PolandManual

Value Added Tax in local language is “Podatek od towarów i usług”

Reverse charge in Poland

Polish reverse charge for non-established companies

We refer to domestic reverse charge for non-established companies when we speak about supplies of goods made by a foreign non-established company that are located in Poland at the moment of the sale. We also refer to this reverse charge in case of a supply of services made by a foreign business when such supply is in the Poland according to special place of supply rules (e.g. services related to immoveable property, catering, or others).  

  • Services

    • Supplier requirements
      Not established in Poland (irrelevant if the supplier is registered for VAT or not)
    • Customer requirements
      Established and VAT registered in Poland
    • Scope
      Supplies of services located in Poland according to exceptional place of supply (i.e. exceptions to the B2B rule).
  • Goods

    • Supplier requirements
      Not established and not VAT registered in Poland
    • Customer requirements
      Established and VAT registered in Poland
    • Scope
      Supplies of goods made in Poland

Please check this link to refer directly to the Polish VAT Act explaining the different scenarios on Polish reverse charge.

Polish reverse charge on B2B services

Polish businesses receiving services from a non-Polish supplier will normally account for VAT under the reverse charge mechanism.  This reverse charge refers to services falling under the so called “general B2B rule” under EU law. 

As long as a) the place of supply is Poland, b) the supplier is established outside Poland, c) the client is established in Poland, the company is VAT registered and the supply is not exempt, reverse charge will apply on these purchases of services. 

There are however a number of exception scenarios in which the place of supply will not be Poland, even if a non-Polish supplier is supplying services to a Polish business client. We refer to these scenarios as exceptions to the general B2B rule, and they include:

  • services connected with immovable property
  • cultural, artistic, sporting, scientific, educational, entertainment or similar services
  • catering services and services of restaurants
  • short-term leasing of vehicle
  • transport of passengers
  • tourism-related services as specified in article 119 of the Polish VAT Act.

Please check this link to refer directly to the Polish VAT Act.

Reverse charge on specific goods

The domestic reverse charge has been replaced in Poland by the mandatory split payment mechanism (SPM). Domestic reverse charge usually applies to certain goods and services that are likely to be used for carousel fraud purposes. SPM is compulsory for sales or purchases of a specific group of goods listed in Annex 15 to the Polish VAT Act, i.e. the goods and services that were covered by the domestic reverse charge mechanism and those that refer to joint and several liability of the buyer (a supply of construction services, plastic waste, smartphones and steel products). See the split payment mechanism section for more detail.

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