Poland: Obligatory split payment mechanism and white list of VAT taxpayers introduced

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Poland: Obligatory split payment mechanism and white list of VAT taxpayers introduced

Sponsored by

sponsored-firms-mddp.png
poland.jpg

The Polish Ministry of Finance is amending the VAT Act and some other acts, providing for the introduction of a mandatory split payment model for certain transactions from September 1 2019.

The Polish Ministry of Finance has recently published a bill amending the VAT Act and some other acts, providing for the introduction of a mandatory split payment model for certain transactions from September 1 2019.

The introduction of a mandatory split payment mechanism in Poland results from the derogation decision of the Council of the European Union Poland No. 2019/310. The decision provided that Poland should introduce an obligatory split payment by February 28 2022. Nevertheless, the above required the adoption of Polish legislation.

The bill provides that the mandatory split payment mechanism will apply in particular to supplies of goods and services that are subject to the reverse charge mechanism in Poland, as well as some others, as follows:

  • Steel products and scrap;

  • Construction services;

  • Consumer electronics (computers, telephones, TV sets, etc.);

  • Motor fuels;

  • Coal products; and

  • Automotive parts and accessories.

Payments using the split payment mechanism will apply to invoices documenting transactions made between taxpayers (B2B) with a one-off value exceeding PLN 15,000 ($4,000).

Failure to meet new obligations will result in serious sanctions such as:

i) VAT sanction of 100% of the amount of the tax disclosed on the invoice may be imposed on the invoice issuer just for failure to include, on the invoice, the notice 'split payment mechanism' as well as on the purchaser of goods/services who will not make the payment of VAT from the invoice in the split payment mechanism despite such an obligation;

ii) exclusion of the expense from tax deductible costs in corporate or personal income tax settlements; and/or

iii) a fine from the penal fiscal code of up to PLN 21 million.

Although the bill has set out an effective date of September 1 2019, one cannot exclude the possibility that amendments will be postponed. Legislative works on Polish mandatory split payment regulations have still not been completed and the bill may not be adopted before summer break.

White list

Surely, though, the so-called white list of VAT taxpayers will come into force in Poland by September 1 2019. The white list will have an electronic form and include, among others, bank account numbers of VATpayers.

According to the amendments, payments exceeding value of PLN 15,000 made to bank accounts not included in the list cannot be treated as tax deductible from a personal or corporate income tax perspective and will result in joint liability for VAT obligations of the supplier.

more across site & shared bottom lb ros

More from across our site

The US president also unveiled a new 50% levy on copper imports; in other news, a UK wealth tax proposal has been criticised by the Institute for Fiscal Studies
Wim Wuyts, who had been head of the specialist tax network since 2017, is moving on to a new role with WTS’s Belgian member firm
MNEs are increasingly using algorithmic tools in TP. Sahasranshu Dash argues that data ethics should therefore plug directly into the TP design process
The Institute of Chartered Accountants in England and Wales also queried whether HMRC resources could be better spent scrutinising larger entities
Grant Thornton’s Austria tax head likens his practice to an escape room, shares his football coaching ambitions, and explains why tax is cool
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 EMEA Tax Awards
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2025 Asia-Pacific Tax Awards
The fates of pillars one and two hang in the balance after the US successfully threw its weight around in G7 and Canadian negotiations
Rafael Tena tells ITR about the ‘crazy’ Mexican market, ditching the hourly rate, and refusing to grow his fledgling firm in an ‘unstructured way’
It should be easy for advisers to be transparent about costs, Brown Rudnick partner Matthew Sharp said in response to exclusive ITR in-house data
Gift this article