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1.The length of the stay is not always decisive
It is often a neglected fact for employers that, even in the case of a multiple-day work trip, a confirmation from the social security administration confirming the affiliation to the legal rules of the employee in the home country should be provided in advance. Local authorities may require such a confirmation from the employee and its non-documentation results in not so tiny sanctions.
It is also important to remember the limitation of the exemption from taxation in the state of posting (183 days of physical presence). It is not possible to use the exemption in case the payer is not tax resident any more. Furthermore, its use makes the existence of a permanent establishment of a Czech employer in the state of posting impossible, which shall pay the wages of the posted employee.
2. Setting-up the structure in advance
A common mistake is also the poorly defined structure of posting or its solution after beginning the posting. it is necessary to treat the posting lawfully with regards to the labour laws- (a work-trip, change of place of work or conclusion of employment contract according to the laws of the posting states), and setting-up the adjustments to the relationship between the posting employer and the receiving subject in accordance with the labour law, in case it is relevant. It can be an international labour hiring, providing the services or other specific form of cooperation. The subject should be written in the agreement.
3. Type of posted employee
The relatively well-known provisions of the contracts on the avoidance of double taxation related to income is a dependent activity. It is necessary to properly study the specific contract, because for some of types of employees, the regime is different. These are, for example, the managing directors of companies, university professors or research workers.
4. Stopping advance obligations in the Czech Republic
If the tax liability moves into the state of posting because of the posting, the employer must provide a decision from the tax office, on the grounds of which the company can abandon the advance obligation in the Czech Republic.
5. Announcing changes in the relevant facts
If the employer ensures the needed confirmation, then he or she has to observe all the facts, which he or she documented in the submitted requests. In case any changes in some of the facts, the confirmations and decisions of the offices can become invalid.