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Czech Republic: Corporate matters in the context of the coronavirus crisis
20.03.2020
Governments across CEE, including Czech Republic, have introduced or are discussing various measures to mitigate potential adverse consequences of the corona virus situation. This short overview summarises measures taken in the Czech Republic with respect to corporate housekeeping matters as of today. Due to the dynamic developments, we will update this overview regularly.
Tax Returns and Payments: most important measures announced on 23 March and expected to be implemented in April at the latest include: (i) corporate income tax: fines for late tax filing and late tax payments will not be imposed if payment is received by 1 July 2020, (ii) remission of the June tax advance on personal and corporate income tax: the June tax advance (i.e. the second advance for quarterly payers and the first advance for half-yearly payers) does not have to be paid, (iii) VAT: the Ministry of Finance will waive fines for failure to submit VAT control reports if the obligation to pay VAT arose in the period from 1 March 2020 to 31 July 2020, (iv) Tax loss carryback: tax refunds for the years 2018 and 2019 can be applied for by retroactively applying tax losses from previous years that had been carried forward based on the recently approved so called loss carryback.
Shareholder meetings: under Czech law, voting at shareholder/general meetings can be held per rollam unless explicitly excluded in the articles of association; however, the use of electronic means is only possible if expressly admitted by the articles of association. In order to meet the deadline of 30 June 2020 for the approval of the 2019 financial statement (so far this deadline remains unchanged), most companies will be able to hold their shareholder meeting per rollam which however requires the exchange of hardcopies. Companies with articles of association that do not provide for the possibility to use electronic means should consider to amend their articles to ensure their ability to act in case the functioning of postal services, notaries and other logistics will further deteriorate. Such amendment of the articles of association requires a Czech notarial deed but can be implemented based on a power of attorney.
UBO registration: No changes introduced or discussed so far (i.e. deadline for existing corporations elapsed on 1 January 2019 and deadline for trusts remains 1 January 2021).
Tax Returns and Payments: most important measures announced on 23 March and expected to be implemented in April at the latest include: (i) corporate income tax: fines for late tax filing and late tax payments will not be imposed if payment is received by 1 July 2020, (ii) remission of the June tax advance on personal and corporate income tax: the June tax advance (i.e. the second advance for quarterly payers and the first advance for half-yearly payers) does not have to be paid, (iii) VAT: the Ministry of Finance will waive fines for failure to submit VAT control reports if the obligation to pay VAT arose in the period from 1 March 2020 to 31 July 2020, (iv) Tax loss carryback: tax refunds for the years 2018 and 2019 can be applied for by retroactively applying tax losses from previous years that had been carried forward based on the recently approved so called loss carryback.
Shareholder meetings: under Czech law, voting at shareholder/general meetings can be held per rollam unless explicitly excluded in the articles of association; however, the use of electronic means is only possible if expressly admitted by the articles of association. In order to meet the deadline of 30 June 2020 for the approval of the 2019 financial statement (so far this deadline remains unchanged), most companies will be able to hold their shareholder meeting per rollam which however requires the exchange of hardcopies. Companies with articles of association that do not provide for the possibility to use electronic means should consider to amend their articles to ensure their ability to act in case the functioning of postal services, notaries and other logistics will further deteriorate. Such amendment of the articles of association requires a Czech notarial deed but can be implemented based on a power of attorney.
UBO registration: No changes introduced or discussed so far (i.e. deadline for existing corporations elapsed on 1 January 2019 and deadline for trusts remains 1 January 2021).
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