National e-Invoicing System

by Przemysław Trzaska

31 May 2022

Regulations introducing e-invoices to the common business exchange in Poland have been in force since 1 January 2022. So far, e-invoices have been used only between ordering entities and contractors in public procurement contracts via the Electronic Invoicing Platform (EIP or PEF in Polish).

E-invoices

The new law makes structured invoices (e-invoices) one of the available forms of documenting transactions, in addition to hard copy invoices and the currently used electronic invoices. Taxpayers will issue and receive invoices via an ICT system called the National e-Invoicing System (NeIS or KSeF in Polish).
The solutions proposed in the bill are absolutely voluntary. However, structured invoices will become mandatory in 2023.

Originally, structured invoices were supposed to be mandatory for all VAT taxable persons – both Polish and foreign. However, the European Commission did not agree to such an extensive scope of application.
Now, the new obligation will apply only to those established in Poland. It looks like invoices for import of services and ICA will have to be processed via the NeIS as well. Apart from the above general guidelines, details are yet unknown. In practice, however, it may be necessary to go back to so-called internal invoices.

Structured form

According to the statutory definition, a structured invoice is an electronic invoice. However, the regulations on structured invoices make them practically a third type of invoice, besides the current hard copy and electronic invoices.

The existing electronic invoices are most often saved as PDF files, but other formats, e.g. JPG, are also allowed. In such a case, even though the invoice file format is usually the same, the form in which data are presented differs and depends on the invoice issuer’s system. This means that from a practical point of view, an electronic invoice is a scanned hard copy invoice or its digital image.

The structured form, in turn, is in a standardised XML format, like the one that is utilised in Standard Audit Files for Tax. The format requires that data are saved according to a certain standard. Consequently, the structured invoice is a file in XML format containing the same details as the traditional invoice. However, the data (e.g. seller’s and buyer’s details, amounts, subject of sale, dates) will be presented in a uniform way no matter who issues the invoice.

National e-Invoicing System

The structured invoices are issued via the National e-Invoicing System. The NeIS is designed to be a national ICT platform for comprehensive handling of invoices in Poland, especially to:

• issue, send and receive structured invoices;
• store structured invoices (for 10 years);
• assign system-generated identification numbers;
• check such invoices for compliance with a pre-defined and publicly available invoice format;
• analyse and control data from structured invoices;
• send messages about issuance, rejection or failure to issue a structured invoice.

New invoices – new rules of issuance and acceptance

The new type of invoices which exists exclusively in digital form means that additional issues connected with their issuance and delivery need to be regulated.

Invoice acceptance

Structured invoices may be issued only if the invoice addressee first accepts this form of invoicing. The invoice recipient's prior consent to electronic invoicing is not enough to use structured electronic invoices. The addressee has to give separate consent to invoicing in the structured form.

Delivery and issuance

A structured invoice is issued and delivered via a software interface.

Such an invoice is considered issued and delivered on the date the NeIS assigns an identification number to the invoice in the system, no matter who it is issued to – the taxable person or another buyer of goods or services.

Please note that a structured invoice is deemed delivered once it is made available through the software interface. This seems to be particularly important to preserve the system integrity and prevent exchange of structured invoices outside the NeIS. If a structured invoice is delivered in any way other than via the NeIS and the invoice recipient deducts tax from such an invoice, he faces the risk of having the right to deduct challenged.

Right to deliver and issue

Before issuing a structured invoice, the taxpayer has to report to the head of his local tax office people and entities authorised to access the NeIS to issue invoices. These may include:

• a taxpayer’s employee;
• a designated accountant;
• an accounting firm (in a separate notification it will be possible to specify the firm’s employees authorised to get access);
• any other individual or entity.

Sole proprietors do not have to notify the tax authorities – they have the rights granted automatically. A taxpayer would need to notify the authorities if he authorises a third party to issue invoices.

A taxpayer is obliged to notify the tax authorities also of people and entities authorised to access the NeIS in order to download structured invoices. Therefore, it is possible to assign rights only to download and post invoices, e.g. to an accountant, but not to issue invoices.

Technical aspects

In addition to the NeIS platform itself, the Ministry of Finance will share with taxpayers a template of the structured invoice, as well as an API interface and a dedicated website on the tax portal. This will require implementation of certain technical solutions.

Generating and sending invoices via NeIS

Invoices may be prepared directly in taxpayers’ accounting systems and sent to the NeIS via an API. Taxpayers will have to be authenticated in the system to be able to do this. Once authenticated, a taxpayer may:

• go through all structured invoices issued and received;
• send any invoice or a set of invoices in XML format or convert it to PDF.

Upon sending an invoice, the NeIS assigns an identification number in the system and adds the date and time. The invoice identification number is a system number and should not be confused with the actual invoice number assigned by the taxpayer upon invoice issuance.

Every taxpayer may now also use his individual account in the e-invoices system to issue invoices on the template available on the electronic platform of public administration services (web application e-Mikrofirma or e-Microbusiness in English).

Incoming structured invoices are available also via the interface software after the invoice recipient is first authenticated in the system by means of a qualified signature or a trusted profile (via API or the electronic platform developed for this purpose).

If the buyer is a consumer who has consented to receiving structured invoices, he may receive them also through software. In this case, the invoices are delivered only via a dedicated electronic platform. No logging in or authentication by means of a qualified signature or trusted profile will be needed.

Authorisation

The solution relies on the authorisation model, i.e. an individual needs to be authorised in the system. The authentication will be done via a trusted profile or a qualified signature. The authentication cannot be done on the basis of authorisation data. After the authentication, the system will check the individual's rights.
It is also possible to access single structured invoices anonymously on a dedicated online platform by entering a series of unique invoice characteristics, e.g. the identification number assigned by the NeIS and other invoice components, without the need for authentication in the system.

Benefits of e-invoices

Given that the scheme is supposed to be voluntary, the Ministry of Finance has prepared a number of incentives and simplifications to anyone who switches to this invoicing model.

Shorter deadline for VAT refund

A taxpayer who uses structured invoices will be able to benefit from a 40-day deadline for VAT refund if he meets the following conditions:

• issues exclusively structured invoices throughout the accounting period;
• is registered for VAT and files tax returns for each period in the 12 consecutive months preceding the period for which he applies for refund;
• holds a whitelisted checking account or personal account in a credit union for 12 consecutive months preceding the period for which he applies for refund;
• the refund amount does not exceed 3,000 zloty.

However, if the grounds for refund need to be double-checked, the head of tax office may extend the deadline until the taxpayer’s accounts are checked.

No need to collect documentation underlying correcting invoices

If a taxpayer issues correcting invoices using the NeIS, he will not need to follow the regulations which require him to have documentation confirming the agreement on terms of the correction and fulfilment of conditions for the reduction of the taxable base. The taxpayer will be able to reduce the taxable base and the tax amount already in the accounting period in which he issues a structured correcting invoice.

Certain simplification measures are planned also in respect of input tax. A buyer of goods or services who receives a structured correcting invoice which reduces the taxable base must reduce the input tax amount in the tax return for the period in which he receives the correcting invoice.

Minor benefits

Structured invoices bring the following simplifications:

• no need to deliver an invoice copy or certain invoice details in the case of an ICS of new means of transport for the buyer;
• extended list of circumstances in which, besides the business checks, the authenticity of origin and integrity of contents of electronic invoices will be deemed maintained, especially if the National e-Invoices System is used;
• no more duplicate invoices;
• no need to submit a Standard Audit File for Tax in respect of invoices (JPK_FA file) at the tax authorities’ request.

Automated posting

Another benefit is the automation of accounting processes. Currently, a human being is needed to read hard copy or electronic invoices. Indeed, the reading process may be automated to a certain extent by utilising optical character recognition (OCR). However, this technology is still far from perfect, especially if the scanned invoice is of poor quality.

A structured invoice has this advantage over traditional invoices that it contains all the information in a harmonised form. This means that no human or OCR software needs to read the invoice. Invoice details may be automatically imported to the system and processed.

Summary

NeIS and structured invoices are the next step in the digitalisation of the tax and accounting world. Without doubt, the implementation period will pose a challenge but also create an opportunity for extensive process automation.

The system is currently voluntary and incentives are set to lure taxable persons. Still, be mindful that the system will be mandatory at the end of the day. Therefore, it is worth taking the first steps to implement this solution.

If you are interested in further information or support in preparation for the implementation of the National e-Invoicing System, you are welcome to contact Rödl & Partner experts.