The project assumes that Poland has the right to use the obligatory split payment in the period from March 1, 2019 to February 28, 2022. Please find below the most important information resulting from the draft derogation decision:
- the obligatory split payment applies only to transactions made between VAT registered taxpayers (B2B), which are subject to VAT in Poland;
- the obligation to use the split payment mechanism will cover selected goods and services;
- the obligatory split payment will only cover transactions settled with bank transfers;
- foreign entities settling transactions by means of bank transfers transactions subject to VAT in Poland will be obliged to open a bank account in Poland;
- an obligation to include information on the invoice on the use of a compulsory distributed payment mechanism will be introduced.
List of goods and services* in scope of the mandatory split payment:
- steel products, precious metals, non-ferrous metals;
- waste, scrap, recyclable materials;
- electronics – including: processors, smartphones, phones, tablets, net-books, laptops, game consoles, inks, toners, hard drives;
- fuels for cars, heating and lubricating oils;
- greenhouse gas emission rights;
- construction works;
- trade of parts for cars and motorcycles.
* the split payment mechanism can be applied,(as mandatory) to 152 product and service groups defined in accordance with the Polish Classification of Products and Services (PKWiU) from 2008
The Polish Ministry of Finance announced that it plans to implement a compulsory mechanism for divided payments in mid-2019. At present, there is no draft national legislation that would implement the decision of the European Commission.
What do you need to consider as a VAT registered taxpayer in Poland beforehand?
Firstly, it is necessary to determine to what extent the new regulation will affect your business.
Significant doubts may arise, for example, referring to the type of activity (trade in parts) and not specific goods. Our experience also indicates that the grouping of PKWiU does not always identify goods or services in a sufficiently unambiguous way.
The next step is to assess the scale of the phenomenon (% of sales / purchases will involve split payment) and verify what actions will be necessary to implement this mechanism. Account should be taken of finance (liquidity of the company), accounting processes (correct distribution, changes to compulsory elements on invoices, payment methods), settlements (implementation of the split payment obligation), legal aspects (contractual obligations regarding the method and mode of payment).
Should you have any additional questions, please contact:
Office: +41 58 792 2262 | Mobile: +41 79 339 9895
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