According to the VAT Act, tax documents sent via e-mail cannot be considered valid “electronic documents” unless they contain an authorized electronic signature or mark or unless their authenticity of origin or integrity of content is guaranteed through the electronic data interchange (EDI).
Although the tax authority often accepts e-mailed tax documents as valid, this form of invoicing is not currently supported by any legislation. This could soon change, however. A draft amendment to the VAT Act which, in line with EU law, newly applies to tax documents has recently been approved by the Czech government. The amendment should take effect at the beginning of next year and should expand the range of permitted electronic documents to help reduce the unreasonable administrative burden placed on taxpayers.
What is considered a valid tax document?
A written document that complies with all statutory requirements is and will continue to be deemed a tax document, and it can take the form of a hard or soft copy. The difference that the amendment introduces is that an authorized electronic signature/mark or EDI guarantee will no longer be required.
As in the current version of the VAT Act, consent to electronic invoicing must be provided by the party to which the supply is rendered. The amendment, however, expands this requirement. The recipient of the supply must also give its consent to the use of electronic invoices, not only to electronic invoicing itself. The term “use of electronic invoices” is deemed to include disclosing and/or making available the same, including maintaining the tax document throughout its lifecycle as prescribed by law.
Another substantial change is that a tax document shall be unchangeable throughout its existence, i.e. additional information may not be added. The duty will be transferred to the area of tax record-keeping and will apply to both hard and soft copies. In addition, the change will have an impact on how a tax document’s date of issue is to be determined. According to the amendment, the date of issue shall now be the date which the issuer writes on the document. The general deadline for issuing tax documents will continue to be 15 days after the date of the duty to pay tax or the date of supply.
The tax entity is required to ensure that the origin of the tax document is trustworthy, the contents are intact, and the text is legible, and such duty shall be applicable throughout the tax document’s existence. Under the draft amendment, tax documents which are legible by sight and comprehensible for a human being without any further processing shall be deemed legible. The amendment, however, leaves the method for achieving this up to the tax entity. Nevertheless, businesses can expect a helping hand in the way of detailed instructions to be issued by the General Financial Directorate.