From 2024, taxpayers will have a second chance if they violate some of their obligations (especially late submission of the VAT return, non-registration or late VAT registration). For which administrative offenses does the second chance apply and when will the taxpayer no longer be punished from January 1, 2024?
The amendment to Act No. 563/2009 Coll. on Tax Administration (Tax Code) introduces the institution of the so-called second chance for taxpayers. This change will come into force on January 1, 2024 and applies to administrative offenses committed after December 31, 2023.
Inpractice, the second chance institution means that the taxpayer will not be penalized for the first offense of any of the offenses covered by this amendment. The tax administration will ask the taxpayer to correct the first violation without imposing a penalty. A penalty is already imposed for each further violation.
Administrative offenses to which the second chance institute applies
The second chance institute applies only to those administrative offenses for which the fine is set within the established framework.
Here you will find an example of the administrative offenses and the extent of the fines that will fall under the second chance institute from January 1st, 2024.
- Later submitting of a VAT return within the statutory deadline – EUR 30 to EUR 16,000
- Later submitting of a VAT return within the deadline set by the tax office – EUR 30 to EUR 16,000
- Failure to submit a VAT after the deadline – EUR 60 to EUR 32,000
- Failure to comply with the VAT registration requirement within the prescribed period – EUR 60 to EUR 20,000
Every taxpayer receives a second chance for the first violation of the above-mentioned administrative offenses, whereby every taxpayer has a second chance separately against the tax office and against the customs office. For all of the above-mentioned administrative offenses, the tax and customs authorities will apply the second chance institute from January 1, 2024.
The application of the second chance in the event of a violation of one of the obligations is assessed separately for each administrative offense. This means that a taxpayer, for example, can not submit an advance VAT return on time without penalty (Section 154 Paragraph 1 Letter a of the Tax Code) and at the same time can not submit documents at the request of the tax administration (Section 154 Paragraph 1 Letter j).
The provision in question applies to all taxable entities. Thus, from January 1,2024, the tax office will monitor every taxable entity for violations of the obligations covered by the second chance, regardless of whether it is a natural or a legal person, and also regardless of whether the taxable entity fulfill sits obligations entry into force of the change to the tax code.
However, the second chance does not apply to administrative offenses such as:
- if the taxpayer states in the VAT tax return the amount that is lower than the VAT that should have been stated in the VAT tax return,
- if the taxpayer declares in a subsequent VAT return an amount that represents a tax increase compared to the amount stated in the VAT return,
- if the taxpayer enters in the subsequent VAT return an amount that represents a reduction in the excess deduction compared to the amount entered in the VAT return.
Since when does the institute of second chances apply?
The penalty is not imposed for the first violation of the above-mentioned administrative offenses, but it must also be satisfied that the taxpayer committed this administrative offense after December 31, 2023.
Example of a misdemean or to which the second chance institute applies.
A taxpayer does not submit his VAT return for the period 12/2023 on time, i.e. by January 25, 2024. Will such an administrative offense be punished?
The taxoffice will ask the taxpayer to comply with his obligation and will not impose a penalty, as this is the first violation of such an administrative offense after December 31, 2023. If the taxpayer does not submit the VAT return for the period 01/2024 within the deadline, that is, by February 26, 2024, he will already be penalized.
