The 10 most important changes to VAT since 2014
1. Rules for issuing invoices
The provisions of the Regulation of the Minister of Finance of March 28, 2011, in force so far, incl. on the issue of invoices and the method of their storage shall expire, and from January 1, 2014, the rules for issuing invoices will be determined by the VAT Act, and more precisely the articles of the amended Act from 106 to 108.
See what risks in invoicing in 2014 related to the change in regulations await you
2. Definition of an invoice
The definition of an invoice, which has never existed before, will be introduced to the VAT Act from January 1, 2014. As a result, each document containing data specified in the act may be considered an invoice with full consequences. On the other hand, the lack of even one of the obligatory elements of the invoice will mean that such a document will not be considered an invoice - it will not give the buyer the right to deduct VAT.
Learn about the definition of an invoice from January 2014
3. Time limits for issuing invoices
According to the general tasks, in 2014 the invoice is issued:
a) no later than on the 15th day of the month following the month in which the goods were delivered or the service was performed;
b) not earlier than 30 days before:
- delivery of goods or performance of a service;
- receipt, prior to the delivery of goods or services, of all or part of the payment (also applies to advance invoices).
Check when to issue invoices in 2014
4. Determination of the tax base
The tax base has been changed - it will not be the turnover itself (net sales) and everything that is the payment that the supplier of goods or the service provider has received or is to receive from the buyer, recipient or a third party, including received subsidies, subsidies and other subsidies by of a similar nature having a direct impact on the price of goods or services provided by the taxpayer.
5. The moment when the tax obligation arises
The tax obligation will no longer be related to the invoice issuance date as before (with some exceptions), and will arise when the goods are delivered or the service is provided. The rules are described in detail in Art. 19a of the amended VAT Act, which shall enter into force on 1 January 2014.
6. Tax obligation for mail order sales
If the payment is made later than the shipment of the goods, the tax obligation arises at the moment of:
- delivery - delivery of goods to the customer;
- receipt of payment;
whichever occurs first.
7. The right to deduct VAT on purchases made
As before, the right to deduct VAT will arise upon receipt of the invoice, and upon the arising of the tax obligation with the seller of goods or services. However, the basis for the right to deduct is still, inter alia, there will be an invoice. The deadline for VAT deduction will also be shortened (2014: if the taxpayer has not reduced the amount of tax due on the date on which the tax obligation arose in relation to the goods and services purchased or imported by the taxpayer, he may do so in two consecutive accounting periods - two periods do not count therefore from the receipt of the invoice and from the moment when the tax obligation arises). So you should check two dates instead of one:
- the moment when the tax obligation with the seller arises;
- date of receipt of the invoice.
8. End of release for second-hand goods
The definition of second-hand goods disappears from the VAT Act. It will no longer be possible to take advantage of the exemption when selling used goods. When selling equipment or fixed assets - even those for which VAT was not deducted, the taxpayer will be obliged to charge VAT on sales.
Learn in detail about the new rules for the sale of fixed assets and equipment in 2014
9. Correcting invoices - confirmation of receipt
From January 1, 2014, an obligatory element of the correcting invoice will be the indication of the reason for the correction. In addition, the possibility of reducing the tax base of the seller will not always require a confirmation from the buyer about the receipt of the correction (response to the judgment of the Court of Justice of the European Union, ref. C-588/10).
10. Partially performed services
The tax obligation arises upon the performance of the service, and with regard to the partially accepted services, the service is also deemed to have been performed in the case of the performance of a part of the service for which the payment has been determined. It may therefore turn out that the tax obligation arises earlier than the moment the service is fully performed.
