Starting September 1, Poland will publish online a new database of VAT registered businesses. It is a list of VAT payers, which contains several important information about entities conducting business activity in Poland. The list will include, among others, bank account numbers of VAT taxpayers.
Besides the monthly SAF-T VAT file in Poland, companies have to be able to meet the SAF-T obligation 'on request' containing different legal requirements. This submission applies in case of a preliminary tax inquiry, a tax audit and tax proceedings where the SAF-T file should be provided to the PL tax authorities in a short timeframe. To avoid disputes and or penalties it is therefore important that a company is ready.
When a buyer makes a payment larger than PLN 15,000 to a supplier who is not on the list, the buyer's can no longer deduct the expenses for income tax purposes. Payments made to accounts not included in the lists, the buyer will result in joint liability for the VAT obligations - up to the VAT amount of the underlying transaction - of the supplier.
The sanctions will become effective as of January 1, 2020.
The single list contains the following information:
Entities which were not registered for VAT purposes (or were de-registered);
Entities registered as the VAT taxpayers (i.e., data on active and exempt VAT taxpayers), including entities whose registration as VAT taxpayers has been restored.
Bank accounts numbers indicated in the tax identification or update notifications.
The list can be maintained and updated daily.
What does it mean?
Taxpayers should integrate the white list check as a mandatory internal control during payment and settlement processes. From a tax perspective, the following adjustments need to be made to minimize tax risks:
Verify, before executing a payment (i.e., on the day of the transfer order) that payment is made to bank account included in the list; and
Once payments are executed, verify whether payments were made to bank accounts contained in the list
Notify the head of respective tax office about any potential errors within three days from the transfer order date to avoid sanctions.
What do we offer?
For companies running SAP, we have developed an SAP add-on where the relevant data can be checked automatically. The add-on populates from SAP all relevant data available in the white list and validates in a batch job this data with the data of white list. Errors and correctness will be displayed in the cockpit.
The results are also archived in SAP. A taxpayer can prove during a future tax audit that it has implemented 'state of the art' tax controls. From tax risk management, it is also possible to check the transactions that already took place.
At first the tax authorities limit the number of queries per day per taxpayer. However, starting in November 2019, it is possible to download the entire online list published by the authorities. We have anticipated during our R&D about this new situation already, and our add-on will, therefore, have a future feature to facilitate your tax risk management.
What is an SAP add-on?
An SAP add-on enhances standard SAP itself.
Add-on components are extra functionalities that do not come with the main SAP product. Different organizations have different requirements. SAP has recognized that and facilitated that additional functionality can be added and that such functionality as a component can be integrated with Standard SAP.
An add-on is permitted by SAP – the code 'ABAP' is written and transported where SAP allows it. That means these add-on components sit above the core and access the same dictionary objects or repository objects and perform the required functionality. It contains custom authorization objects according to SAP standards.
SAP add-on solutions are, therefore, without an external interface or external software and can be implemented with minor or no SAP impact in any other area. An SAP add-on does not change the programming code of SAP. As a result, SAP upgrades do not lead to any problems, and maintenance is straightforward. Additional functionality is added to Standard SAP.
Written by Richard Cornelisse
Richard advises multinational businesses in improving the efficiency and effectiveness of their Indirect Tax Function and Tax Control Framework.
He started his career as a manager at Arthur Andersen and then became an EY partner where he led the indirect tax performance team for Netherlands and Belgium. Currently, he is a managing director of SAP Tax Consultancy Firm.
Richard has over 20 years of experience advising clients on international VAT issues. He is specialized in the tax aspects of financial transformations, shared service center migration, and post-merger integration work.