Correction of an electronic invoice

INDIVIDUAL INTERPRETATION of February 19, 2008, file ref. 1401 / PH-I / 4407 / 14-58 / 07 / AŁ / PV-I, Tax Chamber in Warsaw

A taxpayer who has issued an incorrect electronic invoice shall correct it by issuing a correcting invoice and sending it in electronic or paper form, when formal or technical obstacles make it impossible to issue and send such a document in electronic form.

Based on Article. 233 § 1 point 1 in connection with Art. 14a § 4 of the Act of August 29, 1997 - Tax Ordinance (Journal of Laws of 2005, No. 8, item 60, as amended) and in connection with Art. 4 sec. 2 and art. 7 of the Act of November 16, 2006 Amending the Act - Tax Ordinance and Amending Certain Other Acts (Journal of Laws No. 217, item 1590), after considering the complaint of September 3, 2007, supplemented by letters of 10 September 2007 and October 1, 2007, brought by XXX, represented XXX, on the decision of the Head of the First Masovian Tax Office in Warsaw of August 23, 2007, ref. no .: 1471 / VTR2 / 443-33c / 07 / MŻ issued in In the matter of granting a written interpretation as to the scope and manner of application of tax law, the Director of the Tax Chamber in Warsaw decides to refuse to amend the decision of the first instance authority.

JUSTIFICATION

With the application of May 18, 2007, the party requested a written interpretation as to the scope and manner of application of tax law, within the scope of Art. 88 sec. 3a, point 3 and art. 108 of the Value Added Tax Act and the provisions of § 9 para. 1, § 16 sec. 1 and § 17 section 1 of the Regulation of the Minister of Finance on tax refund to certain taxpayers, advance tax refund, issuing invoices, the method of their storage and the list of goods and services to which the VAT exemption does not apply, as well as the provision of § 4 point 2 of the Regulation of the Minister of Finance on issuing and sending invoices in electronic form, as well as storing and sharing these invoices with the tax authority or the tax inspection authority.

Presenting the facts of the case, the Party indicated that it issues and sends invoices in electronic form to its recipients. The Party and its contractor, when exchanging e-invoices, use the Electronic Data Interchange system ("EDI"). Additionally, the Party concluded an "Agreement on cooperation in the field of EDI" with the contractor. In practice, the Company sends the counterparty one e-message containing:

• mandatory elements of VAT invoices (constituting an e-invoice) referred to in § 9 para. 1 of the invoice regulation, and
• other additional information, e.g. order number (which is the basis for the delivery of a specific batch of goods), number of the contractor's sales hall to which the goods were delivered, etc.

On the basis of the concluded agreements, the Party considers that the moment of issuing a given e-invoice is the moment when the e-invoice finally leaves the Company's computer system. On the other hand, the moment of receipt of a given e-invoice is considered by the contractor the moment when the e-invoice is entered in the contractor's system.

However, the way the system works does not allow the counterparty to post an e-invoice that was sent in the form of an e-message containing an error or discrepancy. Periodically, the website receives "summary report" containing a list of e-invoices sent by the Company, which were not accepted by the contractor due to inconsistencies. In the event of inconsistencies in the data referred to in § 9 sec. 1 of the invoice regulation, the Company issues a correcting invoice in paper form. However, when the inconsistencies relate to other information not listed in § 9 sec. 1 of the invoice regulation, the Party shall complete or correct the given additional information and resend the entire e-message. The corrected e-message may be sent to the counterparty in paper or electronic form. The system used by the Company does not allow for the separate sending of only those elements of the e-message, which are only additional information, without sending other data of the e-invoice.

Therefore, the Company requested confirmation that:

1. In the given facts, the obligatory elements of the invoice (e-invoice) do not change, i.e. the data that the invoice should contain pursuant to Art. 106 sec. 1 of the VAT Act and the provision of § 9 sec. 1 of the Invoice Regulation
2. the change of only the additional elements of the invoice (e-invoice) in the given facts does not constitute a breach of the integrity of the e-invoice data in accordance with § 4 point 2 of the e-invoice regulation
3. the change of only the additional elements of the invoice (e-invoice) in the given facts does not impose on the Company the obligation to issue a correcting invoice in accordance with § 17 section 1 of the invoice regulation
4. the re-sent e-message with corrected additional commercial data does not constitute the issue of another VAT invoice documenting a given delivery of goods, and as a consequence, in this situation, there is no issue of more than one invoice documenting the same sale, which means that the regulations do not apply in this case art. 108 and art. 88 sec. 3a point 3 of the VAT Act

As regards question no. 4, the Company expressed the view that changing additional information that does not constitute mandatory elements of a VAT invoice, and then resending such a document to the contractor should not be treated as sending a second invoice documenting the same delivery of goods. In the opinion of the Party, there is no issue of another e-invoice documenting this delivery of goods. Therefore, the provisions of Art. 88 sec. 3a, point 3 and art. 108 of the VAT Act.

In the decision of 23 August 2007, No. 1471 / VTR2 / 443-33c / 07 / MŻ, the Head of the First Masovian Tax Office in Warsaw commented on the question marked No. 4 and considered the position of the Party presented in the application to be incorrect. In the opinion of the authority of the first instance, if during the issuance of the e-invoice there were errors in the additional information provided in the e-messages, the Party should issue a corrective note in an electronic form. After the contractor receives the original e-message with incorrect data, the sent e-message with changes in additional information will be another invoice documenting the same sale, and the Party will be obliged to pay the tax amount resulting from the invoice in question.

The party lodged a complaint against the above decision of September 3, 2007, in which it alleges a breach of:

• § 4 point 2 of the Regulation of the Minister of Finance of July 14, 2005 on the insertion and transmission of invoices in electronic form, as well as storing and sharing these invoices with the tax authority or the tax inspection authority in connection with Art. 106 sec. 1 of the Act of March 11, 2004 on tax on goods and services and in connection with § 9 par. 1 of the Regulation of the Minister of Finance of May 25, 2005 on tax refunds to certain taxpayers, advance tax refunds, issuing invoices, their storage and the list of goods and services to which VAT exemptions do not apply
• art. 88 sec. 3a, point 3 and art. 108 sec. 1 of the act on tax on goods and services
• § 18 of the regulation on invoicing in connection with Art. 106 sec. 10 of the Value Added Tax Act
• art. 14a § 3 in connection with Art. 14a § 1 of the Tax Code and art. 210 § 4 in connection with Art. 14a § 4, art. 217 § 2 and article. 219 of the Tax Code, as well as in connection with Art. 4 sec. 1 and sec. 2 of the Act of November 16, 2006 Amending the Act - Tax Ordinance and Amending Certain Other Acts

In the opinion of the Party, the integrity conditions apply only to the e-invoice itself, and these provisions do not refer to any information accompanying the invoice.

In the opinion of the Party, the change of additional commercial information which are not mandatory elements of the VAT invoice, and then resending such a document to the contractor should not be treated as issuing a second invoice documenting the same delivery of goods.

The party also disagrees with the position of the first instance authority that, as a supplier, it should issue a corrective note.

In the opinion of the Party, the written interpretation should include the legal assessment of the questioning party's position, explanation of the legal basis, while the tax authority limited itself to a partial legal assessment of the Company's position and limited itself to considering and presenting only a part of the legal basis for the decision.

In addition to the above-mentioned complaint, in the letter of September 10, 2007, the party provided the power of attorney in the case granted to XXX, which at the same time was authorized to receive the correspondence.

By another supplementary letter of October 1, 2007, the party sent a photocopy of a written interpretation issued by another tax authority regarding the emergence of a tax obligation, in the case of re-sending the electronic invoice message.

The director of the Tax Chamber in Warsaw, after reviewing the entire material collected in the case, having regard to the facts of the case presented in the application and the applicable tax law provisions, states as follows:

The general rule resulting from Art. 106 sec. 1 of the Act of March 11, 2004 on tax on goods and services (Journal of Laws No. 54, item 535, as amended) - hereinafter the VAT Act, it is that invoices are issued by taxpayers referred to in art. 15, documenting the activity performed as indicated in the structure of the provision. The above-mentioned act does not introduce any further regulations in this respect, but gives the minister competent for public finance the possibility to define detailed rules for inserting invoices, the data they should contain, as well as the manner and period of their storage (Article 106 (8) (1) of the Act on VAT). The legislator also left the discretion of the minister responsible for public finances, in consultation with the minister responsible for computerization, to define, by way of an ordinance, the method and conditions for issuing and sending invoices in electronic form, as well as the rules of storage and disclosure to the tax authority or the tax inspection authority. invoices sent electronically (Article 106 (10) and (11) of the VAT Act).

Using the statutory delegation referred to in Art. 106 sec. 8 point 1 of the VAT Act, on May 25, 2005, the Minister of Finance issued a regulation on tax refunds to certain taxpayers, advance tax refunds, invoicing, how to store them and the list of goods and services for which the tax exemption does not apply goods and services (Journal of Laws No. 95, item 798, as amended), acting in § 8 sec. 1 of this regulation that registered taxpayers as active VAT payers, having a tax identification number, issue invoices marked with the word "VAT INVOICE".

In § 9 sec. 1 above of the regulation, the Minister of Finance specified at least what elements should be included in the invoice confirming the sale, including:

• first and last names or names or short names of the seller and the buyer and their addresses
• tax identification numbers of the seller and the buyer, subject to paragraph 10 and 11
• day, month and year or month and year of sale as well as the date of issue and the sequence number of the invoice marked as "VAT INVOICE"; the taxpayer may indicate on the invoice the month and year of sale in the case of continuous sales
• the name of the good or service
• unit of measure and quantity of goods sold or type of services performed
• unit price of a good or service without the tax amount (net unit price)
• value of the goods or services provided to which the sale relates, without the tax amount (net sales value)
• tax rates
• the sum of the net sales value of goods or services provided with a breakdown into individual tax rates and tax-exempt and non-taxable
• the amount of tax on the sum of the net sales value of goods (services), broken down into amounts related to individual tax rates
• value of sales of goods or services provided together with the tax amount (gross sales value), broken down into amounts related to individual tax rates or tax-exempt or non-taxable
• the total amount due with the tax due, expressed in figures and words

At this point, it should be noted that the legislator used the phrase "at least" in the quoted provision, and therefore specified which elements must be included in the invoice, but did not close this catalog. Means that the entity issuing the invoice may also include other elements in this document. On this basis, the party included additional information on the indicated invoices, such as the order number or the contractor's sales hall number.

Pursuant to § 17 sec. 1 above of the Regulation, a corrective invoice is also issued when the price has been increased after the invoice has been issued, or in the event of a mistake in the price, rate or amount of tax or in any other item of the invoice.It should be noted that by using the phrase "or in any other item", the legislator assumed that the error could be corrected with a corrective invoice.

On the other hand, on the basis of statutory delegations provided for in Art. 106 sec. 10 and 11 of the VAT Act, on July 14, 2005, the Minister of Finance issued an ordinance on issuing and sending invoices in electronic form, as well as storing and making these invoices available to the tax authority or tax inspection authority (Journal of Laws No. 133, item . 1119). In § 4 sec. 2 above of the regulation, the legislator decided that invoices may be issued, sent and stored in electronic form, provided that the authenticity of their origin and the integrity of their content will be guaranteed through electronic data exchange (EDI) in accordance with the agreement on the European electronic data exchange model, if the concluded agreement concerning this exchange, it provides for the application of procedures guaranteeing the authenticity of the origin of the invoices and the integrity of the data. Pursuant to § 5 sec. 1 above of the Regulation, corrective invoices and duplicate invoices for invoices issued and sent in electronic form are sent in the same form. In cases where formal or technical obstacles make it impossible to issue and send the document referred to in para. 1, in electronic form, in particular if the recipient of invoices withdraws the consent to issue and send them in electronic form, the taxpayer shall issue this document in paper form, with an annotation that the corrective invoice or the duplicate invoice, respectively, applies to the invoice issued in electronic form (§ 5 (2) of the above-mentioned regulation).

As the above regulation shows, a taxpayer who issues an invoice in electronic form has the option, in the event of a mistake in any item of the invoice, to issue a corrective invoice and send it in electronic or paper form, when formal or technical obstacles prevent the issuance and sending of such a document in electronic form. .

In the case at hand, the Party stated that in the event of correction of additional commercial data, the re-sending of an e-message, however, in its opinion, there is no issue of another invoice. In the light of the above-mentioned legal regulations, in the event of a mistake in any item of the invoice, the Party should issue a correcting invoice also in electronic form or - if it is not possible from the above-mentioned given reasons - in paper form. One should agree with the position of the tax authority of the first instance that the re-sending of the e-message with the changes made will be another invoice documenting the same sale.

For the above reasons, the Director of the Tax Chamber in Warsaw considers that the party's allegations regarding violation of § 4 point 2 of the Regulation of the Minister of Finance of July 14, 2005 on inserting and sending invoices in electronic form, as well as storing and making available to the tax authority or tax inspection authority these invoices in connection with Art. 106 sec. 1 of the Act of March 11, 2004 on tax on goods and services and in connection with § 9 par. 1 of the Regulation of the Minister of Finance of May 25, 2005 on tax refunds to certain taxpayers, advance tax refunds, issuing invoices, their storage and the list of goods and services to which the VAT exemption does not apply, are not justified in the applicable legal status.

For one can get the impression that the charges raised in the complaint constitute a polemic with the regulations contained in the above-mentioned regulations, not with the interpretation of specific provisions made by the Head of the Tax Office. The director of the Tax Chamber in Warsaw would like to emphasize that the tax authorities operate on the basis of the law and it is not my competence to determine that the taxpayer may not comply with the obligation provided for by law.

At the same time, it is worth pointing out that the activities of the Party or the specificity of the operation of the electronic data exchange program may not cause the adaptation of the law to a specific situation, because it is the taxpayer who is to perform the obligations specified by law, adapting his activities to the requirements indicated therein.

Nor can the party be fair that the decision of the Head of the Tax Office violates Art. 88 sec. 3a, point 3 and art. 108 sec. 1 of the act on tax on goods and services. According to the content of Art. 88 sec. 3a point 3 of the VAT Act - as at the date of submitting the application - do not constitute the basis for the reduction of the output tax and the return of the tax difference or the return of input tax, invoices and customs documents in the event that more than one invoice documenting the same sale has been issued. For in the situation presented by the Party at the time of re-sending the e-message with the changes made - and it does not matter whether they refer to data indicated by the legislator as obligatory or additional data provided by the entity issuing the invoice - more than one an invoice documenting the same event. As indicated above, the legislator, in the event of finding a mistake in the invoice issued, provided for its correction by issuing a correction of the invoice, and not by re-issuing the document. In such a case, the instruction of the norm contained in Art. 108 sec. 1 of the VAT Act, according to which, if a legal person, an organizational unit without legal personality or a natural person issues an invoice in which it shows the amount of tax, it is obliged to pay it. This means that the re-sending of the e-message with the changes made will result in the situation specified in the above-mentioned provision, and the taxpayer will be obliged to pay the tax amount resulting from the invoice inserted in this way.

It should be emphasized once again that the commented on Art. 108 of the VAT Act does not make the obligation to pay tax on goods and services conditional on the sale, but only on the issue of an invoice. Therefore, since the legislator indicated a special procedure for issuing an invoice, this means that also issuing an electronic invoice in the circumstances indicated in Art. 108 of the act on tax on goods and services will result in the necessity to pay the tax.

Referring, in turn, to the Party's allegation that § 18 of the invoice regulation was violated in connection with Art. 106 sec. 10 of the Value Added Tax Act, the Director of the Tax Chamber in Warsaw notes that pursuant to § 18 para. 1 of the Regulation of the Minister of Finance of May 25, 2005 on tax refunds to certain taxpayers, advance tax refunds, issuing invoices, their storage and the list of goods and services to which VAT exemptions do not apply, the buyer of goods or services, who received an invoice or a correcting invoice containing errors in any information related in particular to the seller or buyer or the designation of goods or services, except for a mistake in the invoice items specified in § 9 para. 1-12, may issue an invoice called a correction note. The Party's statement that the buyer is the person authorized to issue the correcting note and not the invoice issuer is correct. However, in a situation where, for any reason, it is not possible to correct an invoice containing errors by issuing a correcting invoice, the position adopted by the body of first instance seems justified.

However, it should be noted that such a position was included in the decision No. 1471 / VTR2 / 443-33b / 07 / MŻ and the Party recognized it as lawful, without submitting a complaint against it.

Taking into account the allegation made in the complaint about a partial legal assessment of the Party's position, the appeal body states that the Head of the Tax Office in the case on the request of the Party of 18 May 2007, issued three decisions, of which the Party appealed against two of them. In each of the issued decisions, the tax authority referred to some of the Party's inquiries contained in the above-mentioned the application. For this reason, the position of the Head of the Tax Office contained in the complained decision No. 1471 / VTR2 / 443-33c / 07 / MŻ, in which the answer to question No. 4 of the application was provided, is the tax authority's attitude to only this part of the application and only the position of contained in all three provisions will constitute a written interpretation of the provisions referred to in the Party's request.

The director of the Tax Chamber in Warsaw, assessing the appealed decision of the first-instance body, cannot agree with the allegations that it fails to meet formal requirements, such as the legal assessment of the questioner's position or clarification of the legal basis. The Head of the Tax Office made a legal assessment of the questioning party's position as well as provided a written interpretation as to the scope and manner of applying tax law in an individual taxpayer's case. Therefore, the lack of approval of this interpretation by the Party may not constitute grounds for a claim of violation of the law.