Tax obligation in intra-community acquisition and supply of goods

Poland’s accession to the European Union on May 1^st, 2004, brought changes to the rules governing trade with EU Member States. Intra-Community supply of goods (hereinafter: ICS) replaced the concept of export of goods, while intra-Community acquisition of (hereinafter: ICA) replaced the concept of import of goods. The terms “export” and “import” are now reserved exclusively for transactions with entities outside the European Union, i.e., with non-EU countries.

This article describes the issue of the moment at which the tax obligation arises in the case of ICS and ICA. In practice, this means determining the date on which a given intra-Community transaction should be recorded in the JPK_V7 file for VAT purposes.

According to the provisions of the VAT Act (Article 20(1) and (5)), the tax obligation in the case of these transactions may arise in two ways, depending on which date occurs first:

• it arises at the moment the invoice is issued by the taxpayer,
• but no later than on the 15th day of the month following the month in which the delivery of goods (subject to ICA or ICS) took place.

This means that, typically, an ICA transaction should be reported in the month in which the counterparty from another EU Member State (or, in the case of ICS, the Polish taxpayer) issues the invoice. However, if the invoice is not issued—particularly in the month of the goods’ delivery—the tax obligation arises no later than on the 15^th day of the following month.

To summarize, in practice this means that if:

• The taxpayer made an ICA or ICS on March 3^rd, and the invoice was also issued on March 3^rd – the tax obligation arises on March 3^rd – the transaction should be reported in JPK_V7 for March.
• The taxpayer made an ICA or ICS on March 3^rd, and the invoice was issued on April 5^th – the tax obligation arises on April 5^th – the transaction should be reported in JPK_V7 for April.
• The taxpayer made an ICA or ICS on March 3^rd, and the invoice was not issued (or was issued after April 15^th) – the tax obligation arises on April 15^th – the transaction should be reported in JPK_V7 for April.

Note! It’s important to highlight that the legislation refers solely to the date the invoice is issued, not the date it is received. In practice, this causes complications, as invoices are often sent with delays, making it impossible to report the transaction in the original VAT return on time. . In such a situation, a correction of the JPK_V7 must be made for the month in which the invoice was issued = when the tax obligation arose according to the law (unless the invoice was issued after the 15^th day of the month following the delivery).

Tax obligation when moving own goods

In the case of non-transactional movement of own goods by the taxpayer or on their behalf, there is no “supply of goods” (this concept was explained in a previous article in the Mr. Tax Academy series).

So how is the moment of tax obligation determined in this case?

It is worth referring to VAT Directive Articles 67(1) and 222. They state that for ICS and ICA, the tax obligation arises at the moment the invoice is issued. If no invoice is issued, the obligation arises on the 15^th day of the month following the month in which the taxable event took place. This event refers to the non-transactional movement of own goods to the territory of another Member State.

1. However, as is often the case in regulations, the legislator has provided exceptions to the above rules: The first is a catalog of cases listed in Article 13(4) and Article 12(1) of the VAT Act. These provisions regulate exceptional circumstances of moving own goods – i.e., cases that initially did not meet the definition of ICS or ICA but began to do so once those exceptional circumstances ceased. In such a case, the tax obligation arises at the moment those circumstances cease.
2. In the case of intra-Community acquisition of new means of transport, the tax obligation arises at the moment the goods are received, but no later than when the VAT invoice is issued.

What happens in the case of advance payments?

The general provision in Article 20 of the VAT Act regarding the moment of tax obligation in intra-Community transactions emphasizes the date the invoice is issued by the supplier.

It is worth emphasizing that payment of all or part of the amount due before the ICA or ICS is completed does not give rise to a tax obligation. This means that an advance payment received from an EU counterparty for an intra-Community transaction should not be documented with an advance invoice. However, if the seller decides to issue such an invoice, it does not create a VAT settlement obligation for the buyer under ICA or ICS.

The key factor determining the moment when the tax obligation arises is the date of delivery of the goods and the issuance of the final invoice by the supplier.