Invoice of the taxpayer exempt from VAT not always with a legal basis


From 1 January 2014, taxpayers exempt from value added tax may (and in some cases have to) document their sales with invoices, and not previously used for this purpose. Such invoices of the taxpayer exempt from invoices issued by the so-called "VAT" differ primarily in the information about the legal basis of the exemption, which is used by the issuer of the document. However, not all entrepreneurs know that there are some exceptions to this rule.

Tax Code and the invoice of the exempt taxpayer

Already at the beginning of 2013, the regulations introduced the possibility of issuing invoices by taxpayers benefiting from the VAT exemption. Currently, pursuant to Art. 87 par. 1 of the Tax Ordinance, taxpayers conducting business activity are obliged to issue an invoice for the sale or provision of a service, if requested by the buyer or the recipient of the service, and if separate provisions do not imply an obligation to issue an invoice. At this point, attention should be paid to Art. 106b of the VAT Act.

Art. 106b sec. 3:

At the request of the buyer of the goods or services, the taxpayer is obliged to issue an invoice documenting:

1) the activities referred to in para. 1, paragraph 1, with the exception of the activities referred to in article 1. 19a paragraph. 5 point 4, and receipt of all or part of the payment before performing these activities, except in the case when the payment concerns intra-Community delivery of goods - if the obligation to issue an invoice does not result from paragraph 1,

2) sale exempt, referred to in paragraph. 2, subject to article 22. 117 point 1 and article. 118

- if the request for its issue was made within 3 months from the end of the month in which the goods were delivered or the service was performed, or the whole or part of the payment was received.


This means that every taxpayer, also exempt from VAT, is required to document his sale of goods or services with an invoice whenever he receives such a request from the buyer.

The basis for the exemption on the invoice

The provisions of the amended VAT Act, and more specifically Art. 106e specify exactly what should be on the invoice. For exempt taxpayers, point 19 is of particular importance, as it relates directly to the documents issued by them. According to this provision, the entrepreneur, when issuing an invoice, should each time include information on the basis on which he benefits from the VAT exemption. The act mentions several possibilities:

  • due to the scope of performed activities (Article 43 (1)),

  • due to detailed provisions (Article 82 (3)),

  • due to the fact that the limit of the sale value was not exceeded in the previous tax year (Article 113 paragraph 1 and 9).

Only on the basis of the provisions of the VAT Act, it can be concluded that every taxpayer exempt from VAT, regardless of what basis it uses, is obliged to indicate the reason for the exemption. However, in this case, one should also refer to the provisions of the Ordinance of the Minister of Finance of December 3, 2013 on issuing invoices. It has been in force since 1 January 2014 and in par. 3 point 3 indicates which information exactly must be included in the invoice of the taxpayer benefiting from the subjective exemption (based on not exceeding the sales limit). In accordance with the above-mentioned the provision in such a case is necessary to include:

  • date of issue,

  • sequence number,

  • names and surnames or names of the taxpayer and buyer of goods or services and their addresses,

  • name (type) of goods or services,

  • measures and quantity (number) of delivered goods or scope of services performed,

  • unit price of a good or service,

  • total amounts due.

As you can see, among the necessary data, there is no provision for indicating the basis for the exemption. This means that such information does not have to be included in the invoice issued by a taxpayer benefiting from VAT exemption, which has not exceeded the statutory sales value limit. In the case of any other grounds for exemption, information about it must be obligatorily included in the sales document.