Split payment obligatory for the next 3 years

The split payment mechanism means that a payment for a good or service made by a purchaser by means of the so-called credit transfer message is split into a net amount and a VAT amount. The VAT amount goes to the VAT account, which is an additional account linked to the main existing account. The additional account is created automatically by a bank.

Split payment is an obligatory mechanism for certain VAT taxpayers. The split payment mechanism is obligatory if the two following conditions are met simultaneously:

• the VAT taxpayer sells or purchases "sensitive" goods or services, i.e., goods or services listed in Attachment No. 15 to the VAT Act,
• the total amount due under the invoice, i.e., the gross value of the entire invoice, exceeds PLN 15 000.

Split payment to be obligatory by 2025

On 1 November 2019, obligatory split payment mechanism replaced the reverse charge on sensitive goods in domestic trade and was supposed to be applied in Poland until 1 March 2022. However, the European Commission has agreed to extend the application of split payment in Poland.

Thus, the obligatory split payment mechanism will apply for another 3 years, i.e., from 1 March 2022 to 28 February 2025.