Quick Fixes is a package of amendments relating to VAT in intra-Community trade, aimed at simplifying and harmonizing settlements in individual Member States.

On 1 July 2020, the bill amending the Polish VAT Act to implement the provisions of Council Directive (EU) 2018/1910 and Council Regulation (EU) 2018/1909 came into force, pursuant to the rules set out in Council Implementing Regulation (EU) 2018/1912.

Quick fixes relate to three areas:

  • Chain transactions across the EU,
  • Call-off stocks in the EU,
  • Conditions for applying VAT zero rate to intra-Community supplies (ICS).

Chain transactions

The new provisions bring about the definition of an “intermediary operator” (meaning a supplier within the chain other than the first and the last supplier in the chain who dispatches or transports the goods).

The newly introduced provisions provide for simplified identification of ICS for ‘intermediary operators’, yet, they do not specify the criteria to assess whether such an entity actually exists in a given chain. Our experience so far shows that correct assessment of whether a given entity acts as an intermediary operator is not only difficult but involves an extensive analysis of transactions from various angles.

Thus, in our opinion, the application of the new regulations for chain transactions requires a comprehensive analysis, and in case of doubts, should be confirmed by an individual tax ruling.

Importantly, the new regulations pertain exclusively to intra-Community trade, with the chain transactions including import and export being settled according to the current rules, i.e. taking into account the terms of delivery (with any related doubts persisting).

Call-off stock

The purpose behind introduction of the new provisions was to simplify call-off stock arrangements in individual Member States.

Under the call-off stock procedure, VAT registration for goods transported from a Member State of origin to a Member State of destination is not required, provided that the goods will be further dispatched in the Member State of destination.

One of the most important amendments provides for limiting the period after which the transfer of goods not collected from the call-off stock become subject to taxation in accordance with the rules applicable to the transfer of own goods. Currently, to avoid the tax obligation, goods may be stored in the warehouse for a maximum of 12 months (vs 24 months under the previously applicable rules).

Importantly, application of the new call-off stock provisions extends beyond goods which are used for production or provision of services to cover commodities. Consequently, it may be applied by a wider group of taxpayers.

Zero rate on ICS

Under the new provisions, one of the main requirements for eligibility to charge VAT at the rate of 0% in the case of intra-Community supplies (ICS) is for the taxable person to hold a valid VAT number (up to now the requirement was of formal nature) and for the supplier to submit a correct VAT-EU recapitulative statement.

Additionally, Council Implementing Regulation (EU) 2018/1912 introduces the assumption that if in possession of certain documents listed therein, goods under intra-Community supply are dispatched from Member State to another Member State and the taxable person can apply the 0% VAT rate.


How we can help

Each amendment to VAT regulations, in particular such a comprehensive one as the Quick fixes package, requires verification of the compliance of the planned transactions against the new wording of the regulations and the approach adopted by the tax authorities. This is why, KPMG may support you in the following areas:

  • analysis of the existing and projected chain transactions of the organization against the amended VAT regulatory framework;

  • analysis of the existing methods of transaction settlement in order to identify opportunities to improve them through the use of the call-off-stock procedure;

  • compliance analysis and subsequent revision of the organization’s call-off stock procedures;

  • development of internal procedures for ICS with special regard to the new recording obligations;

  • providing training to the employees of tax, commercial and logistic departments responsible for collecting and delivering data included in the VAT returns.

See also