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I filed the wrong tax return. What can I do about it?

Even a master carpenter makes mistakes sometimes. You file your tax return every year and have the whole process down pat, but you may still forget to declare an extraordinary income or forget a tax-deductible item that helps you reduce your tax.

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Two variants of tax correction

When you discover the miscalculation is crucial. If you discover the miscalculation before the filing deadline. This simplifies the whole process considerably. You file a corrected tax return and the original return is no longer taken into account. It won’t cost you an extra penny, and you can even do this several times.

Tip:

  • The deadlines for filing income tax returns are generally within 3 months of the end of the tax year for which the return is filed, typically by the end of March. In practice, the tax authorities interpret the Tax Code to mean that the last day of the tax return filing period is the day after the three months following the end of the tax year. For example, for 2024, the official deadline for filing a tax return is 2 April 2024.
  • Sole traders and businesses are required to file their tax returns electronically and are subject to a one month longer filing deadline. If a taxpayer has a data box, electronic filing is their obligation, otherwise an automatic penalty follows.
  • If someone’s tax return is prepared by a tax adviser (or your accounts must be approved by an auditor), you have a deadline of 6 months after the end of the tax year.

However, if you discover the error in April, for example, and the deadline for filing your return was the end of March, things won’t be quite so simple. But of course, there is a remedy. If you have paid less (or even more) tax than you should have, you can make an additional correction.

Both the correction and the additional return are filed on the same form as the regular return. You fill in the form again, only this time you enter everything correctly.

On the first page, you need to mark that it is a supplementary return. In addition, you need to state the reasons why you are filing it. If a difference in tax arises as a result of this additional return, you can expect to pay a penalty which will be calculated on the difference between the tax paid (or previously calculated) and the tax currently calculated.

If you have paid too much tax, it is not necessary to file a supplemental return. Rather, it is up to you. If you do, you have the right to claim a refund of the overpayment of tax, up to 3 years after the deadline for filing a proper tax return. The tax office should return it to you within 30 days of filing the additional tax return.

Penalties and fines for incorrectly calculated and paid tax

Penalties arise when the tax authority finds that the taxpayer’s declared tax calculation is incorrect and the correct amount of tax is different. The penalty is in fact a punishment for the incorrectly calculated tax. If you yourself file (in time) a supplementary tax return or a supplementary tax assessment, you are not liable to pay a penalty on the amount shown in the return.

The amount of the penalty varies depending on whether there has been an increase in tax, a reduction in the tax deduction or a reduction in the tax loss. Specifically:

  • 20% of the amount of the increase in tax,
  • 20% in the case of a reduction in the tax deduction,
  • 1% in the case of a reduction in the tax loss.

Are you unsure about the tax and tax return legislation?

Contact us. A finance and tax specialist will answer all your questions within two working days.

Late or forgotten tax returns

You will pay a penalty if you are late filing your return. It starts from the 6th working day of the delay, at the rate of 0.05% of the tax or tax deduction per day (0.01% for tax losses). However, the maximum amount of the penalty will not exceed 5% of the amount due (or CZK 300,000). If the fine is less than CZK 1 000, the tax authority will forgive it. For higher amounts, the tax office will send you a payment order.

Penalties also apply for late payment of tax. From the fourth day after the due date, interest on late payment starts to accrue, which is based on the repo rate set by the CNB. Even in this case, the state administration will forgive the penalty if its annual amount does not exceed CZK 1,000.

Don’t despair if the tax authority assesses you a penalty. You can still try to apply for a waiver.

If you file your return late, but the tax calculated is less than CZK 200, there is no penalty. However, if you don’t file a return at all, you could face a penalty of between CZK 500 and CZK 300,000. In addition, for each day you are late, you may be charged a penalty of 0.05-5% of the tax due or interest on late payment.

Interest on late payment is calculated on the basis of the annual repo rate set by the Czech National Bank plus 14 percentage points. For example, if the CNB repo rate on 1 July 2021 was 2%, then after adding 14 percentage points, the interest rate would be 16%.

Tip: With the abolition of property tax, it might seem that there are no tax obligations when selling and buying a flat or house. However, the opposite is true. Taxes still need to be kept in mind. Which ones apply to the seller and which ones do the buyer have to take care of? The answer can be found in a separate article.

When can I file a supplementary return?

You should file a supplementary tax return by the end of the month following the month in which you discovered the error. So if you find out about the error on 20 August, the deadline is the end of September. In addition, you could face a penalty of up to 5% of the tax assessed if you do not file on time. In addition, you are liable to pay interest for late payment of tax.

However, the tax office, which initiated the tax audit and discovered the error itself, can draw a line under your budget. In this case, you cannot file a supplementary return.

Tip: If there is an administrative error in the tax return, such as a missing signature or missing attachment, this is not an error that would require a new tax return. Although the tax office will ask you to correct it, you can usually just go to the relevant branch and fill in what is missing. However, if you do not correct it, they may issue you with a penalty notice, which can amount to up to CZK 50,000 in the worst case scenario.

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Author of the article

JUDr. Ondřej Preuss, Ph.D.

Ondřej is the attorney who came up with the idea of providing legal services online. He's been earning his living through legal services for more than 10 years. He especially likes to help clients who may have given up hope in solving their legal issues at work, for example with real estate transfers or copyright licenses.

Education
  • Law, Ph.D, Pf UK in Prague
  • Law, L’université Nancy-II, Nancy
  • Law, Master’s degree (Mgr.), Pf UK in Prague
  • International Territorial Studies (Bc.), FSV UK in Prague

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