As it was described on the blog post dated 21 March 2017 , the Supreme Administrative Court in Poland ruled last instance judgement which revoked the decisions of both District Administrative Court and tax authorities.
Previous news, based on an oral announcement, have recently been supported by the Polish Supreme Administrative Court’s final written justification in “Welmory” case and further clarifications were outlined.
In essence, the Polish Supreme Administrative Court agreed with the taxpayer that tax authorities and previous instance court misinterpreted given VAT provisions by drawing conclusions that:
- possessing technical and human infrastructure by the Cypriot company is not always necessary to perform given type of taxable activities;
- separate and independent legal entity (Polish Welmory company, which is a taxpayer conducting its own business activity) may at the same time create VAT fixed establishment for another taxpayer (in this case the Cypriot company Welmory);
- place of ultimate consumption of the services by end customers should be a factor of determining where the service is being used by the Cypriot provider;
- the Polish entity does provide sufficient technical and human infrastructure necessary for Cypriot entity to conduct its business activities, even though existence and exact details of such infrastructure have not been investigated nor evidenced by the tax authorities during its tax Audit.
Please find the link to the final judgement by the Polish Administrative Court:
Please find also the link to the judgement by the Court of Justice of the European Union C-605/12:
If you have any further questions regarding this topic, do not hesitate to contact:
Bozena Turek, VAT Manager
Kinga Zawora, VAT Assistant