax system called DPH (Daň z přidané hodnoty). This indirect tax applies to goods and services sold within the country and to cross-border trade within the European Union. Administered by the Czech Tax Administration, VAT is an essential part of the nation’s fiscal framework.

📊 VAT Rates in the Czech Republic

As of 2025, the Czech VAT system includes three main rates:

🔹 Standard Rate: 21%

Applies to most goods and services such as electronics, vehicles, fuel, clothing, etc.

🔸 Reduced Rate: 12%

Applies to essentials like food, books, medicines, medical equipment, public transport, etc.

⭕ Zero Rate: 0%

Applies to exports and certain international services.

🏢 VAT Registration in the Czech Republic

✅ Local Businesses:

Czech-established businesses must register for VAT when their annual turnover exceeds CZK 2 million.

🌍 Foreign Businesses:

Companies based outside the Czech Republic must register for VAT before providing taxable goods or services.

📦 Distance Selling (EU E-commerce):

Businesses selling across EU borders must use the One Stop Shop (OSS) scheme if annual cross-border sales exceed €10,000.

🔢 Czech VAT Number Format

Czech VAT numbers begin with the country code CZ, followed by 8 to 10 digits.

Example: CZ12345678 or CZ1234567890

You can verify Czech VAT numbers through the EU’s VIES system.

🧾 VAT Invoice Requirements

Czech VAT law requires invoices to include the following:

• Invoice number
• Date of issue and supply
• Supplier and customer names + VAT IDs
• Description of goods/services
• Net amount, VAT rate, and VAT amount
• Total amount (with VAT)
• Currency (CZK or foreign)

Digital invoices are accepted if stored properly.

🧮 VAT Calculation Example

• Selling Price (Net): CZK 10,000
• VAT @ 21% = CZK 2,100

Total Price = CZK 12,100

📅 Filing VAT Returns

• Frequency: Monthly or Quarterly (based on turnover)
• Deadline: 25th of the following month
• Submission: Online via Czech Tax Portal

⚠️ Late filing or payment leads to penalties and interest.

🌐 Cross-Border and EU VAT Rules

B2B within EU:

0% VAT if both parties are VAT-registered and goods move between EU countries.

B2C within EU:

VAT must be charged in the buyer's country using OSS.

Imports from non-EU:

VAT paid at customs (can be deferred under certain schemes).

Exports to non-EU:

Zero-rated, provided valid export documents are kept.

🚫 VAT Exemptions in Czech Republic

Certain goods and services are exempt from VAT:

• Financial and insurance services
• Education and training
• Health and medical services
• Residential rent (non-commercial)
• Postal services
• Cultural and public interest activities

💸 VAT Refunds for Foreign Businesses

EU Companies:

Use the 8th Directive via their home country’s tax authority.

Non-EU Companies:

Claim under the 13th Directive, subject to reciprocity and possible appointment of a local tax agent.

✅ VAT Compliance Tips

• Always register when required to avoid penalties.
• Keep all sales records and invoices for 10 years.
• Use VIES to validate EU VAT numbers.
• File VAT returns and pay dues by the 25th of each month.
• Use OSS for eligible EU cross-border sales.
• Maintain proper digital or paper records for audit readiness.

Understanding the VAT system in the Czech Republic is key for both local and international businesses. Staying compliant with registration, invoicing, and filing requirements ensures smooth operations and avoids financial penalties. With evolving EU rules, digital reporting, and OSS schemes, staying informed is more important than ever.

👉 Use our Czech Republic VAT Calculator 🇨🇿 on GSTCal.org for fast, accurate VAT calculations.