Yes, basically. But if you want to be really literal, I'd say it's more like 'Are you this/that?'
Note that there is a difference between the pronoun 'ono' = 'it' and the demonstrative 'to' = 'this/that' ('to' is the neuter sg form of 'ten'). 'Ono' is not used much in Czech and is usually replaced by 'to'.
I am learning Czech and was surprised by this also. But then I thought of the German equivalent: "Bist Du es?" which has the same structure as the Czech. My thinking then is that in Czech/German, "You" is the subject (and determines the form of the verb) and "it" is the complement. Wheras in English it is the other way around.