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What is subject to VAT?

14 Jan 2015

Certain cases and settlements have amended what is exempt from VAT. Taxand Poland takes a look at the exceptions most likely to affect businesses operating in Poland.

Deposit refunded after execution of the contract is not subject to VAT

  • A deposit, refunded after proper execution of the contract by the contractor, has a guarantee rather than a price-determining nature. Such a benefit does not constitute a supply of goods or services and therefore is not subject to VAT.

Remuneration in the form of real estate for the compulsory redemption of shares is not subject to VAT

  • Acquisition of own shares for the purpose of the compulsory redemption is not a supply of goods or rendering services within the meaning of the VAT Act and does not fulfill the conditions of the definition of business activity. Thus, the remuneration paid for the redeemed shares is not subject to VAT.

Discover more: Recent Polish tax updates

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Andrzej Puncewicz
T. +48 22 324 59 49

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Taxand's Take

These exemptions may influence multinationals operating within a variety of sectors. Companies operating in Poland should take note and respond accordingly.

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