Invoice without VAT in Poland: Key information on invoices: A guide
Invoice without VAT in Poland
A sales document without VAT contains essentially the same information as its counterpart with VAT. However, you won’t find on it information about the tax rate, net value or the amount of input tax on the net sales total. The issuance of such a document is possible if you are a VAT-exempt person, both for subject and object reasons. In certain situations, also being an active VAT taxpayer, you have the opportunity to issue such a document. To delve deeper into what circumstances you are entitled to issue a document without VAT and how to do so legally, it is worth familiarizing yourself with this text.
What is a document without VAT in Poland?
Such a document is a certificate of a business transaction that authenticates a specific economic event. A sales document that does not contain VAT is characterized by the absence of charging and collecting VAT on the value of the transaction. When you issue such a document, for example, for the services you offer, the net amount is also the gross amount, which eliminates you from the obligation to collect and remit VAT to the relevant tax units.
The possibility to issue a document without VAT in Poland is available in the context of:
-subjective exemption (up to a turnover threshold of PLN 200,000),
-subjective exemption (due to the type of business),
-activities not subject to VAT (such as export of services or intra-Community supply of services).
When is it possible?
Subjective exemption can be applied when you meet certain statutory criteria:
-Your income (sales value) did not exceed PLN 200,000 last year. If you start your business during the year, you are also entitled to entity exemption, provided you do not exceed the turnover thresholds.
-Your activity does not include the sale of goods or services that are excluded from the entity exemption, i.e. the sale of excise products, precious metals or automobile components, among others.
Obligation to issue a document without VAT in Poland
The need to issue a document without VAT arises in situations where you provide services or offer goods as defined in Article 43(1) of the VAT Act. An invoice without VAT is also mandatory in the context of, for example, exporting services.
When it comes to the content of the invoice, the basic elements remain the same as the VAT-inclusive invoice, but of course with the exception of the VAT rate and amount.
It is worth noting that the invoicing process will change with the introduction of the National e-Invoice System (KSeF). Although for the moment the use of KSeF is optional, this is expected to change for active VAT taxpayers from July 2024, and from January 2025 the system is expected to cover VAT-exempt taxpayers as well.
In summary, the issue of invoicing without VAT in Poland is more complicated than it may have seemed at first glance. While the end result – no VAT – is the same, different types of exemptions are governed by different regulations and have different consequences. It’s worth considering using specialists to focus on growing your business instead of the bureaucratic complexities.