Poland: Digitalisation of VAT settlements

April 30 2018

The Ministry of Finance is continuing on its path towards limiting VAT gaps and eliminating VAT fraud through the digitalisation of tax settlement procedures. The process began in July 2016 with the introduction of standard audit files for tax (SAF-T) into Polish tax law. To begin with, only some VATpayers (so-called large-scale entrepreneurs) were obliged to prepare and submit SAF-T filings containing data on VAT sales and purchases. Eighteen months later, from January 1 2018, the obligation to prepare and submit SAF-T filings applied to all active VATpayers (excluding those who perform only VAT-exempted activities). SAF-T filings in Poland have to be submitted monthly, no later than the 25th day of the month following the month to which the file refers. This is also the case for taxpayers who are submitting VAT returns on a quarterly basis.

Alongside the introduction of SAF-T filing, the method of submission of VAT returns has also been changed. In the past, taxpayers were able to submit VAT returns in paper format, or voluntarily in electronic form. Since January 1 2017 some taxpayers have been obliged to submit electronic VAT returns, and from January 1 2018 this obligation was extended to all VATpayers.

It should also be noted that the amendments to the VAT Act, which came into the force on January 1 2018, signalled the end of keeping records in paper form, thus all VAT records must now be kept in electronic format through the use of computer programs.

Also since 2018, tax authorities are equipped with a new tool, called STIR – a teleinformatic clearing house system (some of the regulations in this area came into force in January 2018, the rest will be coming to force in July). It is a system that collects data on a daily basis for fiscal purposes about all payments made by entrepreneurs via bank accounts. The data are analysed automatically by the tax authorities with algorithms known only to them and designed especially for this purpose. This analysis is aimed at catching untypical transactions and uncovering potential fraud. On the basis of such analysis the tax authorities are able to block the bank accounts of suspicious persons or entities for three months. They can also refuse to register suspicious persons or entities as VATpayers.

In the future, the government is planning to replace VAT returns with SAF-T files, which is totally understandable since VAT returns have to be compatible with SAF-T files and the latter contain much more data than a VAT return. There are also plans for changes regarding the use of cash registers, which implies that all cash registers will have to be connected to a central database.