Odlisnosti a podobnosti mezi ceskou a slovenskou DPPO opravy chyb

Differences and similarities between the Czech and Slovak CIT - mistakes corrections

In the previous parts of the series Differences and similarities between the Czech and Slovak CIT we informed you about the tax rate HERE, tax loss HERE and time relation of expenses with focus on "cash" basis HERE. We will now follow up on the last part and analyse cases of late recording of invoices in the accounting and correction via tax return.

Both in the Czech Republic and Slovakia, the so-called accrual principle generally applies, i.e., the tax base represents the difference by which revenues exceed expenses, while respecting their factual and time relation to respective tax period.

According to Czech rules, in case that the taxpayer's accounts do not reflect revenues/expenses related to the given period due to an accounting error, the taxpayer is obliged to/can file a supplementary tax return and correct the mistake. The Slovak rules allow, in a situation where the taxpayer in a previous period did not recognise an expense that is factually and time-related to the period (or recognised higher revenues than it should have), to correct it in the period when it became aware of the error. However, this procedure is not possible in the opposite case (missing or lower revenues in the previous period or booking of expenses that were higher than they should have been) and the taxpayer is obliged to correct the mistake through a supplementary tax return. In the Czech Republic, such a procedure is not possible in any of the above cases and the only way to correct the accounting mistake is through a supplementary tax return.

The (subjective) deadline for filing a supplementary tax return is set in both states by the end of the month following the month in which the taxpayer discovered an error.

Finally, we would like to add that the above brief commentary cannot replace a detailed tax assessment of a particular tax situation.

We will inform you about other differences and similarities between the Czech and Slovak corporate income tax in our next alerts.

Authors:

Gabriela Dias

Ladislava Zamazalová