European Commission authorises extension of split payment mechanism
The European Commission also recently authorised Poland to extend the application of its split payment mechanism until February 28, 2025. By way of background, “split payment” is a payment mechanism under which the payment for the net value of the goods or services is made to the supplier’s basic settlement bank account, and the VAT amount is paid to a dedicated VAT bank account (that is automatically created by the bank).
SLIM VAT 3 proposal
Poland recently held a consultation on its “simple, local, and modern” (SLIM) VAT 3 proposal. This is the third package of changes to Polish VAT rules which are intended to simplify VAT compliance for businesses and tackle abuse and fraud. If adopted, the proposal would increase the annual small taxpayer threshold to from EUR 1.2 million to EUR 2.0 million and introduce new exchange rate rules when invoices are corrected. There are also proposed changes relating to intra-community sales where the supplier does not hold the requisite documents and the de-minimis partial exemption VAT recovery rules.
Contact our international indirect tax experts to discuss Polish VAT compliance obligations and how Avalara can help with VAT registration, VAT returns, fiscal representation, and e-invoicing in Poland.
