Right Payment Options and Tax Deduction Options

In addition to the advance payment of tax and tax deduction, deferral and installment payment are also possible, e.g. for the payment of the settlement on the basis of the annual tax return, VAT return, excise duty, inspection decision.

The Notable Options

It should be noted that the taxpayer can also request a deferral or installment payment of liabilities after the annual DDPo statement has been submitted, even though the latter was submitted before the epidemic was declared if the payment of liabilities was hampered by loss of income due to the epidemic.

In the application submitted or exceptionally via e-mail, the taxpayer states the facts and attaches evidence showing the loss of ability to generate revenue due to the epidemic (for example, the Ordinance on the temporary ban on offering and selling goods and services to consumers, loss orders, cancellation of business partners’ contracts, etc.). There the use of taxfyle’s tax calculator comes quite useful.

Postponement and exemption from paying contributions to the self-employed

Who is entitled to defer social security contributions and for what period?

Self-employed people who have no other employees are automatically entitled to defer all four types of social security contributions, and this employment is their only basis for inclusion in compulsory social insurance i.e. full-time employees, farmers and other natural persons performing activity (e.g. lawyers, journalists, etc.) Afternoon spers are not entitled to a postponement.

  • Deferment is possible for contributions due in April, May and June. Deferred contributions must be paid by the taxpayer no later than 31.3.2022, which can be done in a lump sum or in installments. Deferred interest also does not accrue default interest.
  • However, self-employed persons with outstanding liabilities that are due by 28 February 2020 and are higher than EUR 50 are not entitled to deferment if they are not settled by 6 April 2020.

Who is entitled to an exemption from social security contributions, for what period and what is the procedure?

The self-employed (not the afternoon sp), religious employees, partners and farmers are entitled to exemption from contributions. Such a person must also have overdue tax liabilities settled on the day of the application and must meet the same conditions as for obtaining a monthly basic income.

Exemption from payment can be requested for March, from 13.3.2020 (due on 20.4.), April (due on 20.5.) And for May (due on 20.6.). For exemption from payment, the taxpayer submits a statement (same as the one for the allocation of monthly basic income), which will be available to users from 14.4. forward.

Monthly basic income for the self-employed

Beneficiaries are the self-employed, partners, religious employees and farmers who, due to the epidemic, are unable to carry out their activities or perform them to a significantly reduced extent and have no outstanding tax liabilities on the day the law enters into force. Significantly reduced business volume means a reduction of at least 25% in the beneficiary’s revenue in March 2020 compared to February 2020 or at least a 50% reduction in the beneficiary’s revenue in April or May 2020, compared to February 2020. 

Because business events are recognized when they occur and not just upon payment, this means that the reduction in revenue will be judged according to the rules of accounting standards – revenue will be recognized when the service or delivery is performed, regardless of whether the invoice is issued or paid.

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