On 13 January 2014 it has been reported that there has been a major overhaul of the Polish VAT compliance regime following the approval of the 2014 Polish VAT Act. The changes are aimed at bringing the Polish Value Added Tax regime more into line with the EU VAT Directive. Areas of reform include the tax point, VAT base and input VAT.
Below is a summary of the main changes which came into effect on 1 January 2014.
Polish Tax Point
The condition on VAT being due only when a Polish VAT invoice has been issued has now been eliminated. Instead, the general rule of VAT becoming due upon the completion of the delivery of the goods or services will now prevail in all situations.
VAT base
For the purpose of calculating the amount subject to VAT, all costs associated with the provision of the goods or services must now be included in the base price. This has brought packaging, insurance and transportation costs into the taxable base for Polish VAT. Price discounts should also be taken into account when calculating the VAT due.
Intra-community supplies – input VAT
The right to deduct input VAT paid on intra-community supplies will now depend on receiving a support invoice within three months of the taxable supply being performed. If no invoice is received, then the transaction must be reversed.
In addition, the input VAT may only be deducted in the same period as the corresponding output VAT is declared in the VAT return.
