121. rulebook on implementation of the law on value added tax

<strong>121.</strong> RULEBOOK ON IMPLEMENTATION OF THE LAW ON VALUE ADDED TAX
entity that are considered to be goods in the functional sense.
Article 4
(1) Services are considered to be any supplies effected for consideration, which are not
considered to be supply of goods.
(2) The services also include the transfer, assignment or use of copyrights, patents, licenses,
trademarks and other property rights.
(3) If a single supply has at the same time traits of a supply of goods and traits of a supply of
services, traits determining the factual business content of the supply shall, having regard to the
will of contracting parties, serve as demarcation factors.
(4) In the event of repairing goods and for the purpose of making a distinction and determining
whether a supply could be considered as a supply of goods or services, the share of the material
procured by the taxpayer (doing the repair) within the total compensation shall be relevant. If the
share of the compensation relevant to the material exceeds 50% of the total amount of the
compensation relevant to the repair of goods, in such case it is the supply of goods and vice
versa.
2. Refining and manufacture of goods from material provided by the ordering party
Article 5
(1) If an ordering party provides the manfacturer with material to be processed, worked, finished
or used to manufacture a specific product, the delivery shall not be a taxable supply since the
ordering party shall retain the right to dispose with the material.
(2) If the manufacturer referred to in paragraph 1 of this Article retains, after refining the
material, by-products or waste exceeding 5% of the value of its supply that were to be returned
to the ordering party, this shall be considered as a supply of goods effected by a ordering party
to the manufacturer upon which VAT shall be charged.
(3) If the ordering party referred to in paragraph 1 of this Article provides the manufacturer with
material, parts or components without retaining the right to dispose with the deliveries but
instead paying manufacturer’s deliveries or counter deliveries this shall be considered as a
taxable supply or an exchange.
3. Exchange
Article 6
(1) If a supply of goods or services has not been effected for a monetary compensation but
instead for a delivery of another goods or services, this shall be considered as exchange of
goods or services.
(2) In the event of exchange, deliveries shall be taxable at both suppliers of goods or services.
4. Return of goods
Rulebook on Implementation of the Value Added Tax Law 3