- Who accounts for VAT
- Standard Audit File for Tax or SAF-T
- VAT OSS
- VAT MOSS vs. VAT OSS
- One-Stop Shop
- Intra-Community Distance Sales of Goods
- Germany’s recycling fee
Entrepreneurs are obliged to register and account for VAT unless:
they do not exceed the annual sales limit set in the Country (subjective exemption)
they conduct sales that are exempt from VAT (subjective exemption)
Even if there are periods in which your business has not engaged in any taxable activities, you should submit a zero VAT return.
Once registered for VAT purposes, an entrepreneur is required to submit:
VAT returns (monthly or quarterly)
summary information (ECSL) - when you are involved in the movement of goods in EU member states (for B2B sales)
Intrast reports (statistical system collecting and monitoring exports and imports of goods within the European Union)
Standard Audit File for Tax (SAF-T)
Intrastat is a list of all intra-community supply transactions between companies and other businesses. The INTRASTAT system collects information regarding the status of intra-community transactions. As an entrepreneur, you have to report information on imports of goods and exports of goods to European Union countries. Intrastat was created precisely for this purpose.
INTRASTAT - who is obliged to submit the declaration?
The obligation to submit INTRASTAT declarations applies to natural and legal persons and organizational units without legal personality, which are VAT payers that enter into transactions with other European countries and have exceeded certain thresholds contained in each country. The statistical thresholds are set separately for imports and exports.
INSTRASTAT - who has to provide information on international trade?
If you operate in the European Union markets then one of your company's obligations is to submit INSTRASTAT declarations, but only if the value of goods trade with European Union countries exceeds certain thresholds set in each country in the calendar (reporting) year or in the year preceding the reporting year.
SAF-T is the English equivalent of the Polish JPK (Jednolity Plik Kontrolny). It should be submitted from the first month of running one's own business electronically to the Tax Office by companies that are VAT payers and submit VAT-7 declarations to the tax authorities. This file is a special format for sending data and information to the Ministry of Finance, allowing it to be easily read by control mechanisms. All companies must generate SAF-T(including micro-entrepreneurs) issuing invoices and settling accounts with customers on the basis of invoices.
STANDARD AUDIT FILE FOR TAX - what does it consist of?
SAF-T has a specific format designed to facilitate its processing. Currently, SAF-T consists of seven structures:
JPK_KR - accounting books
JPK_WB - bank statement
JPK_MAG - warehouse
JPK_VAT - records of the purchase and sale of VAT
JPK_FA - VAT invoices*
JPK_PKPIR - tax revenue and expense ledger
JPK_EWP - records of revenue
as of April 1, 2020 for large companies
as of July 1, 2020 for SME
SAF-T - who is exempt?
If you run a sole proprietorship that is exempt from goods and services tax, you are not required to submit a SAF-T file. Remember that the VAT exemption is only available to companies whose turnover does not exceed PLN 200,000 per year.
VAT OSS or One stop shop is an alternative VAT settlement method for mail order sales for European Union businesses selling remotely to B2C customers in the EU. The procedure came into effect on July 1, 2021.
The main principle of this system is that declarations and output tax are submitted to the Tax Office in one EU country, and the Tax Authorities of that country provide the amount to local Tax Offices in other EU countries. Settlement for transactions is possible in a single declaration in Euro currency, and the declarations themselves are quarterly.
VAT MOSS a VAT OSS
The Mini One Stop Shop (MOSS) procedure that came into force in 2015 was intended to make it easier for vendors to account for electronic services. The procedure applied only to telecommunications, broadcasting and electronic services. MOSS allowed vendors to settle electronic services that were performed abroad and their limit did not exceed €10,000, to settle them in Poland. Once the limit was exceeded, there was an obligation to register directly for VAT in the countries where this amount was exceeded.
VAT OSS is an extension of the Mini One Stop Shop and was created for e-commerce services, replacing the MOSS procedure, which was in effect until June 30, 2021.
Each member state under the VAT OSS has been required to set up an electronic system - the One Stop Shop. This system allows electronic registration for the One Stop Shop procedure in one member state in the European Union, as well as submission of electronic returns and payment of the output VAT for all sales within the OSS.
Intra-Community Distance Sales of Goods
Entrepreneurs may sell their goods to individuals from other European Union countries via mail order. As of July 1, 2021, this type of sale is referred to as intra-Community distance sales of goods.
In order to be referred to as intra-Community distance sales of goods, the following conditions must be fulfilled:
1. 1. the purchaser is a private person who is not a VAT payer or a purchaser (who is a taxpayer or a non-taxpayer legal entity) for which intra-Community acquisitions of goods are not subject to VAT
2. 2. the goods supplied are not new means of transportation or goods that are assembled or installed.
Germany’s recycling fee
Germany is one of the world’s leading countries in waste management. Recycling laws are highly respected and socially supported there. At the moment, Germany recycles more than 60% of all garbage. The cost of recycling has been passed on to manufacturers, German as well as foreign, and thus they have been required to pay a recycling fee.
The LUCID system is Germany's public packaging registry, established as a result of an amendment to the VerpackG packaging law.
Business entities introducing goods into the German market, and at the same time supplying packaging to Germany, are required to register in the LUCID system and to pay all fees arising from the regulation.
As of July 1, 2022, an amendment to the German VerpackG packaging law came into force. The 01.01.2019 law established, among other things, the LUCID packaging registry and, following the amendment, expanded it to include the need to record transport packaging.
All companies that distribute packaged products to the retail market as well as to private entrepreneurs are required to pay a recycling fee.
Importantly - there are no minimum quantity thresholds when it comes to shipping packages to DE, even sending one package per year, the entrepreneur is required to pay the recycling fee.
Do you sell your products online?
Are you planning a foreign market expansion of your business? Are you starting selling on Amazon or eBay? Did your company exceed sales thresholds in cross-border selling and you are obliged to register for VAT in the recipient countries?
Team Leader, VAT Compliance