Poland: Changes Regarding Polish VAT Tax Point

The rules defining the specifics of the VAT tax obligation in Poland have been changed in compliance with the EC VAT Directive 112.

On January 1, 2014, the rules concerning the moment the VAT tax obligation arises changed significantly in Poland. According to previous regulations, the tax obligation typically arose at the moment the invoice was issued. If the invoice was not issued within the statutory period of seven days from the date of delivery of goods or performance of services, the tax obligation arose seven days after the occurrence of these events.

For sales made at the end of the VAT settlement period, taxpayers had the opportunity – by issuing an invoice at any convenient time – to affect the settlement of the VAT tax, making the VAT come due in the settlement period in which the sale was actually made or in the next period (if the taxpayer issued the invoice in the next settlement period, not later than seven days from the date of sale).

The VAT tax point arises
Directive 112 on VAT establishes the general rule that the VAT tax point arises upon delivery of goods or performance of services (Art.63). This Directive includes exceptions regarding certain transactions and certain categories of taxable persons to allow Member States to determine the tax point at another time (e.g. at the time of invoice issue or, in the absence of invoice issue in accordance with the rules, in a specific period from the date of sale).

In light of Directive 112, the Polish regulatory bodies had concerns about the compliance of existing Polish regulations on the VAT tax point with EU regulations and have changed them accordingly. Since 2014, the tax point rules specified in the Polish VAT legislation correspond to the general principles laid down in Directive 112 – i.e. the tax liability arises upon completion of delivery of goods or performance of services (Article 19a. 1 of the VAT Act).

If payment is received prior to the sale, the Polish regulations remain unchanged; the tax point in this case is the payment receipt date. Compared with the regulations in force before 2014, the scope of taxable transactions for which a specific way to determine the tax point existed has been significantly reduced.

In connection with the amendment of VAT regulations, the taxpayers conducting business in Poland should review the correctness of the principles they apply in defining the VAT tax point.

Author
Arkadiusz Malec
arcadiusz.malec@ecovis.com