Facebook ads and VAT in the Czech Republic: what non-VAT payers must do

Do you pay for Facebook or Instagram ads without being a VAT payer? VAT still applies to you. Your advertising is sold by Meta Platforms Ireland, a company in another EU country. When you buy this service for your business, you become a VAT-identified person (identifikovaná osoba) and must declare and pay Czech VAT yourself. The same applies to Google Ads, Canva, ChatGPT and foreign hosting.

What you need to do

1. Registration. Submit your application to register as a VAT-identified person within 15 days of receiving the first such service.
2. Return. For every month in which you received a foreign service, file a VAT return by the 25th of the following month. You do not file anything for months without foreign services.
3. Payment. Pay VAT of 21 % of the service price by the same deadline.

An EC Sales List (souhrnné hlášení) is only relevant if you sell services to businesses in other EU countries yourself. You do not file it just for buying advertising.

Example

In October, you pay Facebook 10 000 Kč for advertising. VAT at 21 % is 2 100 Kč. File the October return and pay the tax by 25 November. You pay Facebook 10 000 Kč as before; the 2 100 Kč goes to the tax office.

Invoices in euros

If Meta invoices you in euros, the amount is converted using the Czech National Bank (ČNB) exchange rate. Please send us the full invoice from your advertising account, not just the amount on your bank statement. You can find the invoice in Ads Manager under Billing.

If you have not dealt with this yet

You are not alone: this is a common mistake. The sooner you register and file for missed months, the lower the penalties and late-payment interest usually are. We will review your invoices, find out which months are missing returns and prepare them (290 Kč per month).

I use the flat-rate tax regime. Does this apply to me?

Yes. A VAT-identified person can stay in the flat-rate tax regime (paušální režim). However, they must still file monthly VAT returns for foreign services. IO Paušál is the package for you; IO Komplet is for everyone else.

This information is general and does not replace an individual assessment.