RSM Poland


Further changes in VAT already in June

Further changes are to be introduced to the Act on Value Added Tax on 1st July 2015, including new provisions on reverse charge, joint and several liability, bad debt relief and the possibility to apply proportional deduction of input tax.

Also the catalogue of goods subject to reverse charge shall be updated by adding new groups of goods, such as laptops, notebooks, tablets, mobile phones, smartphones, as well as video game consoles and other devices with electronic display intended for arcade and gambling games.

The list of sensitive goods will be supplemented with 10 new items the delivery of which is subject to joint and several liability on the purchaser's part for the vendor's arrears in VAT payment.  Changes should also be expected in the retention bond system.

In accordance with the new regulations on bad debt relief, a debtor that has been declared bankrupt or put into liquidation shall not be obliged to correct its input VAT. On the other hand, lawmakers in Poland decided to enable affiliated entities to correct their input tax.

Regarding the subject of proportional deduction of input tax, the new provisions specify that the extent to which an entity is entitled to deduct tax for goods and services used in running its business and for other purposes shall be established by means of proportion corresponding to the type of business run by the taxpayer.

The introduced changes should be considered positive. Although some of the new provisions mean more duties for taxpayers, especially in case of purchasers of sensitive goods, the subject amendment to a great extent addresses demands filed by taxpayers and VAT experts.

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