Power of attorney

What it means

A power of attorney is a unilateral authorisation letting another person act in the principal’s name. It is defined by scope: a general one covers a broad range of acts, a special one only specific proceedings before a specific authority.

It differs from a mandate contract in function. The contract governs the relationship between client and provider; the power of attorney is what you show the authority so the representative can represent you.

A power of attorney is not to be confused with procuration. Procuration is entered in the commercial register and covers every act connected with running the business, whereas a power of attorney is granted outside the register and applies only to the scope written in it and only to the person it was given to.

How it works in practice

For tax matters the power of attorney is registered with the tax administrator so the representative can file returns, deal with a tax audit and receive served documents. Access rights to the official e-mailbox are set up the same way.

The scope is written precisely: which taxes, from which period, whether it extends to the social and health insurers. Too narrow a mandate means the managing director still signs half of everything.

A power of attorney for the tax office can be filed electronically through the Financial Administration portal, signed with the managing director’s qualified electronic signature. The Social Insurance Agency and the health insurers keep their own authorisations, so when we take on a client we check each institution separately so that no filing gets stuck.

What to watch out for

Revocation takes effect against the authority only once the notice is delivered - until then the former representative keeps receiving documents. So when changing accounting firms, powers of attorney are revoked and granted on the same day, not "at some point".

An s. r. o.’s power of attorney must be signed in the way the manner of acting entered in the commercial register prescribes. Where directors must act jointly and only one signs, the power is defective, the authority may treat the representative’s filings as invalid, and the deadlines keep running meanwhile.