VAT group registration allows entities that are linked through ownership or management and meet the statutory requirements to be treated as a single taxable person for VAT purposes. One of its main benefits is the potential simplification of VAT treatment for transactions between group members, as supplies made between individual members of the VAT group are outside the scope of VAT.

Companies considering establishing a VAT group effective from 1 January 2027 should pay particular attention to the approaching application deadline. Under the Czech VAT Act, the application must be submitted no later than 31 October of the relevant calendar year. However, as 31 October 2026 falls on a Saturday, the deadline for submitting the application is extended to Monday, 2 November 2026.

If the application is submitted on time, the VAT group will become a registered VAT payer effective from 1 January 2027. Unlike under the previous legislation, a late application no longer automatically results in the VAT group becoming effective from 1 January of the following year. Under the current legislation, an application submitted after the statutory deadline is deemed ineffective.

The registration application is submitted to the competent tax authority by the person designated by the prospective group members as the representative member of the VAT group. The application must identify all entities that are to become members of the group. Once registered, the VAT group is treated as a single taxable person for VAT purposes, and its individual members no longer act as separate VAT payers in this respect.

Before deciding to establish a VAT group, it is advisable to assess not only the implications for intra-group transactions and administrative obligations, but also the impact of VAT group registration on the right to deduct input VAT and other practical implications for individual group members.

If you are considering VAT group registration effective from 2027, please do not hesitate to contact us. We will help you assess whether the conditions for establishing a VAT group are met, evaluate its practical tax implications, and assist with the preparation and submission of the registration application.

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