Poland introduced January 1st 2021 so called SLIM VAT solution (simple, local and modern VAT) which aims to modernize VAT settlements and simplify running the business in Poland.
The main changes in the SLIM VAT Act:
- simplification for invoice corrections (credit/debit notes)
- simplification for exporters
- consistent exchange rates
- benefits for VAT deduction
- extending the deadline for deducting VAT charged on monthly basis
- small value gifts increased to PLN 20
Invoice corrections
SLIM VAT will allow the seller to reduce the tax base already at the time of issuing the correcting invoice in minus (credit note), providing that he has a documentation confirming that he has agreed the terms of the transaction with his contractor. If the taxpayer does not have documentation in the period when a correcting invoice was invoiced, he will reduce the tax base for the accounting period when he obtains this documentation. For the credit note, the actual arrangements between contractors are more significant than issuing of the document.
Regarding the correcting invoices in plus (debit note), the moment of their recognition has been regulated in the rules. In accordance with the SLIM VAT assumptions, the moment of recognizing the correction invoice “in plus” will depend on the reason for its issue.
Extended time limit for the export of goods for exporters
The new regulations extend the date of export of goods from two months that have been in force, until six months. SLIM VAT is intended to make it easier for exporters and to limit the correction of their declarations.
Consistent exchange rates
SLIM VAT is giving a possibility to unify the exchange rates. Taxpayers will have a possibility to choose the rules for converting the tax base in a foreign currency into PLN. They may apply to VAT the same rules as for income tax conversion. This change will simplify the billing. There will also be a possibility to continue to apply the rules defined in the Value Added Tax Act.
Possibility to deduct VAT on accommodation services purchased for resale
The SLIM VAT gives the possibility to deduct VAT on accommodation services, provided that the purchase of the accommodation service is for resale. Previously, taxpayers could not benefit from the VAT deduction.
Extension of the period for deduction of input VAT on ongoing basis
The taxpayers who pay taxes monthly, will be able to deduct the VAT in a total of four months without the need to correct the declaration. This will reduce the number of corrections resulting only from the expiry of the period in which the taxpayer was entitled to deduct VAT from invoices. For quarterly taxpayers, the rules have not changed.
Increase the limit on low value gifts
So far, the taxpayer giving gifts above PLN 10 was obliged to keep records for the identification of the persons to whom he provided gifts. The records did not have to be kept for gifts worth up to PLN 10. SLIM VAT increases the small gifts value from PLN 10 to PLN 20. This reflects the economic changes and the need to adjust the amount of low value gifts to the average in the EU.
