The split payment will mean that VAT should be paid into a dedicated (locked) bank account of the supplier, from which the Polish tax authorities can withdraw the VAT payable as reported in the periodic VAT Return. The split payment may apply to payments or pre-payments (for services / goods) made to the special accounts kept by banks established in Poland. Taxpayers that opt to use the split payment method will have some advantages, e.g.:
- in case of supplies of the goods listed in the Appendix No 13 to the VAT Act the joint and several liability of the customer together with the supplier will not apply;
- 30% (20%) and 100% additional sanction will not apply to incorrectly deducted input VAT;
- the higher percentage (i.e. 150% of the standard level of the penalty interest) will not apply to overdue VAT for the period in which in submitted VAT return the taxpayer reported input VAT from invoices which in 95% have been paid using the split payment;
- if the taxpayer decides to pay VAT to the tax office before the statutory deadline for payment, it will be allowed to pay a discounted amount of VAT; the Draft indicates the special formula allowing to calculate the amount of the discount.
Please be aware that the new law still needs to pass the Polish Parliament, so there can be changes to the above.