White List of taxpayers - what are the consequences for entrepreneurs?
On September 1, 2019, the law introducing an electronic list of active VAT payers (the so-called white list of taxpayers) entered into force. Therefore, entrepreneurs will be able to use it to find information about their contractors, including registration, deregistration and VAT taxpayer status, as well as their bank account numbers. Importantly, the introduction of a white list of taxpayers will have consequences for entrepreneurs in terms of PIT and joint and several liability. Let's check how it is possible to avoid negative consequences and how to verify contractors.
White list of taxpayers - let's start with the theory.
Pursuant to Art. 96b paragraph. 1 of the VAT Act, the head of KAS will be obliged to keep an electronic list of entities in relation to which the head of the tax office has not registered or deleted from the register as VAT taxpayers and entities that are registered as VAT taxpayers, including those whose registration as VAT taxpayers has been restored.
This list is available in the public bulletin of the Ministry of Finance.
White list of taxpayers - what are the consequences for taxpayers?
Consequences in income tax.
The white list of taxpayers is to facilitate the verification of contractors so that the entrepreneur does not take part in transactions with disappearing VAT payers. However, in addition to facilitating the verification of the contractor, the legislator imposes an obligation on taxpayers to verify whether the seller's bank account number complies with the white list and indicates that the buyer should pay the amount due only to such an account. It should be emphasized that this obligation arises only when:
- one-time transaction value, regardless of the number of resulting payments, exceeds PLN 15 000 or the equivalent of this amount, where transactions in foreign currencies are converted into zlotys according to the average exchange rate of foreign currencies announced by the National Bank of Poland on the last business day preceding the transaction date.
- the seller is an active VAT payer.
The bank account verification should take place on the day on which the transfer order is planned. Therefore, the payment recommended by the taxpayer under the above-mentioned conditions should always be made to the seller's bank account included in the list. If not - the buyer will not be entitled to include the cost in the tax records and thus to reduce the value of the income (Article 22p (1) (2) of the amendment to the PIT Act).
The obligatory verification of the bank account will only apply from January 1, 2020, so from this period there will be consequences for the taxpayer in terms of PIT and joint and several liability.
In the case of including the cost of tax deductible costs (documenting a transaction above or equal to PLN 15 thousand, acquired from an active VAT taxpayer), which has been paid to a bank account not included in the list:
- reduce tax deductible costs, either
- if it is impossible to reduce tax deductible costs - increase revenues
in the month in which the transfer was properly ordered.
The right to recognize the expenditure as tax deductible costs is restored when the buyer submits a notification containing:
1) identification number, company (name) and address of the registered office or, in the case of a taxpayer who is a natural person, name and surname and address of a permanent place of business, and in the case of no permanent place of business - the address of the place of residence of the taxpayer making the payment;
2) details of the invoice issuer indicated on the invoice (identification number, name or first and last name and address);
3) the number of the account to which the payment was made;
4) the amount of the payment made by bank transfer to the account referred to in point 3 and the date of ordering the transfer to that account.
to the head of the tax office competent for the issuer of the invoice within three working days from the date of ordering the transfer.
Example 1.
Marek, an entrepreneur, purchased goods worth PLN 16,000 from ABC. gross zlotys. The purchase was documented by an invoice (deferred payment date - 30 days, issue date: January 2, 2020). The cost was included in the KPiR in January. Mr. Marek ordered the transfer on February 17, 2020. Unfortunately, after making the transfer, he realized that he had not checked his bank account on the list. After catching up (February 20, 2020), it turned out that the bank account was not on the list. Due to the fact that 3 working days have passed from the date of ordering the transfer, Mr. Marek will not be able to submit a notification to the office. In February 2020 it will be necessary to:
- reducing tax deductible costs either
- if it is not possible to reduce tax deductible costs - increase in revenues.
Example 2.
Ms. Monika runs a sole proprietorship and on February 3 she purchased the machine for resale. The gross value of the machine is 20 thousand. zlotys. She received an invoice for this - deferred payment date: 30 days, date of issue: March 3, 2020. The cost was included in the KPiR in February. Ms. Monika ordered the transfer on February 17, 2020. Unfortunately, after making the transfer, she quickly realized that she had not checked her bank account on the list. Immediately on the day that she ordered the transfer, she checked that the bank account was not on the list. Therefore, Ms. Monika has 3 working days from the date of ordering the transfer to submit notifications to the tax office of the relevant seller and avoid the cost being written off.
A situation in which, as a rule, the buyer will always be obliged to submit a notification to the tax office, will be that the seller only has a private account. This is because RoR accounts are not included in the inventory.
Sanctions - joint and several liability
If the buyer makes a payment to another account (not shown in the list) and the seller does not pay VAT on this transaction to the tax office, he will be jointly and severally liable for it together with the seller, up to the amount of the tax liability for the transaction.
Importantly, you can protect yourself against the above sanction in two ways:
if no later than 3 days from making the transfer to the wrong bank account number, notification of this fact is made to the head of the tax office competent for the seller;
the taxpayer paid for the receivable using the split payment mechanism.
Payments ordered to an account other than the one specified in the list by December 31, 2019 are not subject to sanctions.
Example 3.
The entrepreneur bought a passenger car for PLN 16,000. gross zlotys and paid the entire amount by transfer to a bank account that was not included in the list of taxpayers. The seller did not settle VAT on this sale. The tax office will be able to report to the buyer for overdue VAT. The exception will be when the buyer voluntarily pays for the transaction using the split payment method or makes a notification of the transfer to a bank account not included in the list to the seller's tax office within 3 working days (from the transfer). Then the buyer will not be responsible for VAT not regulated by the seller.
The Ministry of Finance did not anticipate a few problems that may arise in connection with the introduction of the white list of taxpayers. A few of them and their solutions are presented in the table below:
Doubts related to the white list of taxpayers
| Unable to identify the bill when paying with a debit or credit card | The legislator indicates that by the end of 2019 it will adapt the regulations (i.e. before the regulations that provide for negative consequences for taxpayers enter into force). |
| Payments to foreign contractors | If the foreign contractor is not registered in Poland as an active VAT payer, the introduced provisions will not apply to payments to him. |
| Payment through an intermediary | In the case of payment via an intermediary, the buyer only verifies his bank account - whether it is included in the list. If it is, then the buyer will not be burdened with the consequences when the broker pays the amount due to the seller's account not included in the list (then the broker himself bears the consequences). |
The Ministry of Finance indicates that tax clarifications will be issued regarding the provisions on the white list. So they will probably solve all doubts about the whitelist. They will most likely be published in the fall.
How to verify contractors on the white list of taxpayers?
To check the status of his contractor, the entrepreneur will be able to use one of two ways:
1) use external programs provided by software producers that connect to the API provided by the Ministry of Finance. The aforementioned software may be able to be whitelisted in the method:
- search - is completed with one information about the counterparty (eg NIP, fragment of name, REGON or bank account number) and the day on which information about the entity is to be displayed. Then, in response, the taxpayer will receive:
- the entire scope of data from the list of entities in the inquiry,
- unique identifier - an electronic key which confirms the execution of the inquiry (which entity's identifier was asked for, the date on which the answer was given and the date of the inquiry
2. check - three information is completed (NIP, REGON, bank account number and date, i.e. the date on which the verification is to be carried out), and in response the taxpayer will receive the information:
- YES or NO - which mean that a given account is assigned (or not) to a specified entity number (on DATE),
- an electronic key that confirms the execution of the inquiry (which entity identifier was asked for, the date on which the answer was given and the date of submitting the inquiry).
At the end of August, the Ministry of Finance published a test API, with the help of which software producers, e.g. accounting software, could create a working integration with the white list of VAT taxpayers. It was an extremely short period of time to bring the integration into effect until the legislation entered into force. Importantly, the use of the API is limited - the taxpayer may use the API to query a maximum of 30 entities at the same time (which gives a total of 300 entities). If the daily limit is exhausted, access will be blocked until 00:00.
In addition, the ficus wanted to provide information on the settlement accounts of VAT payers to financial institutions - banks and credit unions - to enable them to create a tool by which the entrepreneur could automatically verify, when ordering a transfer, whether he makes a payment for a bank account on the white list of taxpayers. Unfortunately, it depends on banking institutions whether they implement this solution in their system or not and make this solution available to entrepreneurs.
Unfortunately, some financial institutions report that "Banks are not obliged to provide clients with solutions related to the verification of the white list of bills used when paying for VAT invoices. The risk and responsibility for the fact that the recipient's account is on the white list as at the date of the ordered transfer is borne solely by the taxpayer."
White List of taxpayers - how to prepare for it?
The entrepreneur (acting as a buyer), in order not to be exposed to negative consequences resulting from failure to check his contractor or despite verifying the transfer to a bank account that is not on the list, should first of all:
- after December 31, 2019, check the bank accounts of contractors with whom transactions are concluded above or equal to 15 thousand zlotys. Especially those with whom cooperation is established for the first time,
- if the account is not listed, you should clarify this with your counterparty right away before making the payment.
For sellers who accept payments over 15,000 PLN, they should check their data on the white list of taxpayers, in particular those reported to the tax office (in the case of a company registered in the National Court Register) or via CEIDG (in the case of sole proprietorship) bank account numbers. For the lack of a bill or an incorrect bill, the seller will expose buyers to sanctions, which may adversely affect its credibility on the market.
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