DGP: VAT on lunches comes and goes. Parents are confused again
They get a bill with tax for one child and without tax for another. It happens that both here and there there is a catering company. It is not surprising, therefore, that questions about payments still abound, writes Dziennik Gazeta Prawna.
Asked by the newspaper for a comment, Andrzej Kapczuk, tax adviser and partner at Thedy & Partners, pointed out that the sale of meals at schools remains outside the scope of VAT taxation by the school/municipality. Both in terms of sales to pupils, teachers and school administration staff. It took a while for this approach to become established across Poland. It was confirmed, for example, by the NSA judgment I FSK 1248/17 of October 2019. In fact, there was already another NSA judgment in 2008 indicating the provision of lunches to pupils as part of educational services (although then defined as “exempt from VAT”).
However, for many years the tax authorities have been promoting the thesis that the sale of meals is subject to VAT at the rate of 7%/8%, or alternatively they are exempt from VAT.
Today there is practically a uniform line of jurisprudence in this respect. However, the lack of VAT charged by the school/municipality does not mean, of course, that parents paying for meals for their children do not bear the burden of VAT. The school, charging them for the so-called “input to the boiler” (according to Article 106 of the Act on Education Law) must include in the price both the net amount of food purchased and the amount of VAT included in the gross price (because this VAT is not deductible for the school / municipality).
Therefore, if meals are prepared in the school canteen, VAT (although invisible at first glance in the “school – parent” relationship) is actually hidden in the price, but only of the food products used to prepare the meals. “Boiler-feed” does not include, according to the law, the cost of canteen staff salaries or other costs related to the maintenance of canteens.
On the other hand, if the meals served in the school canteen are prepared by external catering companies – the situation may look a bit different, although here there are various scenarios of cooperation with such a company. If it is the school that purchases meals from the company and, as it were, resells them “at cost”, VAT on such sales in the “school – parent” relationship is, as a rule, also absent, but, at the same time, the school does not deduct VAT charged on purchases from the catering company. Therefore, the school also includes non-deductible VAT in the price of the meal. However, there is another (non-tax) issue at stake here, namely the method of calculating the meal fee.
The entire article was published in Dziennik Gazeta Prawna of 20 October 2021, page D1