The subject of sales can be both goods and intangible assets such as licenses. To determine place of taxation for the sales of licenses to non-EU countries it is crucial to check if the sales is done to a private individual (B2C) or to business (B2B).
In case of B2B applicable would be art. 28b of the Polish VAT Act. According to this provision, the place of supply of services in such case is the place where the taxpayer who is the recipient of the service has its registered office. Consequently, these services are not subject to taxation in Poland, but on the basis of a reverse charge – in the country of the recipient.
Based on the art. 28l of Polish VAT Act and art. 59 EU VAT Directive in case of the provision to non-taxable entities with their registered office, permanent residence or usual place of residence outside the territory of the European Union (EU), services:
- for the sale of rights or the granting of licenses and sub-licenses,
- of transfer or assignment of copyrights, patents, rights to trademarks , trade,
- of putting into use of a collective trade mark or a collective guarantee mark or other related rights,
the place of supply of services is the place where they are established, have their permanent address or usually residence.
Given the foregoing, for the sale of the license to non- taxable person from a non- EU country, the place of service provision is outside Poland, in non- EU country mentioned above. In this case the reverse charge procedure is not applied. The sale of license for this customer obligates the seller to register to VAT purposes in the non- EU country where is located the place of residence of the customer. Furthermore the seller will settle the VAT based on the VAT law in force in this country. Additionally, the Polish taxpayer does not issue the invoice based on the Polish VAT rules. The transaction is settled and declared in the non- EU country.
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