SLIM VAT – explanatory notes from the Ministry of Finance

Aleksandra Majnusz

1 June 2021

On 23 April 2021, the Ministry of Finance issued its explanatory notes on the Slim VAT package and selected solutions clarifying the VAT Act.

What are these notes about

The explanatory notes analyse the Slim VAT package regulations and include examples of their use in practice. The new rules of issuing correcting invoices seem to be most important. The Ministry of Finance has used examples to explain what in a given situation should be considered as an agreement on the correction conditions, their fulfilment and what documentation is appropriate to demonstrate the same.

The explanatory notes also elaborate on:

• consistent exchange rates for VAT and income taxes;
• increased limit for the so-called unrecorded gifts of small value and the value of the so-called recorded gifts;
• extended deadline for deducting input VAT "on an ongoing basis";
• deduction of input VAT from invoices for the purchase of accommodation services for resale;
• application of new regulations on binding VAT rate information;
• amended solutions regarding the split payment mechanism;
• new rules for accounting for VAT on advances received for export of goods.

The explanatory notes will certainly prove helpful to many Polish taxpayers. The Ministry has tried to interpret the new regulations in such a way as to impose on enterprises as few additional obligations as possible and to allow them to use the commercial documents they already have for VAT purposes. Still, the explanations alone are not sufficient to understand the new regulations.