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Zdeňka Svobodová | | January 10, 2023
The amendment to Act No. 586/1992 Coll., on Income Taxes, as amended (hereinafter referred to as the “ITA”), promulgated on 2 December 2022 in the Collection of Laws, issue 167, No. 366/2022 Coll., contains a new provision of article 30d of the ITA, which responds to the situation arising as a result of a misinterpretation in the area of monument protection in connection with the entry into force of Act No. 20/1987 Coll., on State Monument Care. Although this is old legislation, taxpayers may be dealing with its effects to this day.
According to the Act (No. 20/1987 Coll.), immovable property can be a cultural monument based on two grounds:
However, according to the information given in the explanatory memorandum to the amendment to the ITA, in practice the above mentioned was not reflected in some cases and some immovable property items, which were not cultural monuments before 1 January 1988, were considered to be cultural monuments even after that date, but were not covered by the transitional provision because they were not registered in the state list before 31 December 1987. As a result of this mistake, monument protection of some immovable property was incorrectly registered, for example, in the Land Registry, and their owners therefore treated them as cultural monuments all the time.
The Explanatory Memorandum to the amendment to the ITA further states that if a taxpayer supposed that his immovable property was a cultural monument in the period from 1 January 1988 and treated it as such for income tax purposes, he acted contrary to the law. In view of the fact that in such circumstances the tax subject should file an additional tax return for the relevant period, the new provision of article 30d of the ITA relieves the tax subject of these obligations by giving the tax subject the option to decide:
According to the wording of the new provision of article 30d of the ITA and the explanatory memorandum to the amendment to the ITA, there may be significant tax consequences for these immovable assets in the taxable period starting from 1 January 2022. If you are interested, we will be happy to help you with the correct tax depreciation of these assets.
If you have any questions about this issue, please do not hesitate to contact us.
Author: Martin Valentovič, Zdeňka Svobodová