Electronic invoices sent in PDF format give the right to deduct input tax

Individual ruling of 12 May 2011, file ref. IPPP3 / 443-468 / 11-2 / JF, Director of the Tax Chamber in Warsaw

Based on Article. 14b § 1 and § 6 of the Tax Ordinance of August 29, 1997 (i.e. Journal of Laws of 2005, No. 8, item 60, as amended) and § 7 of the Regulation of the Minister of Finance of June 20, 2007 in on authorization to issue interpretations of tax law (Journal of Laws of 2007, No. 112, item 770, as amended), the Director of the Tax Chamber in Warsaw, acting on behalf of the Minister of Finance, states that the Applicant's position, presented in the application of 23.03. 2011 (date of receipt on March 25, 2010) for a written interpretation of the tax law regarding value added tax regarding the right to deduct input tax from electronic invoices sent via e-mail in PDF format - is correct.

JUSTIFICATION

On March 25, 2011, the above-mentioned application for a written interpretation of the tax law regarding value added tax in terms of the possibility of deducting input tax from electronic invoices sent via e-mail in PDF format.

The following future event is presented in the present application:

In the course of its activity, the Applicant purchases and sells goods and services. The transactions in question are documented with VAT invoices, issued and sent in paper form via post or courier (or handed over in person).

In order to improve the flow of invoices, the Applicant and its contractors are considering changing the method of sending invoices so far by withdrawing from issuing and sending them in paper form and replacing them with electronic invoices sent via e-mail in PDF format.

The applicant intends to conclude with contractors a written agreement on issuing and sending invoices in electronic form, in which the acceptance of this form of invoicing by the parties will be expressed and procedures will be defined to ensure the authenticity of the origin and integrity of the content of the invoices. In particular, the Applicant intends to establish that the invoices issued and received by him will be sent by e-mail in the form of PDF files from a specific e-mail address, for which the name of the sender is the full name or the abbreviation of the entity issuing the invoice. Sending invoices will be made with both a computer and software secured with a login and password. The software will be operated by an authorized employee who will be able to leave his workplace after logging out and blanking the screen.

The applicant will keep an e-mail with an attachment (a file containing an invoice) in an appropriately named directory for the period until the tax liability expires. The catalog containing e-mails with invoices will be divided into billing periods.

The applicant has received an expert opinion issued by the Faculty of Mathematics and Computer Science of the University of March 8, 2011 (hereinafter: Expertise), confirming that the invoices issued in PDF format and sent by e-mail meet the requirements set out in the Regulation. The expertise is attached to this application.

In light of the above, the following questions were asked:

Do the invoices in PDF format issued and received by the Applicant in the circumstances described in the description of the future event constitute electronic invoices within the meaning of the provisions of the Regulation, in particular, they guarantee the authenticity of the origin and integrity of the invoice content ...

Will the invoices in PDF format received by the Applicant in the circumstances described in the description of the future event entitle the Applicant to reduce the tax due by the input tax resulting from these invoices on the date of receipt of the e-mail with an attached invoice (in the cases referred to in Article 86 section 10 point 1 of the VAT Act) ...

According to the Applicant:

PDF invoices issued and received by the Applicant in the circumstances presented in the description of the future event constitute electronic invoices within the meaning of the provisions of the Regulation, as they guarantee the authenticity of the origin and integrity of the content of the invoice. Invoices in PDF format received by the Applicant in the circumstances described in the description of the future event will entitle the Applicant to reduce the output tax by the input tax resulting from these invoices on the date of receipt of the e-mail with an attached invoice (in the cases referred to in Article 86 (10) point 1 of the VAT Act), assuming that the general conditions for the right to deduct under Art. 86 of the Act of March 11, 2004 on tax on goods and services (Journal of Laws of 2004, No. 54, item 535, as amended, hereinafter: the VAT Act).

Pursuant to § 3 sec. 1 of the Regulation, invoices may be sent, including made available, in electronic form in any electronic format, provided that this method of sending invoices has been previously approved by the recipient of the invoice. Acceptance or its withdrawal may be expressed in writing or in electronic form. Moreover, pursuant to § 4 of the Regulation, invoices may be sent in electronic form, provided that the authenticity of the origin and integrity of the invoice content is ensured.

The above means that the basic condition for the admissibility of electronic invoicing is the consent of the recipient of the invoice to this form of invoicing. In the situation which is the subject of this application, this condition will be met by the Applicant concluding an appropriate written agreement in which the parties accept electronic invoicing.

Another requirement necessary to recognize a document as an electronic invoice within the meaning of the Regulation is to ensure the authenticity of the origin and integrity of the content of the invoice. The definitions of the authenticity of the origin of the invoice and the integrity of the content of the invoice were introduced by § 2 para. 1 of the Regulation. The authenticity of the origin of the invoice means certainty as to the identity of the supplier of goods or service provider or the issuer of the invoice. On the other hand, we refer to the integrity of the content of the invoice when the data that should be included in the invoice has not been changed in the invoice. Therefore, it is crucial to prove and obtain certainty as to the identity of the person delivering the goods (providing the service) and the issuer of the invoice, and the fact that the data contained in the invoice has not been changed. The above wording boils down to ensuring that the invoice was issued by a specific taxpayer and that the content of the document did not change during its transmission to the recipient.

Pursuant to § 2 sec. 2 of the Regulation, the authenticity of the origin and integrity of the content of the invoice are preserved, in particular when using:

a secure electronic signature within the meaning of Art. 3 point 2 of the Act of 18 September 2001 on electronic signature (Journal of Laws No. 130, item 1450, as amended), verified with a valid qualified certificate or electronic data exchange (EDI) in accordance with the contract on the European model for the exchange of electronic data, if the concluded contract relating to this exchange provides for the application of procedures guaranteeing the authenticity of the origin of the invoice and the integrity of its data. Therefore, the regulation provides examples of methods of ensuring the authenticity of the origin and integrity of the content of the invoice, i.e. the use of a secure electronic signature or electronic data interchange (EDI). However, this is an open catalog of methods, which is confirmed by the use of the expression in this provision in particular. Therefore, taxpayers may use any methods of sending electronic invoices as long as they guarantee the fulfillment of the conditions of authenticity and integrity referred to in para. 1 of the said provision.

In the opinion of the Applicant, invoices issued in PDF format and sent by e-mail in the circumstances described in the description of the future event will meet the requirements set out in the Regulation, because, as well as paper invoices, they allow to identify the origin of the invoice and prevent the change of data that should be included in the invoice.

The regulation does not specify whether the authenticity of the origin and integrity of the content should be ensured by using IT solutions or properly documented procedural solutions. It does not require the use of mathematical solutions, in particular cryptographic and IT solutions - the purchase of appropriate devices, software or properly described business solutions (e.g. procedures described in the contract). In the Applicant's opinion, supported by an Expertise, sufficient for the fulfillment of the condition of the authenticity of the origin and integrity of the content when invoicing in PDF format is the development in writing and implementation of procedures that guarantee compliance with the principles described below:

sending invoices secured with login and password of both computer and software;

the software is operated by an authorized employee who may leave his workplace after logging out and blanking the screen;

sending invoices from a specific e-mail address for which the sender's name is the full name or abbreviation of the entity issuing the invoice.

Referring to the content of the Expertise, an entrepreneur who has appropriate written procedures that include protection against access to a computer and software at the login and password level, the use of which he will be able to document for the inspection of the Tax Office, meets the conditions for authenticity and integrity when sending electronic invoices by e-mail. in PDF format.

It is true that with the use of specialist knowledge it is possible to impersonate the sender of the message and to edit its content in such a way that it gives the impression of coming from the sender. There are also graphic processing programs that allow you to change the content of the invoice. However, it should be borne in mind that this is a criminal act, and a similar operation of forging a document may be performed in relation to a paper invoice.

At this point, the Applicant would like to draw attention to the main purpose of the provisions of the Regulation introduced from 1 January 2011, which is equal treatment (in particular by tax authorities) of paper and electronic invoices. In the justification to the draft Regulation, the Minister of Finance indicated that the purpose of the proposed changes is to simplify the trading of these invoices so that electronic invoices become a real alternative to paper invoices.

In addition, in the justification of the draft amendments to the regulation of November 28, 2008 on tax refunds to certain taxpayers, issuing invoices, their storage and goods and services to which the VAT exemption does not apply (Journal of Laws of 2008, No. 212, item 1337), which have been in force since January 1, 2011, the Minister of Finance presented that the Proposed changes, along with changes in executive regulations, concerning the method of sending invoices in electronic form, the rules for their storage and the procedure for making them available to the tax authority or The main aim of the fiscal control authority is to popularize electronic invoicing, to standardize the treatment of paper and electronic invoices, and to enable the storage of paper invoices in electronic or electronic form in paper form, which should contribute to facilitating the documentation of economic transactions.

In addition, in the brochure The most important changes in VAT from 1 January 2011, published on the website of the Ministry of Finance, the Minister of Finance emphasized that this simplification consists in particular in enabling the issuing and sending of electronic invoices in any electronic format (PDF, doc. on the exhibitor's server, as well as e.g. sent by e-mail).

It should also be remembered that the Regulation adjusts Polish regulations to the requirements of the amended Council Directive 2010/45 / EU of July 13, 2010, which aims, inter alia, at to liberalizing the applicable rules for sending and storing electronic invoices and bringing about the same treatment of paper and electronic invoices.

Therefore, the Applicant may adopt a solution that provides the same degree of certainty as to the authenticity and integrity of the content as for paper invoices sent by traditional mail. Therefore, no other conditions can be imposed to ensure the authenticity of origin and integrity of the content for electronic and paper invoices. According to experts, a paper invoice is not required to be secured in such a way as to prevent any crime against the documents. Due to the fact that for paper invoices sent by classic mail it is not required to prevent the falsification of data on the invoice, it cannot be required for invoices sent by electronic means. According to the conclusions of the Expertise, invoices issued in PDF format and sent by e-mail, to the same extent as paper invoices, sent by classic mail, prevent the change of the data that should be included in the invoice, in particular the data on VAT and the authenticity of origin. that the currently available software equally enables the unlawful generation of an invoice containing the changed essential data, whether in paper or electronic form.

It should also be borne in mind that pursuant to Art. 274c of the Tax Ordinance, the tax authorities are entitled to require the taxpayer's contractors to present documents within the scope of the taxpayer's control, in order to verify their correctness and reliability. Therefore, tax authorities have the possibility to verify the correct issuance and sending of electronic invoices in PDF format by comparing the invoices received by the buyer with the invoices issued by the seller, thus checking the authenticity of their origin and confirming the integrity of the content.

Moreover, if the method of storing invoices in electronic form allows for quick association of the invoice with the order, contract or delivery note, it may be an additional means of verifying the authenticity of the origin of the invoice. Thus, if for an electronic invoice sent by e-mail, in a format that does not allow for its modification, such as PDF, it is possible to compare it (e.g. by referring to the content of the e-mail or attached invoice to the order, contract or WZ document with documents, on the basis of which it was issued, this will constitute the basis for additional ensuring the authenticity of the origin and integrity of the content of the invoice.

The applicant would like to emphasize that the invoices issued and received by him will be stored in accordance with the requirements set out in § 6 of the Regulation. In particular, the Applicant will store e-mail records together with attachments (files containing invoices) in a directory divided into settlement periods, while maintaining the above-described procedures protecting against changing the content of the invoice, and thus ensuring the integrity of the content and legibility of invoices. According to the Expertise, the entry of the e-mail with the invoice ensures the authenticity of origin because the date of sending, the sender's e-mail address, and the sender's name are recorded together with the content of the e-mail, which can be compared with the data on the invoice. Invoices will be stored for the period from their issue until the expiry of the limitation period, in a manner ensuring their easy retrieval and immediate access to invoices by the tax authority or the tax inspection authority.

To sum up. The applicant intends to implement, in cooperation with contractors, the procedures described above to ensure the authenticity of the origin and integrity of the content of invoices in PDF sent via e-mail, i.e .:

conclude with contractors a written agreement on issuing and sending invoices in electronic form, in which the acceptance of this form of invoicing by the parties will be expressed and procedures will be defined to guarantee the authenticity of the origin and integrity of invoices; determine that the invoices issued and received by the Applicant will be sent by e-mail in the form of PDF files from the specified e-mail address, for which the name of the sender will be the full name or abbreviation of the entity issuing the invoice; ensure that invoices are sent with both the computer and software secured with a login and password, and that the software will be operated by an authorized employee who will be able to leave his workplace after logging out and blanking the screen.

In the opinion of the Applicant, this means that the invoices issued and received by the Applicant will meet the requirements provided for in the provisions of the Regulation and will constitute electronic invoices within the meaning of these provisions.

Consequently, it should be assumed that the Applicant, by issuing invoices in the circumstances described in the description of the future event, will fulfill the documentation obligation specified in Art. 106 sec. 1 of the VAT Act.

At the same time, the Applicant will have the right to deduct the input tax resulting from PDF invoices received via e-mail on the date of receipt of the e-mail with an attached invoice (in the cases referred to in Article 86 (10) (1) of the VAT Act), with the assumption that the general conditions giving the right to deduct VAT, referred to in art. 86 of the VAT Act.

In the light of the applicable legal status, the position of the Applicant regarding the legal assessment of the presented future event is considered correct.

Bearing in mind the above, pursuant to Art. 14c § 1 of the Tax Ordinance, the legal justification for the assessment of the Applicant's position was abandoned.

The local authority also informs that the issued interpretation - pursuant to Art. 14b § 1 of the Tax Ordinance applies only to the issue and receipt of invoices by the Applicant who is the Interested Party. Therefore, the counterparty cannot derive legal effects from this interpretation.

The interpretation concerns the future event presented by the Applicant and the legal status in force on the date of issuing the interpretation.

The party has the right to lodge a complaint against this interpretation of tax law due to its inconsistency with the law. The complaint is to be lodged with the Provincial Administrative Court in Warsaw, ul. Jasna 2/4, 00-013 Warsaw, after a prior written request from the authority which issued the interpretation within 14 days from the date on which the complainant learned or could learn about its issuance until the violation of the law was remedied (Article 52 § 3 of the Act on on August 30, 2002, Law on proceedings before administrative courts, Journal of Laws No. 153, item 1270, as amended). A complaint to the Provincial Administrative Court shall be lodged (in two copies of Art. 47 of the above-mentioned Act) within thirty days from the date of delivery of the authority's response to the summons to remedy the infringement of law, and if the authority did not respond to the summons, within sixty days from the date of filing the summons. (art. 53 § 2 of the above-mentioned act).

The complaint is lodged through the body whose action or inaction is the subject of the complaint (Article 54 § 1 of the above-mentioned Act) to the following address: Tax Chamber in Warsaw, National Tax Information Office in Płock, ul. 1 Maja 10, 09-402 Płock.