Tax Authorities published template of Announcement on Reverse hybrid entity

Rules for a reverse hybrid entity were introduced into the Slovak Income Tax Act effective from 1 January 2022. Further, a new reporting obligation was added, for which the Tax Authorities published a template (available only in Slovak language).

Reporting obligation applies to:

• Partner of a partnership
• Unlimited partner of a limited partnership
• Recipient of income from subject with legal personality
• Recipient of income from subject without legal personality,

which are considered as Slovak tax non-residents and have direct or indirect share on registered capital, voting rights or profit of a reverse hybrid entity, in the amount of at least 50%.

The Announcement contains the information on tax regime of reverse hybrid entity in the tax residency country of person filing it.  

Deadline for filing of the Announcement on Reverse hybrid entity is end of calendar month following the month during which an individual became partner of a partnership, unlimited partner of a limited partnership or recipient of income and other legislative conditions were met.

In accordance with the transitional provisions the Announcement on Reverse hybrid entity must be filed also in case that the above conditions were met as of 31 December 2021 within 31 January 2022.

If you are not sure whether the above rules apply to your situation, please contact us.