CJEU judgment on accounting for VAT on intra-Community acquisitions of goods and import of services

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Maciej Woźnica

18 March 2021

Today the Court of Justice of the European Union (CJEU) has issued a judgment in a Polish case regarding the accounting for VAT on intra-Community acquisitions of goods (C-895/19).  In the judgment, the CJEU found that Polish regulations are in breach of the principle of VAT neutrality and are incompatible with the EU VAT Directive.

The CJEU assessed Polish national regulations according to which the deduction of input VAT on intra-Community acquisitions in the same accounting period as output VAT is conditional on disclosing the output VAT in a return submitted within three months of the end of the month in which the tax liability arose with respect to the acquired goods (the so-called "separate recognition").

What does it mean for taxable persons

This judgment means that taxable persons may claim a refund of interest paid so far on tax arrears resulting from disclosing output tax arisen on intra-Community acquisitions of goods and the corresponding input tax in different accounting periods.

In our opinion, due to very similar rules of accounting under the "separate recognition" regime, this judgment may be the basis for claiming a refund of interest on import of services.

If you have any questions concerning the specific rules for claiming said interest, please do not hesitate to contact Rödl & Partner experts.