On 2 December 2026, the Court of Justice of the European Union ruled that the right to deduct VAT arises when a taxable transaction occurs, not when the invoice is received. The decision invalidates Polish rules that tie VAT deduction to invoice receipt, allowing businesses to claim VAT earlier if the invoice is received before the tax return deadline. The ruling is expected to improve cash flow for companies across the EU.
The court held that the right to deduct VAT arises when the taxable transaction occurs, not when the invoice is received.
Polish regulations that tie VAT deduction to invoice receipt are incompatible with the EU VAT Directive, allowing companies to deduct VAT earlier if the invoice is received before the tax return deadline.
The ruling may improve cash flow by allowing companies to deduct VAT earlier, reducing the need to finance the state budget from their own funds for several weeks.
The ruling is EU-wide, affecting all EU member states, but it specifically addressed Polish regulations.
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MDDP · about 18 hours ago
The General Court ruled that Poland’s requirement of invoice possession for VAT deduction is incompatible with EU law. Polish taxpayers can now deduct VAT in the month of liability if the invoice was issued before the tax return submission, rather than waiting for the next accounting period. The decision is expected to accelerate VAT recovery and improve cash flow, especially under the mandatory KSeF e‑invoicing system.
Crowe Poland · 1 day ago
Crowe Poland outlines draft amendments to Poland's VAT regime scheduled to take effect July 2026. Key changes include a VAT warehouse system, removal of duplicate inventory reporting, elimination of reporting for tax‑exempt purchases, and repeal of the 14‑day VAT payment rule for intra‑Community transport acquisitions. The amendments aim to simplify compliance and reduce VAT evasion risk.
VatCalc · 9 days ago
Poland’s Ministry of Finance clarified that non‑resident businesses are subject to KSeF e‑invoicing only if they have a Polish fixed establishment (SMPD/FE) that participates in the specific supply. The rule, effective 1 February 2026, does not trigger on a Polish VAT registration alone and requires a full assessment of the fixed establishment’s involvement per transaction.
VatCalc · 9 days ago
Poland is set to roll back its Mandatory Disclosure Rules and simplify VAT compliance from 1 October 2026, while tightening enforcement through new limitation rules and faster overpayment recovery. The third‑party liability threshold will rise to PLN 5,000 and authorities may remit tax before the due date or determine property tax liabilities from existing data. These changes aim to reduce administrative burden and enhance enforcement against VAT abuse.
Global VAT Compliance · 10 days ago
Poland has submitted a draft digital services tax to the legislative programme. The proposal would levy a 3% compensatory tax on digital services in Poland, applying to entities with global revenue over EUR 1 billion and Polish taxable revenue over PLN 25 million. Public consultations are set to start 2 Feb 2026, with no implementation date yet announced.
The Invoicing Hub · 12 days ago
Poland has made B2B e‑invoicing mandatory with the launch of KSeF 2.0 on 1 February 2026. Large firms (turnover > PLN 200 million) must use the new platform, while the previous KSeF 1.0 and MCU are shut down. The mandate will extend to all other VAT‑registered businesses on 1 April 2026, with micro‑entrepreneurs exempt until 1 January 2027.
