Being tax compliant is always an issue when selling online. Of course, there are several reasons that might require a proper VAT registration. The annual threshold limit for distance selling is one of them. This article give a brief overview on the VAT Threshold Limit in the Czech Republic.
VAT Threshold Limit: Czech Republic
Besides founding a company or storing goods abroad, an EU VAT registration for an EU-company is required when this company is selling goods across EU borders directly to consumers who ordered via internet or catalogues for example – that is known as Distance Selling.
For example, when you are selling your goods from Germany to customers in Poland, the VAT registration is only necessary if the annual threshold limit of the country of import is reached. Threshold Limit Czech Republic: when importing to the Czech Republic for example, the annual threshold limit is about about 43 300€.
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Threshold Limit Czech Republic in CZK, USD & EUR
|VAT Threshold Limit Czech Republic||1 140 000 CZK||~ $46 000||~ 44 300€|
If a foreign company is selling below the corresponding thresholds, it does not need to be registered for a VAT number. Once over these limits within the same calendar year, it must apply for a EU VAT number and it is highly recommended to do so.
The good news is that you will not have to step up any foreign subsidiaries. In case of reaching the threshold in different countries you need to register in these additional countries as well.