Intra-Community Supply Without the Buyer’s VAT-EU Number – Good Faith May Still Preserve the 0% VAT Rate

The Provincial Administrative Court in Wrocław (case no. I SA/Wr 210/26) confirmed that the absence of a valid VAT-EU number for the buyer at the time of delivery generally excludes the application of the 0% VAT rate to an intra-Community supply of goods (ICS).

At the same time, the Court highlighted two key points:

• a taxpayer may still retain the right to the 0% rate if it acted in good faith and with due diligence,
• an assessment of these circumstances is only possible in the course of a tax audit or tax proceedings – not within an individual tax ruling.

“This judgment fits into an already established line of case law, under which the formal conditions of an intra-Community supply cannot automatically override the right to the 0% rate if the taxpayer genuinely exercised due diligence in verifying its counterparty. The problem is that tax authorities still remain reluctant to assess good faith at the stage of an individual ruling, which forces taxpayers to litigate the issue only once an audit is underway,” comments Andrzej Kapczuk, tax advisor, partner at Thedy & Partners.

In practice, this means that:

• a formal lack of a VAT-EU number creates, among other things, the risk of having to apply the domestic VAT rate to the supply and to make subsequent corrections,
• in any potential dispute, what matters most is demonstrating that the taxpayer properly verified its counterparty (e.g. through the VIES system) and exercised due diligence.

Key takeaway

Meeting the substantive conditions for an intra-Community supply is essential, but in practice, demonstrating good faith and due diligence may prove decisive. It is therefore worth:

• archiving VIES confirmations,
• maintaining complete intra-Community supply documentation,
• implementing practical counterparty verification procedures.