Objektivní desetiletá lhůta a soudní řízení

As mentioned in previous alerts, the ten-year objective period for tax assessment represents the ultimate deadline by which the tax authority can assess a tax. Once this period has expired, the tax can no longer be assessed, regardless of any actions taken by the tax authority or the court during the proceedings.

If a tax dispute reaches the court, the actual running of the tax assessment period also depends on which legal regulation was in effect when the court proceedings were initiated—whether under the Tax Administration Act or under the Tax Code.

Under the Tax Administration Act, the running of the ten-year objective period for tax assessment was suspended during the court review. The purpose of this provision was to allow the tax authority to respond to the outcome of the court proceedings without the tax assessment period expiring in the meantime.

However, with the adoption of the Tax Code, the approach has changed. The running of the objective tax assessment period is no longer suspended during court proceedings. The legislator expressed the intention that the expiration of the ten-year tax assessment period would definitively close the tax proceedings, regardless of whether the court proceedings are still ongoing. This rule applies even in cases where the tax assessment period began to run under the Tax Administration Act, provided that the court proceedings were initiated under the Tax Code. Therefore, the decisive factor is the moment the court proceedings are initiated, not the beginning of the running of the tax assessment period.

The difference can be illustrated with a simple example. If a taxpayer filed an administrative lawsuit within the tax proceedings by the end of 2010, when the Tax Administration Act was still in effect, the running of the objective tax assessment period would be suspended during the court proceedings. The total length of the tax assessment period could thus be extended to more than fifteen years without the objective period for tax assessment expiring. However, if the lawsuit were filed in 2011, under the Tax Code, the running of the objective tax assessment period would not be suspended. Therefore, the tax assessment period would not exceed ten years.

In conclusion, we remind you that court proceedings can continue even after the ten-year objective period has expired. However, the consequences differ. If the court annuls the decision of the tax authority, the tax authority can no longer assess the tax because the period for tax assessment has expired. Conversely, if the court upholds the decision of the tax authority, that decision, assuming it was issued within the statutory period, remains valid.

Authors:

Ladislava Zamazalová

Karolína Moškořová