VAT in Poland

The Polish VAT Act is based on EU legislation, and in particular, on the provisions of Directive 2006/112/EC on the common system of value added tax in Europe.
Main VAT rates applicable in Poland in 2013 are as follows:

  • standard rate – 23%
  • reduced rate – 8%
  • super-reduced rate – 5%

Reduced rate is applied to supplies of certain food items, medical products, hospitality services and community housing.
Super-reduced rate is applied to supplies of certain food items, such as bread, dairy products, meats, and selected publications.

VAT in international trade – supply of goods from Poland to the European Union

Taxpayers selling goods to buyers in EU states may apply the 0% VAT rate as part of the intra-Community acquisitions of goods.

VAT in international trade – supply of goods from Poland outside of the European Union

The 0% VAT rate also applies to exports from Poland outside of the European Union. In order for the 0% rate to be applied, the taxpayer must have appropriate customs forms stating that the goods have exited the territory of the European Union.

VAT in international trade – supply of goods from an EU Member state to Poland

Purchasing goods in an EU Member State and transferring it to Poland, the Polish taxpayer must ensure self-assessment of VAT. This means that the taxpayer should disclose both the output VAT resulting from the taxable activity and the input VAT (due to the fact that this activity constitutes a “purchase” for the purpose of its business). Consequently, as a rule, intra-Community acquisitions of goods is a VAT-neutral activity for the Polish taxpayer (the amount of output VAT equals the amount of input VAT).

VAT in international trade – supply of goods from outside the EU to Poland

Imports of goods subject to VAT in Poland are deemed to mean imports of goods from outside the European Union into Poland. In such cases, the import output VAT is typically paid to the customs office that clears the imported goods. Furthermore, a taxpayer that has paid VAT to the customs office may deduct this tax on the basis of the customs document received. In selected cases, it is possible to avoid paying VAT to the customs office and settle the import of goods in a VAT return (postponed accounting system) on the terms applicable to intra-Community acquisitions of goods. However, the implementation of this solution applies solely to entities using the simplified customs procedure. The VAT exemption applies, among other things, to imports of goods subject to inward processing, goods subject to temporary clearance with full customs duty exemption, advertising materials, and product samples.

VAT in international trade – provision of services

In case of cross-border services, a VAT obligation in Poland may arise if the place of taxation of a transaction is Poland.

In this respect, the Polish VAT Act complies with the VAT Directive – for services provided between taxpayers (on a B2B basis) with their registered offices in different countries, the primary place of taxation is the country of the registered office of the entity purchasing the service.

Office in this meaning can be a place of residence or permanent place of business.

In case of services provided by a taxpayer to a non-taxpayer entity (B2C) VAT is due from the service provider.

As a result, under the fundamental principle, VAT will be payable in Poland on service transactions between taxpayers from different countries only if the service recipient has its registered office in Poland. However, in the case of services provided by a Polish taxpayer to a non-taxpayer entity, VAT will be payable in Poland if the service provider has its registered office in Poland.

There are several exceptions to the above rules – for instance, the place of taxation of real property-related services is, in each case, the place (country) in which the real property is located, while the place of taxation of hospitality services is the place (country) of their actual provision.

Based on material prepared by the Polish Information and Foreign Investment Agency.

How much costs accounting in Poland?

After you setup your business in Poland next thing you would be interesting is accounting.There are several options to establish obligatory accounting for your limited company:

  1. Hire an accountant – this may cost you 4500 PLN a month (average salary of an accountant)  plus the cost of insurance, a computer, etc.
  2. Outsource the service to a specialized office.

I will focus on outsourcing the accounting service, which may be a preferable option in the beginning.

There are around 38 000 accounting offices in Poland: from a small “one man show” to big, specialized accounting offices offering the whole service. According to Polish rules (2013) accountants should be registered to be able to offer such service. Some of them offer bookkeeping for foreign investors with accountants speaking foreign languages.

Prices usually depend on number of documents to be booked during a month. The price for a limited company with less than 50 documents a month may start from 500 PLN. This may raise up to 1000 PLN a month with 200 documents. With 1000 documents you can negotiate at a level of 5000 PLN. Remember: a documents usually counts for 2. For instance an invoice plus a payment.

Why accounting online?

When you decide doing your accounting online with help of the accounting service described above, you have several advantages:

  • don’t need to pay for booking invoices – just submit them from the accounting online program directly,
  • limited prices for bank reconciliation – with banking online you can download the bank statement to a file and import to the accounting program,
  • don’t need to bring documents to the office – just scan them and send online,
  • you have access to your data with English menu,
  • you can change the accountant without changing the software – swap from one office to another trouble-free.

We, as mKsiegowa.pl, offer you just the accounting online software and a group of partner accountants. The price for the software will be included in the accounting service, but you can negotiate the price with several accounting offices.

Feel free to contact us for more information.

Doing business in Poland

Doing business in Poland is not easy. World bank ranks Poland at 45 score: http://www.doingbusiness.org/data/exploreeconomies/poland

Accounting is one of challenges. We have 2 regulations:

– single entry booking for small companies with income less than 1.2MM EURO

– double entry booking for limited companies or other companies with income greater than 1.2MM EURO

We can help you when you decide to setup a limited company here. Accounting online system never was easier.

You get access to most common functionalities:

  • Stock management
  • Invoicing
  • Manufacturing
  • General ledger

Such functionalities are useful for trading and services. You can have all matters on hand. Control the stock and automatically book all economic events.

Also the program will take care about your VAT. Value added tax was introduced in Poland in 1993. The VAT system is in line with the European Union regulations. The program will calculate the tax with compliance with sophisticated rules.

Everything available for a reasonable price in Software-as-a-service model. Go to mksiegowa.pl/www/en.

Online accounting software in Poland

More and more people are investing in Poland. This country is very attractive for investors last 20 years. Accounting in Poland is not easy. The purpose of this blog is to help foreign investors doing low cost accounting for their limited companies.

We also offer an online accounting software that complies to Polish accounting rules: mksiegowa.pl/www/en.

Visit our blog an you’ll find useful updates about recent changes in our system.

We will help you to setup your new company and start accounting in 2 ways:

  • on your own – using easy and robust accounting software online
  • with help of a partner bookkeeping service with English speaking accountants

We will offer you free webinars in English to help.

You’re welcome here!

mKsiegowa.pl Team