An invoice, known as daňový/účetní doklad/faktura in the Czech Republic, functions as a formal request for payment concerning services or goods rendered. While specific regulations governing its preparation are absent in Czech law, there are essential data requirements outlined for inclusion in an invoice.
Issued at the time of service provision or goods shipment, the invoice serves as a replacement for the customary Certificate of Completion and Bill of Lading.
A proforma invoice, zálohová faktura, acts as an advance invoice for prepayments. When generating an invoice for prepayment purposes, it's advised not to use a daňový/účetní doklad/faktura since the actual service or goods sale hasn't occurred yet. Instead, utilize a proforma invoice, a document not classified as a tax document and doesn't enter accounting records. Non-payment of a proforma invoice doesn't necessitate reversal or credit procedures.
Entrepreneurs fall into three categories:
- Non-VAT payers without accounting procedures
- Non-VAT payers with accounting procedures
- VAT payers and Identified VAT persons (identifikovaná osoba)
Each category adheres to specific invoice information requirements.
For Non-VAT Payers without Accounting Procedures:
If operating as an individual entrepreneur (OSVČ), an invoice must align with Civil Code № 89/2012 Sb., občanský zákoník (§ 435).
The invoice must encompass:
- Company name (legal entity, e.g., s.r.o., etc.)
- First and last name (for natural persons = OSVČ)
- Company's legal address (sídlo) or residence address
- Registration number (e.g., IČ)
- Register name where recorded (e.g., obchodní rejstřík, živnostenský rejstřík, etc.)
- Additionally recommended: buyer information, product details, invoice issuance and payment due dates, document type (e.g., "faktura"), invoice number, statement of non-VAT payer status, foreign currency exchange rate.
For Non-VAT Payers with Accounting Procedures:
Non-VAT payers maintaining accounting records, including companies and individual entrepreneurs, follow the guidelines from Law on Accountancy № 563/1991 Sb., o účetnictví (§ 11).
The invoice should encompass:
- Your company's details (name, address, registration number)
- Statement of non-VAT payer status
- Buyer's information (company name, address, registration ID, etc.)
- Service/product details, quantity, pricing, currency exchange rate for foreign transactions
- Additional: document name ("Faktura"), invoice number, issuance date, service/goods provision date, client's signature, and accountant's signature for recording in accounting books.
For VAT Payers or Identified VAT Persons:
VAT payer or an Identified Person to VAT adheres to invoice content stipulated in VAT Law №235/2004, o dani z přidané hodnoty (§ 29).
The invoice requires:
- Your company's particulars (name, address, registration and tax numbers)
- Buyer's information (company name, address, registration ID, etc.)
- Service/product details, quantity, pricing, currency exchange rate for foreign transactions
- Inclusion of subtotal, VAT details, total amount
- Essential details: document name ("Faktura – daňový doklad"), invoice number, tax document number, issuance date, VAT obligation date, client's signature, and accountant's signature for recording.
Issuing Invoices for Foreign Transactions:
When invoicing outside the Czech Republic, consider:
- Displaying bank details in international formats (IBAN, SWIFT/BIC)
- Stating currency, exchange rates, and VAT amounts
- Mandatory phrasing depending on VAT modes and transaction locations (see "mandatory wording/comments" below).
Mandatory Phrasing Examples:
For transactions within the Czech Republic or abroad, specific phrases are required to denote VAT obligation modes, exemptions, or special cases.
For Sales Outside the Czech Republic:
- Display bank details in international formats (IBAN, SWIFT/BIC)
- Specify currency, exchange rates, and VAT amounts
- Essential phrasing as per VAT modes and transaction locations (see "mandatory wording/comments" below).
Mandatory Phrasing Examples:
- For transactions within the Czech Republic or abroad, specific phrases are required to denote VAT obligation modes, exemptions, or special cases.
- "Reverse-charge" – in B2B services sold outside the Czech Republic (to firms or individual entrepreneurs from the EU or outside EU countries), include the phrase:
- CZ: "Faktura je v režimu přenesené daňové povinnosti. Daň odvede zákazník."
- EN: "Invoice in Reverse charge mode. The buyer is obligated to fill in the VAT amounts and pay the tax."
- "Dodání osvobození od daně" – for invoicing to another EU country without adding VAT on goods:
- CZ: "Osvobozeno od daně podle zákona o DPH č. 235/2004."
- EN: "Tax exemption according to VAT Law no. 235/2004."
Mandatory Phrasing for Sales Within the Czech Republic:
- "Zvláštní režim podle § 89 ZDPH" – for travel/tourism service providers or intermediaries (only markup on the product is subject to VAT)
- "Zvláštní režim podle § 90 ZDPH" – for sellers of used goods, works of art, collectibles, and antiques (only markup on the product is subject to VAT)
- "Přenesení DPH podle § 92a zákona o DPH" – transfer of responsibility for VAT within the Czech Republic between two VAT payers in specific cases:
- sale of gold (§ 92b)
- sale of goods specified in Appendix 5 of the VAT Law (waste and scrap) (§ 92с)
- sale of real estate subject to certain conditions (§ 92d)
- sales of construction and installation work (§ 92e)
- other cases (§ 92ea).
