When should I register for VAT purposes in Poland?
Polish legislation does provide any specific case examples for when registration for VAT in Poland is required. Because of this, the situation must be analyzed separately for each case. In general, the EU rules apply, i.e. a company must register for VAT purposes in Poland in the following situations:
- A foreign company has a permanent establishment in Poland in the meaning of EU VAT rules from which the services are provided or goods are supplied, and the place of supply is the territory of Poland.
- A foreign company does not have a permanent establishment in Poland in the meaning of EU VAT rules, but it supplies goods or services in Poland for which the buyer does not need to account for VAT (i.e. the reverse charge procedure does not apply).
Examples of the above-mentioned situations include: Provision of services to natural persons, leasing of properties such as offices or warehouses, or hiring employees on the territory of Poland.
We always recommend analyzing the planned business model with regard to the need for registration for VAT purposes.
What is the VAT rate and what are the legal foundations?
The standard VAT rate in Poland is 23%. There are reduced rates of 8% and 5% on selected products such as some foodstuffs, books, newspapers and certain types of services. Some services are exempt from Polish VAT, such as financial and postal services. There are many variations of the rates given above.
VAT is governed by the Value Added Tax Act of 11 March 2004 (Law Gazette No. 54, item 535 with amendments). The law is only available in Polish.
My activity in Poland would suggest that I need to register for VAT. However, I only intend to generate a small amount of sales in Poland. Do I still have to register?
Yes. Foreign companies generating sales taxable in Poland have to register for VAT irrespective of their taxable revenue. You should register before you start your first taxable activity in Poland.
Do I need a tax representative?
In principle, yes. Businesses established outside the EU are obliged to appoint a tax representative within the meaning of the VAT Act.
A tax representative is an entity that represents a taxpayer who has neither their physical nor their business domicile within the territory of the European Union.
A special aspect here is that the tax representative in Poland is liable for the taxpayer's tax liabilities.
I already operate in other EU countries. Will that make it easier to proceed?
Yes. Since 2011, there has been the definition of a permanent establishment within the meaning of VAT legislation in the European legal system.
A permanent establishment is any establishment (place), other than the seat of economic activity that has a sufficient degree of permanence and a structure enabling it, in terms of staffing and technical equipment, to receive and use services there that are provided for the establishment's own needs (Article 11 Council Implementing Regulation (EU) No 282/2011).
If your company has a permanent establishment in the EU, you do not need tax representation in Poland. However, the definition of a permanent establishment is relatively imprecise and ambiguous. For this reason, we always recommend analyzing the facts with a tax advisor to determine whether a permanent establishment exists.
Which documents do I need and where do I have to submit them?
All documents must be submitted in Polish. Foreign language documents should be translated into Polish by a sworn translator.
Forms:
- Form NIP-2 (Available in Polish)
- Form VAT-R (Available in Polish)
Documents:
- Articles of association (certificate of incorporation/notarial deed/statutes).
- Current extract from the Swiss Commercial Register.
- Current confirmation of VAT registration in Switzerland.
- Agreement with a bank confirming the opening of a bank account in Poland or a declaration of non-application for a VAT refund.
- Agreement with an accounting firm.
- Proxy if the company appoints an authorized representative.
- Detailed description of the company's activities in Poland.
- If fiscal representation is required - notarial deed or contract between the fiscal representative and company and certificate from the tax office stating that the conditions for acting as a fiscal representative are fulfilled - valid for up to 4 months.
The tax office responsible for all foreign companies is the second tax office in Warszawa - Śródmieście.
Registration usually takes around 4 to 6 weeks to complete.
Information status: March 2021
