Joint and Several VAT Liability for Intangible Services

A purchaser’s joint and several liability for VAT not paid by a seller is not new to the Polish tax system. Currently, it applies only to transactions involving “sensitive goods” listed in Annex 15 to the VAT Act, including steel products, electronic equipment, vehicle parts and construction works.

If a seller fails to pay VAT on a transaction involving goods listed in Annex 15, the purchaser is jointly and severally liable for that tax. Liability covers the portion of the seller’s arrears corresponding to VAT on supplies made to that purchaser. The tax authority may therefore seek unpaid VAT directly from the purchaser to the extent arising from transactions between them.

To avoid liability, the purchaser must show that there were no reasonable grounds to suspect that all or part of the VAT on the supply would not be paid to the competent tax office.

Joint and several VAT liability does not cover transactions documented by an invoice with a total amount exceeding PLN 15,000 or its foreign-currency equivalent. The exclusion also applies where payment was made using the split-payment mechanism.

The proposal would extend the mechanism to intangible services, transferring the risk of joint and several VAT liability to purchasers of those services. A new Annex 16 to the VAT Act would list the services covered, particularly those classified as:

1. PKWiU 62.01 — software-related services
2. PKWiU 62.02.2 — computer software consultancy services
3. PKWiU 63.11.12 — website management (hosting) services
4. PKWiU 69.20.2 — accounting and bookkeeping services
5. PKWiU 70.22 — other business and management consultancy services
6. PKWiU 71.11.24 — advisory services for architectural and construction projects
7. PKWiU 72 — scientific research and development services
8. PKWiU 73.1 — advertising services
9. PKWiU 73.2 — market research and public opinion polling services
10. PKWiU 74.90 — other professional, scientific and technical services not elsewhere classified
11. PKWiU 78 — employment services
12. PKWiU 82 — office administrative and other business support services.

Joint and several liability for a supplier’s VAT would apply to these intangible services where the invoice total exceeds PLN 15,000. It would also apply where the total monthly value of services purchased from one supplier, excluding VAT, exceeds PLN 50,000. Once that threshold is exceeded, all services purchased from that supplier in the month would be covered, regardless of individual invoice values.

For intangible services, the tax authority would likewise need to establish that, when the services were supplied, the purchaser knew or had reasonable grounds to suspect that all or part of the

VAT on the services would not be paid to the tax office. Grounds for suspicion would particularly include terms departing from normal business practice, especially a price below market value without economic justification.

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The proposal also changes protection for businesses using split payment. It would no longer always provide the current level of VAT protection. Once the amendment takes effect, split payment would not guarantee protection where the taxpayer knew that the paid invoice documented transactions involving abuse of law. Abuse means transactions that meet formal statutory requirements but are essentially aimed at obtaining a tax advantage contrary to the purpose of the rules.

These changes will require businesses to reassess their due-diligence and counterparty verification procedures.

If you are unsure whether your current due-diligence and counterparty checks provide adequate protection under the proposed changes, our firm can help. We review and adapt existing procedures and develop new measures to reduce the risk of joint and several liability for VAT not paid by an unreliable counterparty.

The provisions being considered by the Sejm and Senate are intended to take effect on 1 January 2027. The new liability rules would apply to services for which the tax obligation arises from that date.

This information does not constitute a legal opinion. For further information or legal assistance, please contact our firm: 42 207 66 66, kancelaria@krs-adwokaci.pl.

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