Registration with the tax office

What it means

Registration is the entry in the list of tax subjects by which the tax administrator assigns a tax identification number. Electronic dealings with the office and the taxpayer account both follow from it.

It is not the same as VAT registration, which is a separate procedure ending in an IČ DPH number. A company can sit registered for income tax for years and never become a VAT payer at all.

The tax number is not to be confused with the company ID (IČO). The IČO identifies a business in the commercial and statistical registers, the tax number identifies it to the Financial Administration. An individual has one tax number even when trading, letting property and employing people at once; a new activity only means updated details, not a new number.

How it works in practice

Companies and trade licence holders are entered by the tax office on its own initiative, from the commercial register and the trade register. Notifying a trade at the single point of contact therefore needs no separate application.

Anyone the registers do not cover applies personally: a landlord with rental income from property other than bare land, or an employer starting to withhold payroll tax advances. The Income Tax Act sets the deadline: the end of the month after the month in which the duty arose.

After registration a company has to set up electronic communication with the Financial Administration, since businesses file returns and statements electronically. Where we keep the books, a power of attorney for our firm is recorded on the Financial Administration portal and we send the filings under our own access, so the client need not deal with certificates or logins.

What to watch out for

Landlords tend to assume the office will enter them the way it enters a company. It will not: the registration is theirs to file, and the penalty for missing it lands even when the rental tax was declared and paid on time.

Closing a trade licence does not by itself end the income tax registration. The duty to file a tax return for the year in which the business traded remains, as do the duties from letting or employing, and anyone who forgets that final return receives a request and a penalty just when the business is no longer on their mind.