An amendment to Czech tax law includes a provision that the statute of limitations for making a tax assessment does not run while there is a pending international request for tax information. This pause on the limitations period for assessment does not apply if the tax at issue is value added tax (VAT).
The Supreme Administrative Court recently issued a judgment concluding that with respect to income tax, the time limit for assessing tax does not run during periods when there are any pending international requests for information (regardless of when the limitation period on assessment started to run).
International requests for tax information, thus, have implications for the limitation period for assessing tax. Specifically, such international requests for information may take months (or even years). Thus, any pending tax inspections may be extended during this period of time, instead of the assessment being limited by the standard three-year time limit provided for assessing tax. If the inspection then results in an assessment of additional tax, the resulting late-payment interest will be based on the longer period including the information request.
Read a November 2019 report prepared by the KPMG member firm in the Czech Republic
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organization. KPMG International Limited is a private English company limited by guarantee and does not provide services to clients. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.