Practice of tax authorities on the split payment mechanism
Already first tax rulings regarding obligatory split payment mechanism have been issued. In one of such tax rulings (no. 0111-KDIB2-1.4010.509.2019.2.BKD), tax authority confirmed that payment made under the split payment mechanism to a bank account previously verified with the list of information on VAT payers (the so-called White list of VAT payers) taxpayer has the right to recognize the payment as tax deductible costs. For example, if the taxpayer after verification of the contracting party, makes two payments, first – in a net amount in foreign currency to the supplier’s account and the second one to a special VAT account, taxpayer can recognize expenses as tax deductible costs.
Obligation to report certain tax schemes again?
Compliant with the draft of amendment to tax provisions dated February 5, 2020 it will be required to notify cross-border tax schemes again. According to the draft’s justification the re-reporting is determined by the need to adjust the national information package (currently in use) to the standard established by the European Commission. Pursuant to the draft of amendment, the obligation to re-report cross-border tax schemes to the Head of the National Treasury Administration will arise when the first activity related to the implementation of the scheme was carried out between June 26, 2018 and March 31, 2020. The deadlines for re-notification are varied (end of May/ end of July/ end of August) and depend on the type of reporting entity (promoter/ user/supporter). If provisions are implemented in the planned shape, amended MDR legislation will enter into force on April 1, 2020 and any cross-border tax scheme number issued before that date will be invalidated by law.
Planned amendments to the white list and implementation of EU Quick Fixes package
Draft of amendment to tax provisions dated February 5, 2020 foresee that if the payment is made in the split payment mechanism there will be no obligation to verify whether contractors’ bank account is on the white list. Moreover, the deadline for submission ZAW_NR statement (information on payment execution on the account not listed on the white list) will be exceeded from 3 to 7 days. Moreover, project assumes the implementation of the Quick Fixes that is changes in “call of stock procedure, chain transactions as well as premises allowing for application of 0% VAT rate for intra-Community transactions.
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