There are some important changes coming into effect in Poland which may affect the way businesses have to account for VAT. The changes have only recently been finalised and are due to come into effect on 1 January 2014. Below are some of the main changes that may affect businesses:
Until now the tax point (the time VAT becomes due) has generally been the time when the invoice is issued. The new basic rule means that a tax point arises/VAT becomes chargeable as soon as the goods are supplied or services are performed.
Particular attention should be given where services are provided in stages as the tax point will be when the defined part of the service has been completed.
Continuous services also have special rules concerning when the periodical payments become due and for services supplied continuously over one year.
The rules regarding the tax base have been amended to reflect EU-wide legislation. The tax base will consist of any additional costs such as fees, packaging and transportation costs paid by a business but there are also items which should be excluded.
The changes also relax the rules regarding suppliers having to obtain from their customer proof that a credit note or corrected invoice which reduces the output tax due has been received.
Input VAT Deduction
Linked to the changes surrounding tax points, input tax incurred on purchases will become recoverable (subject to conditions), in the VAT period where goods were provided or services supplied to the purchaser. As before, a valid VAT invoice will also be required to enable deduction.
Where intra-community acquisitions are made, input tax will be deductible provided a valid VAT invoice is received within 3 months of the supply. Failure to receive this will mean the purchaser must adjust his records so that the input tax is not recovered.
Under current rules invoices should be issued no later than 7 days after the supply of goods or services. The main change in invoicing regulations will mean that suppliers of goods or services may issue invoices to customers within 15 days of the month following the supply. Invoices may also be issued up to 30 days prior to the supply of goods or services.
If you have any questions or think your business may be affected by the changes please contact us.