What are the conditions for the call-off stock procedure in Poland (concerns movements of goods from a Member State to Poland)

The procedure of the call-off stock takes place if the total is fulfilled are the following conditions:  

  1. goods are dispatched or transported by a VAT taxable person or by a third party acting on his behalf from the territory of the Member State other than Poland on the territory of Poland for their deliveries at a later stage and after their entry into the warehouse in the call-off stock procedure to another taxable person, entitled to acquire the right to dispose of these goods as the owner, in accordance with a previously concluded agreement between these taxable persons; 
  2. a VAT taxable person dispatching or transporting goods does not has its registered office or permanent place of business of economic activity on the territory of Poland; 
  3. the taxable person to whom the goods are to be delivered is registered as an EU VAT taxable person, and his company name or first and last name and tax identification number preceded by the PL code are known to the VAT taxable person sending or transporting the goods at the time the shipment or transport begins; 
  4. a VAT taxable person dispatching or transporting goods registers the movement of goods in the records referred to in Article 54a paragraph 1 of Regulation (EU) No 282/2011, and provides in the information corresponding to the ECSL lists referred to in Article 100(1)(5), a Tax identification number referred to in point 3.

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Polish economy in the time of COVID-19

The coronavirus pandemic and the global lockdown had an extraordinarily strong impact on the economies of all countries in the world.

However, according to the World Bank expert, the Polish economy is more resilient than others, and the fiscal situation in Poland is noticeably better than in other countries of the region.

The factors that help Polish economic situation are:

  • support from the World Bank,
  • quick interventions of the National Bank of Poland providing the necessary liquidity for the banking sector through the program of quantitative easing of monetary policy – the value of the purchases of bonds amounted to nearly 4% GDP,
  • the amount of debt in relation to Poland’s GDP is one of the lowest in the European Union, thanks to which the government has a budgetary space to respond to the crisis.

Polish government introduced many changes for entrepreneurs, which are to support them in conducting business in difficult conditions caused by COVID-19 (e.g. exemption from paying social security contributions, changes in the labor law).

The coronavirus pandemic has slowed down the Polish economy, but it also became a catalyst for the development of the e-commerce industry.

Consumers wanting to avoid the risk of contracting the virus more frequently decide to purchase through the Internet. In response to the growing demand for online shopping, more and more stores are choosing to sell online.

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Changes in VAT on import in Poland

As from 1 July 2020, changes in VAT settlements on import have entered into force in Poland. They are aimed at improving the competitiveness of Polish ports. Taxpayers will be able to settle the tax on the import of goods directly in the VAT return.


Pursuant to the amendment to the regulations, it will be possible to settle the amount of VAT due on the import of goods in the VAT report, regardless of whether the goods have been subject to simplifications from the EU Customs Code. Settlement of the VAT directly in the VAT return will cover the whole import of goods, i.e. both covered by customs simplifications and covered by customs declarations under general rules.


The simplification will apply to taxpayers :
– registered as active VAT payers,
– making customs declarations by a direct or indirect representative within the meaning of customs regulations. This condition will not be applicable to taxpayers authorized to use the simplifications referred to in Art. 166 and 182 of the Union Customs Code and entities with the status of authorized economic operators – AEO.


According to the new Art. 33a 2.1, the simplification will be used by all taxpayers registered as VAT taxpayers who submit to the head of the customs and tax office, issued not earlier than 6 months before the import:


a. certificate confirming the lack of arrears in payments of tax and social security
b. confirmation of registration of the taxpayer as an active VAT payer.
 

The payment date of import VAT will also be changed. Before July 2020, the deadline was 10 days from customs clearance or from the date of issuing a customs decision, now general rules will apply i.e. by the 25th day of the following month together with a VAT return.

The introduced provisions assume that taxpayers settling the VAT due on the import of goods directly in the VAT reports will have to file monthly returns.

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VAT refund to taxable persons not established in the European Union

The company is a middleman established in Switzerland and now has a Polish client that ordered goods that were bought from a Polish contractor. The Polish contractor delivered the goods directly to the Polish client. The Polish contractor sent an invoice with Polish VAT and the Middleman (in the Switzerland) sent an invoice to the final client without VAT using reverse charge mechanism.

Questions:

  1. Is it correct that the Polish contractor sent an invoice with Polish VAT ?
  2. If the VAT was invoiced by the Polish contractor correctly how the Polish VAT (refund) can be requested back? How fast would the Polish VAT be refunded by the Polish tax authorities?

Answer:

Regarding the described situation as you mentioned the goods did not leave Poland at any moment – they were delivered between two Polish entities (although the invoicing was between the supplier and your Client). Consequently there was no export or intra-Community delivery (no movement between countries) and the PL supplier had to apply 23% i.e. local VAT rate.  

The VAT can be claimed through the Polish tax administration according to requirements of Polish law. The application should be filed no later than till the 30th September of the year following the tax year to which the application relates. The tax office issues a decision on the amount of the recognized VAT refund amount within 4 months of receipt of the application.

https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:31986L0560&qid=1425222205431&from=EN

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Whitelist VAT Poland – changes from July 1, 2020

The VAT regulations in Poland regarding the obligation to pay into a bank account disclosed on the whitelist will change. The deadline for submitting ZAW-NR form by taxpayers will be extended from three to seven days. Additionally the number of cases in which payment to an account not placed on the list will be allowed will officially increase.

From January 1, 2020 it was not allowed to include certain expenses in the tax costs if they were paid on the bank account other than this disclosed on the whitelist. This concerns expenses incurred for the purchase of goods or services of a value exceeding PLN 15,000.

Before the amendment, the only way to avoid this sanctions was to inform the tax administration about this by submitting the ZAW-NR notification within three days of the bank transfer.

From July 1, 2020, it was decided to extend the taxpayer’s submission of the ZAW-NR form from three to seven days. The tax office to which ZAW-NR should be submitted has also been changed. It will be the tax office competent for them, and not for the seller.

The number of cases in which the sanction of exclusion from costs will not apply at all will increase. From July 1, 2020 the taxpayers will not be required to exclude expenses from the costs if the payment is made to an account not disclosed on the whitelist, but:

• will be made using the split payment mechanism,

• will relate to invoices documenting IC acquisition, import of goods and services and delivery of goods settled by the buyer.

The amendment will apply to expenses included in costs from January 1, 2020 and regulated from that date. This means that taxpayers who from 1st January to 30th June 2020 settled payments using the split payment mechanism can now correct their settlements, if the payment was made to a bank account outside the whitelist.

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Brexit: VAT refund for British and Polish companies

Brexit will affect Polish taxpayer’s ability to claim a refund of British VAT on expenditures incurred within the territory of Great Britain (and so it will affect Polish VAT refunds for British entities). Up until now, based on the EU directive, taxpayers of all the Member States were entitled to claim a refund of the tax charged on purchased products and services within all the European Union using a uniform procedure. The procedure provides that a taxpayer submits an application for a refund of the foreign VAT in an electronic form to his appropriate tax office, which, after the initial verification, passes on the application to the tax administration of a relevant country. Within several months after submitting the request, the taxpayer receives the tax return onto his bank account.

After Great Britain’s leave, the VAT refund procedure for foreign entities remains under previously binding rules. However, it only does until the end of the transitional period. What it means is that the British VAT reclaims will only be possible on expenditures incurred until 31st December 2020. Furthermore, according to the agreement, the VAT refund applications must be submitted until 31st March 2021, which is a significant derogation from the generally binding deadline (usually, the applications are submitted until 30th September of a given year for a previous year). After the transitional period, reclaiming British VAT might not be as simple (if possible at all). First of all, what should be considered is that VAT refunds between the EU Member States and third countries (which Great Britain will become) are generally carried out based on reciprocity, i.e. if a given third country allows for claiming VAT refunds for entities from a particular Member State, then the Member State allows for claiming VAT refunds for taxpayers from the same third country. As can be seen, national authorities’ discretion applies in this case, and there is no general rule for third countries to use the same principle.

What appears likely is that Great Britain will continue to cooperate with the EU in terms of VAT returns and that Polish taxpayers will still be able to reclaim VAT charged on expenditures incurred in GB. It should, however, be assumed, that the procedure might not be as much taxpayer-friendly (current simplicity results from significant harmonisation of regulations within the EU). The general principle is to submit the applications directly to the tax administration of a third country, which implies a necessity of understanding the rules applicable in that country, using local forms and a language. The details depend on the kind of solution Great Britain will decide to adopt. Check our service Tax Advisory http://qqtcdof.cluster026.hosting.ovh.net/europetax/services/tax-advisory/