mailingLeitner Slovakia January 2023

Dear clients and partners,

Our following mailingLeitner Slovakia focuses on the most important changes in taxes and electronic communication.

• Amendment to VAT Act and Tax Administration Act
• Changes in timelines for testing and introduction of Real time invoicing
• Amendment to e-Government Act

We would be happy to assist if you need more information.

We for you,

Anna Fábryová & Martin Jakubec

Amendment to Value Added Tax Act

The amended VAT Act provides for some changes of the VAT legislation, with most important summarized in the following. The amendments have become affective from 2023:

• Changes in the registration duty: Taxable persons established in Slovakia and deriving turnover solely from the VAT exempt supplies of leasing of immovable property, insurance or financial services are not obliged to register for VAT and allowed to deregister.
• Changes related to correction of VAT due to bad debts: Taxpayers are under obligation to correct the input VAT originally claimed if the liability is overdue for more than 100 days. Suppliers are entitled to correct VAT related to the non-settled receivables, which have been overdue for more than 150 days. Simplified procedure has been introduced for receivables up to the amount of EUR 1,000. We recommend to check the due date policy and update internal control systems accordingly.
• Reduced VAT rate of 10 %: The reduced rate shall be applicable to personal transport by cableway line or ski-lift, admission to sport facilities and swimming pools as well as to the restaurant and catering services. However, the application of the reduced VAT rate shall be limited and effective only from 1 January until 31 March 2023.
• New obligations for payment service providers: If there are more than 25 cross-border payments in a quarter made to the same recipient, provider shall be put under obligation to keep records of cross-border payments and to provide the reports to the Financial Directorate on a quarterly basis. The relevant provisions shall apply as from 1 January 2024.

Amendment to Tax Administration Act

The Parliament also approved the amendment to the Tax Administration Act. Certain provisions become effective on 1 January 2023, others shall apply as from 1 January 2024. The most important changes are summarized below:

• “Second chance” to comply with the Tax Code: Before imposing penalties for the first violation of the Tax Code, the tax office shall request the taxpayer to comply with its obligations. The provision shall become effective as from 1 January 2024.
• Shorter time limit to impose interest on late payments: The tax office shall be obliged to impose the interest on late payments only within one year from the end of the year in which the arrears were paid (effective as from 1 January 2024).
• New provision regarding effective redress: For the purpose of extinguishing the criminality of a tax criminal offences under the Criminal Code, the tax may be levied and paid even after the statute of limitation for tax purposes is expired (applicable as from 1 January 2023).

Real time invoicing

• Timelines for testing and launching are delayed: From 1 January 2023, the e-invoice system is used by the Ministry of Finance and its suppliers. Starting April 2023, other departments of the Ministry of Finance including the Financial Directorate shall be included. Involvement of other state and public administration bodies is planned in the third quarter 2023. The launching of the e-invoice system for B2B transactions is also likely to be delayed.

Amendment to eGovernment Act

The Parliament also approved amendments to the e-Government Act. The amendments bring changes to the state’s electronic services, introducing simplification of electronic communication between citizens and the state and eliminating unnecessarily complicated processes that burdened citizens. Changes concerns following the following four areas:

• electronic mailboxes: introduction of clearer rules, by setting up and deactivating electronic mailboxes:
• authentication: access to the web portals of state institutions from mobile devices will be enabled, new methods of authentication will be introduced:
• guaranteed conversion: simplification of rules by creating electronic official documents; and
• integrated service points: cancellation, but the services remain at Slovak postal offices.

The amendments became effective in November 2022.