The right to deduct input VAT is never automatic. In both Slovakia and Czechia you may deduct VAT only when the purchase serves your taxable business, you hold a valid tax document and you claim it within the legal time limit. The rules look similar, but two details differ sharply: how long you have to claim the deduction, and how each country treats hospitality and representation costs.
When does the right to deduct input VAT arise?
In both countries the right arises when the supplier’s VAT liability arises, not when you pay. Slovakia governs this in §49–51 of Act 222/2004; Czechia in §72–73 of Act 235/2004. In both cases you must be a registered payer, use the purchase for activities with a right to deduct, and prove the claim with a proper invoice or tax document.
The most common misunderstanding is the same in both jurisdictions: seeing VAT on a receipt does not create a right to deduct if the purchase does not serve your business or the document lacks the required particulars. Building the routine correctly from the start — as we outline in our overview of professional accounting in Slovakia — removes most of the traps below.
How long do you have to claim the deduction — Slovakia vs Czechia?
This is the sharpest difference. In Slovakia (§51) you must claim the deduction at the latest in the last tax period of the calendar year in which the right arose. In practice a monthly payer must capture an invoice by December of the same year, or the deduction for that year is lost.
Czechia is far more generous: under §73(3) the right can be claimed within three years, counted from the first day of the month following the period in which it arose. A late invoice that would be forfeited in Slovakia may still be fully deductible in Czechia. This single rule reshapes how carefully you must chase suppliers for documents in each country.
Which purchases can never be deducted?
Slovakia excludes VAT on goods and services used for hospitality and entertainment (§49(7)) — refreshments for a company party or entertaining business partners. Czechia excludes VAT on representation under §72(4): hospitality, refreshments and gifts that are non-deductible for income tax. Czechia, however, allows an exception for a promotional gift up to CZK 500 without VAT; Slovakia has no equivalent flat gift threshold.
In both systems the line between non-deductible representation and a genuine, deductible advertising cost is a frequent point of dispute. For how we help draw it, see our tax advisory overview.
How is the deduction reduced for mixed use?
Both systems reduce the deduction when a purchase serves taxable and exempt activities at once. Slovakia applies a pro rata coefficient (§49(4)–(5), §50) with an annual settlement; Czechia combines a proportional deduction (§75) with a reducing coefficient (§76), also reconciled after year-end.
The logic is identical: only the taxable share of overheads such as rent, energy or software is deductible. Claiming the full amount on shared costs is a classic error that leads to an assessment and a penalty in either country.
What if the invoice is incomplete?
Formal defects are not automatically fatal. In both countries a document missing some particulars can still support the claim if the substance is proven by other means — Czech §73(5) states this explicitly. But the burden of proof is on you, and the supply must genuinely have taken place.
The practical takeaway is the same on both sides of the border: keep orders, delivery notes, contracts and correspondence. An invoice with no real supply behind it will not survive a tax audit.
When must you repay deducted VAT?
Here the countries diverge again. Slovakia introduced a strict rule: if you do not pay a supplier and more than 100 days pass from the due date, you must reduce the deducted VAT (§53b, in force since 2023), restoring it only after payment.
Czechia has no such fixed 100-day trigger for the debtor. Instead it works through bad-debt corrections on the creditor’s side and, importantly, a guarantee for unpaid VAT (§109) that can make the customer liable for the supplier’s tax. Both countries also adjust deductions on long-term assets when their use changes.
How to avoid the trap of a risky supplier?
The most dangerous trap in both countries is unknowingly joining a VAT fraud chain — the authorities will deny the deduction if you knew or should have known. Czechia adds the “unreliable payer” register and the §109 guarantee, so paying such a supplier can cost you their VAT as well.
Basic diligence helps everywhere: verify the supplier’s VAT status, pay to published bank accounts, keep proof of a real supply and avoid deals that make no economic sense. Consistent documentation is the cheapest insurance against a denied deduction.
Not sure whether your input VAT is set up correctly in Slovakia or Czechia? We are happy to review your documents and processes so they hold up under audit.
FAQ
What is the deadline to claim input VAT?
In Slovakia you must claim it by the last tax period of the calendar year in which the right arose; in Czechia you have three years. A late invoice may therefore be lost in Slovakia but still be deductible in Czechia, which changes how urgently you must collect documents in each country.
Can I deduct VAT on entertaining clients?
Generally no. Slovakia bars deduction for hospitality and entertainment under §49(7); Czechia bars representation under §72(4). Czechia allows one exception — a promotional gift up to CZK 500 without VAT — while Slovakia has no comparable flat threshold.
Do I ever have to give deducted VAT back?
Yes. In Slovakia you must reduce the deduction if a supplier invoice is more than 100 days overdue (§53b). Czechia has no fixed 100-day rule, but bad-debt corrections and the §109 guarantee for unpaid VAT can produce a similar effect, and both countries adjust deductions on long-term assets when their use changes.