Last updated: 02.02.2018
Split payment mechanism on Polish VAT
As from 1st of July 2018 new VAT regulation implementing a mechanism called split payment will come into force.
General idea: Payment for an invoice will be split between two bank accounts: net value will be transferred to the regular bank account and the VAT value will be transferred to the VAT bank account.
1. Using split payment will be voluntary
2. VAT bank accounts will be opened by the banks automatically and free of charge for all taxpayers, provided a taxpayer has a regular bank account in Polish bank
3. VAT bank accounts will be kept in PLN. In case the invoice is issued in other than PLN currency the invoice has to indicate the amount of VAT in PLN, hence there is no need to convert the currency by the seller.
4. Payments via split payment will be made in PLN
5. Money from VAT bank account can be generally used only for VAT connected activities i.e. mainly:a. to pay VAT to the suppliersb. to pay VAT due to the tax office
6. It will possible to transfer the money from the VAT bank account to a regular bank account upon receiving a permission from the tax office (the decision can take up to 60 days) and may be subject of the tax audit.
7. Split payment will be used only in transactions between active VAT payers
8. On the request from a taxpayer to make the refund on a VAT bank account there will be 25 days period for the refund instead of regular 60 days.
Note: Even if a taxpayer does not want to use the bank VAT account, it will be opened automatically by the banks, so possibly the taxpayer may receive payments for VAT from his clients on this account. Therefore it is especially important to be aware of the new regulations regarding split payment.
Polish government will be encouraging the tax payers to use split payment. Incentives consist of:
a) releasing the taxpayers that are business customers (hereinafter taxpayers) from the sanctions for incorrectness in its VAT reconciliations arising from the invoices paid in the split payment mechanism,
b) releasing the taxpayers from joint and several responsibilities related to sensitive goods purchases (among others: part of steel products, fuel, heating oils, lubricating oils), and
c) granting the taxpayers, the accelerated VAT refund procedure, which will let to shorten the deadline for VAT refund from 60 to 25 days only.
The details of the changes are available at this link: http://prawo.sejm.gov.pl/isap.nsf/download.xsp/WDU20180000062/O/D20180062.pdf
Unfortunately, the content is available in Polish only.