Extension approved until February 28, 2028
The EU Council approved Poland’s continued application of the split payment mechanism in value added tax (VAT), which derogates from Article 226 of Directive 2006/112/EC, until February 28, 2028.
The split payment mechanism applies to certain supplies of goods and the provision of certain services that are susceptible to fraud, with the invoice value exceeding PLN 15,000 gross. As part of it, suppliers and service providers must hold separate, blocked VAT accounts to which VAT amounts are transferred, while the net amount is paid to their regular accounts. The funds in the blocked account can only be used for specific purposes, such as paying VAT owed to the tax authority or VAT from invoices received from other suppliers or service providers. In cases where input VAT exceeds output VAT, the refund must be made within 60 days to the taxpayer's regular account.
Read a January 2025 report prepared by the KPMG member firm in Poland