Tax customs & excise

From November 1, 2019, the obligatory Split Payment Mechanism (MPP) for the delivery of certain goods and services with a value exceeding PLN 15,000

Taxpayers who pay for the delivery of goods and services from the newly added Annex 15 to the VAT Act with a value above PLN 15,000 gross are required to make a payment through the split payment mechanism. The said Annex 15 replaced the previous Annexes 11,13 and 14. It mainly includes coal products, animal and vegetable oils and fats, inks, emulsions, drawing inks, stretch films, ferro-alloys, steel and rolled products, ducting, pipes and base metals , computers and peripherals, car parts, sale of parts for motor vehicles and motorcycles, construction works.

Taxpayer issuing the invoice for the abovementioned goods and services must include the words ‘split payment mechanism’.

Therefore, the buyer is obliged to make payments in the MPP system with a value above PLN 15,000 for goods and services from Annex 15, even if the supplier did not include the abovementioned form on the issued invoice. Therefore, he must control the correctness of invoices issued by the contractor.

As a result, the seller and buyer are required to have a settlement account at the bank or credit unions.

In the event of failure to comply with the above obligations, the VAT Act imposes sanctions of 30% of the tax amount per specific delivery, if the invoice does not have the „split payment mechanism” designation, or if the buyer made a payment bypassing the MPP despite its obligation. If the taxpayers are natural persons, he is subject to penalties from KKS instead of the sanction rate in VAT. In addition, in the event of non-payment, the recipient is jointly and severally liable with the invoice issuer for unpaid VAT.

In addition, from January 1, 2020, failure to make a payment using MPP will result in the inability to include such payment in tax deductible costs.

Author team leader DKP Legal
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