If you run a business as a non-VAT payer and buy services from abroad or sell services to companies in the EU, you can very easily become an identified person. You are not a taxpayer in the full sense of the word, but you do have specific obligations: to declare and pay VAT in the Czech Republic on selected supplies received and to file a summary report on selected services supplied to the EU.
In this article, we explain when and why you become a tax-identified person, exactly how registration works, what you need to file and when, and highlight the mistakes people make most often.
Identified person is the term for a person who is not subject to VAT but meets the conditions defined by law and must register for specific obligations related to cross-border trade (typically B2B services in the EU or the acquisition of goods from the EU).
In practice, this means that you are not a taxpayer – you do not add Czech VAT to Czech invoices in the Czech Republic and you are not entitled to deduct it – but in certain cross-border cases you must declare and pay VAT in the Czech Republic or submit a summary report.
The law explicitly grants the right to deduct tax only to taxpayers, so the identified person does not deduct VAT.
If, as a non-taxpayer , you purchase goods from the EU, keep an eye on the limit of CZK 326,000 (the sum of the values excluding tax in the relevant year or the immediately preceding year). If you exceed the limit, you become an identified person and pay Czech VAT on such acquisitions.
The limit does not apply to new vehicles and goods subject to excise duty. Taxes are always payable there.
We can help you navigate the law, whether it’s dealing with a specific tax situation, preparing for an audit by the tax authority or defending yourself in court.
Once you receive a service from a foreign person outside the Czech Republic (typically advertising with Google or Facebook, SaaS tools, hosting) with a place of supply in the Czech Republic, you are obliged to declare tax in the Czech Republic as a recipient. There is no limit – the first service received is decisive. At that point, you become an identified person and must file a registration.
In practical terms: you pay Czech VAT on the amount of the invoice from Google, but without the right to deduct it because you are not a taxpayer.
If you supply a service to an EU business with a place of supply in another EU member state, you become an identified person from the date of supply.
A VAT payer adds output VAT on domestic taxable supplies and can claim input VAT as a deduction. In contrast, an identified person does not add Czech VAT on its ordinary domestic sales, but declares Czech VAT on selected cross-border supplies received and sends a summary report for selected services provided to the EU. He is not entitled to deduct the tax because he is not a taxpayer.
Yes. Even an ordinary person can become an identified person, typically when purchasing goods from the EU above the limit.
Yes, when you register, the tax authority will assign you a VAT number for VAT purposes. You will use it on documents for cross-border transactions.
No. If you become a payer, the identified person scheme is cancelled. The reverse is also true – the payer does not become an identified person.
Yes, you can request cancellation after the reasons have passed. You can read more about the conditions for cancelling an identified person’s registration in our article.
An identified person submits a VAT return for each calendar month in which he or she becomes liable to declare the tax (typically on a foreign service received or on the purchase of goods from the EU). The deadline is the 25th day of the following month and filing is done electronically. If no liability has arisen in the month, no return is filed.
When you supply a service with a place of supply in another Member State to a taxable person (B2B in the EU), you file a summary return as an identified person – also by the 25th day of the following month. You enter the customer’s VAT number and the value of the service. If you did not have such a supply in that month, you do not submit a summary report.
The identified person does not submit a control report. The law imposes the obligation to submit a control report exclusively on taxpayers and lists the situations when the taxpayer submits it. There is no such obligation for an identified person.
How do the obligations of VAT payers and non-payers differ? You can find the answer in our article.
VAT declared as an identified person is also payable within the same period as the submission – by the 25th day of the following month. You cannot claim the deduction as an identified person because the law only grants the deduction to the VAT payer and an identified person is not a taxpayer.
Ask yourself three questions:
An affirmative answer is sufficient and you are likely to be a taxable person (at the time of the first such transaction) and must file within 15 days. The filing must then be done online via the My Taxes portal.
The My Tax Portal is part of every business. Find out what you can find there and what you can do.
You are a non-VAT payer and pay CZK 9,000 for advertising with a company based outside the Czech Republic (e.g. Meta Platforms Ireland). The place of supply is in the Czech Republic (B2B rule), so you will declare Czech VAT at 21% on the amount of CZK 9,000, i.e. CZK 1,890. You file a VAT return by the 25th of the following month and pay the CZK 1,890. You cannot claim a deduction, so the total cost is CZK 10 890. The liability arises from the first service received (regardless of the limits) and you are therefore an identified person.
As a non-taxpayer, you provide a service worth EUR 2,000 to a German customer. The place of supply is in Germany (B2B rule), you invoice without Czech VAT with the note “the tax is paid by the customer” and submit a summary report by the 25th day of the following month. You do not pay VAT in the Czech Republic, but you become an identified person for the supply of services with a place of supply in another Member State.
As a non-taxpayer, you buy goods from several EU Member States during the year with an aggregate value of CZK 350,000 (excluding tax). You have exceeded the limit of CZK 326,000 and thus become an identified person. For new vehicles or excisable goods, the obligation would arise from the first purchase, regardless of the limit.
Are you planning to buy or sell a company car? Learn how to deal with VAT.
As an identified person , you do not issue domestic tax documents with Czech VAT because you are not a taxpayer. However, for B2B services to the EU, we recommend that you include the customer’s VAT number on the invoice and a clear note such as “Reverse charge – tax paid by the customer” (in a language suitable for the customer) and keep records for summary reporting.
“If I pay VAT in reverse charge, I can deduct it.” – You can’t. It is the statutorily defined taxpayer who is entitled to the deduction, not the identified person.
“Everyone must file a control report.” – No. Control reports are filed by the taxpayer in specified situations. A person identified for tax purposes does not file a control report. What he does file is a return and a summary report if there is a reason to do so in a given month.
“Registration is required only after the limit has been exceeded.” – Not always. There is no limit for receiving a service from a non-resident or for providing a B2B service to the EU – you become a tax-identified person on the first transaction.
“I have all the time I want to register.” – You don’t. The deadline is 15 days from the moment you become an identified person. Voluntary registration is effective only from the day after the notice of the registration decision.
The tax authority may impose a fine of up to CZK 500,000 for failure to comply with the registration obligation.
If you file your return late, there is a penalty for late filing – normally calculated as a percentage of the tax for each day of delay with an overall cap (maximum 5% and maximum CZK 300,000). However, there are also liberation rules (slight delays are not prescribed).
If you pay late, interest on late payment starts to accrue from the 5th working day after the due date at the CNB repo rate + 8 p.p. (in the first half of 2025, this works out at around 12% p.a.).
An identified person is not subject to VAT but has special obligations due to cross-border transactions. In particular, you become a taxable person in 3 situations:
You do not add Czech VAT on domestic sales and are not entitled to deduct it; you declare Czech VAT in reverse charge on cross-border supplies received and file a summary report for B2B services provided to the EU. Registration must be submitted within 15 days of the obligation arising. The identified person does not file a control report. The identified person files the VAT return only for the month in which the obligation arose and pays the tax by the 25th day of the following month (without deduction – it is a net expense).
No. You only file a VAT return for the month in which you became liable for the tax (e.g. you received a foreign service). You file a summary return for the month in which you supplied a B2B service to the EU. If you have no such supply, you file nothing.
Within 15 days of receiving the service you became an identified person. You file electronically through My Taxes.
From the day following notification of the registration decision.
Not sure how to do your taxes correctly so you don’t get it wrong? We can help you navigate the law, whether it’s dealing with a specific tax situation, preparing for an audit by the tax authority or defending yourself in court.
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.
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