The Ministry of Finance is working on clarifications for VAT groups

The published document runs to 43 pages. In it, the Ministry explains, among other things, the idea of VAT groups, the conditions for the creation of groups, explains what exactly economic, financial and organisational links are, and presents a links test. The explanations also include a section on the signing of the VAT group agreement and its registration. However, the chapters on VAT group accounting, e.g. input tax and VAT pro rata deduction, cross-border transactions, invoicing rules, record keeping or obligatory reporting, seem to be of key importance. The explanatory notes also contain a section on the operation of the VAT group within the tax procedure (tax proceedings and audits), the protection available in respect of individual interpretations and the possibility of obtaining a WIS. The document ends with chapters on the extension of the operation of VAT groups and their termination.

– When analysing the ministerial draft of the explanations, it must be emphasised that the MF focuses on the practical explanation of the regulations relating to the creation and functioning of a new type of taxpayer, i.e. a VAT group. In the consulted draft, emphasis has been placed on the practical presentation, together with providing examples, of the understanding of the provisions of the VAT Act to the extent in which they allow joint VAT settlements by several entities within VAT groups – states Łukasz Woźniak, VAT Manager at Thedy & Partners.

Recall that VAT groups will be possible for taxpayers to form from 1 January 2023.