Small taxpayer invoice on the cash basis


The cash method in VAT is a special form of settlement available for the so-called small taxpayers. Which entrepreneurs are small taxpayers and what data should a small taxpayer invoice contain?

A small taxpayer within the meaning of the VAT Act

Pursuant to Art. 2 point 25 of the VAT Act, a small taxpayer is a VAT taxpayer:

  • in which the value of sales (including the tax amount) did not exceed the amount expressed in PLN in the previous tax year, corresponding to the equivalent of EUR 1,200,000. In 2015. the limit that entitles you to use the status of a small taxpayer is PLN 5,015,000.

  • running a brokerage company, managing investment funds, being an agent, commissioner or other person providing services of a similar nature, with the exception of a commission commission - if the amount of commission or other forms of remuneration for the services rendered (including the tax amount) did not exceed in the previous tax year expressed in PLN the amount corresponding to the equivalent of EUR 45,000. Converted into PLN, in 2015 it is the amount of PLN 188,000.

The above amounts expressed in EUR are converted at the average EUR exchange rate announced by the National Bank of Poland on the first business day of October of the previous tax year, rounded up to PLN 1,000. As of October 1, 2014. the course was PLN 4.1792.

Cash method of settlements of small taxpayers

A small taxpayer may settle accounts according to general rules or choose the cash method, consisting in the following:

  • on the day of receipt of all or part of the payment, if goods are supplied or services are provided to a taxpayer registered as an active VAT payer;

  • on the date of receipt of all or part of the payment, but not later than on the 180th day from the date of delivery of the goods or performance of the service, if they relate to an entity other than specified in point 1.

  • if only part of the receivable has been paid - a tax obligation arises which applies only to the part paid.

The head of the tax office should be notified in writing about the use of the cash settlement method by the end of the month preceding the period for which this method will be used.

Small taxpayers who chose the cash-based method submit tax returns for quarterly periods to the tax office by the 25th day of the month following each subsequent quarter. These settlements should be made on the VAT - 7K form.

Small taxpayer invoice

When using the cash method, the small taxpayer's invoice should contain all the basic data specified in Art. 106e, section 1 of the VAT Act. In addition, the invoice should bear the indication "cash method".

Loss of the right to use the cash-based approach by a small taxpayer

The reason for the loss of the right to use this form of settlement is the loss of the status of a small taxpayer. If the taxpayer exceeds the specified turnover limit for a given year, then the taxpayer loses the right to settle the tax with the cash method. In 2015. the amount is PLN 5,015,000

If a taxpayer has lost the status of a small taxpayer, and thus the right to the cash method, he is obliged to inform the tax office about this fact. Such notification is made on the VAT-R form within 7 days from the termination of this right.

After exceeding the limit, the taxpayer should settle accounts on general principles.

Small taxpayer invoice - resignation from the cash method

The taxpayer may also opt out of the cash-based method himself. However, not earlier than after the lapse of 12 months during which he was accountable in this way. It is necessary to inform the tax office about this by the end of the quarter in which the cash method was used. In such a situation, a small taxpayer will make monthly VAT settlements from the month following the quarter in which the notification was submitted.