Last year, we sought to draw attention to the new reporting obligations of digital platforms (primarily known as DAC 7). By 31 January 2024, the affected internet platforms must submit a report to the Specialised Financial Office of the Czech Republic in the required electronic format containing information about the sellers, including the amount of revenue earned on their internet platform.

 The tax administration is reportedly receiving a large number of enquiries and phone calls about this new obligation. Allegedly, many internet platforms have not even reported yet, although a notification (similar to registration) should have been filed at the beginning of 2023, or possibly after the commencement of the notified activities.

Again, we note that the range of activities covered by DAC 7 is quite broad:

• provision of immovable property,
• provision of a means of transport,
• personal service (especially in this area, the scope can be very broad and unclear),
• sale of goods.

So, if you operate an online platform and are unsure whether the new obligation might apply to you, we would recommend a quick analysis of your business model. In the event of non-compliance, the tax administrator may impose a fine of up to CZK 1,500,000 in relation to DAC 7. Although we do not anticipate that the tax administrator should impose such high penalties in the first reporting period, it would certainly be advisable to avoid any inconvenience.

More information about DAC 7 can be found here.

Our specialists have been dealing with frequent enquiries from our clients in recent days and are fully prepared to provide you with the information you need. Therefore, please, do not hesitate to contact our colleagues Michal Hlaváč or Petr Němec.