VAT-EU for care services abroad - sale and import of services — in Poland

Cooperation of a Polish care company with a foreign agency may involve two opposite transactions:

1. You provide a service to the agency - this is selling a service.
2. The agency provides an intermediation service for you and collects a commission - this is a purchase that may constitute the import of services.

These situations cannot be accounted for in the same way. The mere fact that the transfer comes from Germany or the invoice is issued without VAT does not determine the type of transaction.

Check the contract first

Determine:

• who is the service provider and who is the service recipient,
• who pays whom?
• does the agency buy care services from you,
• is the agency just an intermediary and issues you an invoice for the commission,
• who is the actual recipient of care,
• where the care is provided,
• whether the contractor runs a business and has an active EU VAT number.

One contract can cover both directions: your sale of care and the purchase of an intermediation service.

When you issue an invoice to a foreign agency

If a German agency is a taxpayer and purchases a B2B service from a Polish JDG, the place of supply must be determined. For many services, the general rule from Art. 28b of the VAT Act - the place of taxation is the buyer's country.

In this variant, the Polish service provider usually:

• registers for VAT-EU before providing the first service covered by the obligation,
• issues an invoice without Polish VAT with the appropriate annotation if the conditions are met,
• shows the service in the VAT-EU summary information,
• records the transaction in the appropriate records or declarations in accordance with its VAT status.

This is selling a service, not importing services on the Polish company's side.

Not every care-related service automatically falls under Art. 28b. The actual nature of the benefit and the status of the recipient may be important.

When a foreign agency charges a commission

If the agency provides you with an intermediation service, advertising, platform access or other B2B service, services may be imported on the Polish side of JDG.

Then the Polish buyer:

• settles VAT due according to the rules for the import of services,
• before purchasing the service, you may be required to register for VAT-EU,
• submits the appropriate settlement document depending on the VAT status.

An active VAT taxpayer usually settles imports in JPK_V7. A taxpayer benefiting from VAT exemption may be required to submit VAT-9M and pay the tax.

VAT-9M does not always give a zero result

A VAT-exempt taxpayer cannot automatically deduct VAT due on the import of services. The right to deduct depends on the connection between the purchase and taxable activities and the fulfillment of other conditions.

If the commission is used exclusively for VAT-exempt activities, it is generally not deductible. The VAT due shown in VAT-9M may therefore be the actual amount payable.

VAT-9M is submitted for the period in which the obligation to settle the relevant transaction arose. This is not a "zero" declaration submitted every month just because the company has a VAT-EU number.

VAT-EU summary information

The VAT-EU summary information is not intended to show every import of services.

A Polish service provider may list services provided to an EU taxpayer for which tax is settled by the buyer if the statutory conditions are met. The purchase of a commission from a foreign agency is not reported as such a sale.

VAT-EU information is submitted electronically on a monthly basis. Old guides describing quarterly VAT-EU information are out of date.

Registration via VAT-R

Registration for intra-Community transactions is made on the VAT-R form. The appropriate part of the form depends on whether the trader:

• provides services for EU taxpayers,
• purchases services to which Art. 28b,
• performs WDT or WNT,
• is an active VAT payer or benefits from exemption.

VAT-EU registration itself does not mean the automatic loss of subjective or objective exemption for domestic sales.

The exemption for care services is not automatic

Not every service called "senior care" is exempt from Art. 43 of the VAT Act. The following are important, among others:

• the exact scope of the service,
• entity providing the service,
• recipient status,
• place of performance,
• the provision constituting the basis for the exemption.

You should not start your VAT-EU analysis with the assumption that every care company is exempt from VAT without any limit.

Interpretation regarding Booking.com

An individual interpretation regarding the commission of a foreign booking portal may confirm the import of the intermediation service by the owner of the facility. However, it does not prove that the remuneration paid to the caregiver by a foreign agency constitutes an import of services.

In the first case, the Polish company purchases the platform service. In the second, it can sell its own service to the agency. The direction of benefit is the opposite.

An individual interpretation protects only its addressee and only when the actual situation is consistent with that described in the application.

Example 1: selling care to an agency

Polish JDG provides a service for a German agency. The agency pays the Polish company EUR 3,000.

This is the revenue of the Polish JDG from the sale of the service. If Art. 28b, the invoice may be issued without Polish VAT, and the transaction may be subject to reporting in VAT-EU. This is not an import of services on the part of the Polish company.

Example 2: agency commission

Polska JDG receives an invoice from the agency for EUR 300 for the intermediation.

This is a purchase of a service. If the place of performance is determined according to Art. 28b, the Polish company settles the import of services. When exempt from VAT, VAT-9M may occur and tax must be paid without the right to deduct.

The most common mistakes

Recognition of each payment from the agency as an import

Import occurs when a Polish company purchases a service. The payment you receive for your own service is a sale.

NIP-7 instead of VAT-R

VAT-R is used for VAT-EU registration. NIP-7 does not replace this notification.

VAT deduction in VAT-9M by an exempt taxpayer

VAT-9M does not automatically create the right to deduct. In the case of exempt activities, import tax may be an economic cost.

Quarterly VAT-EU information

Summary information is submitted monthly, electronically.

Confusing reverse charge with self-invoicing

Reverse charge indicates who settles VAT. Self-billing means that the buyer issues an invoice on behalf of the seller. These are separate mechanisms.

What to check before the first invoice

1. The contract and the actual flow of services.
2. Counterparty status in VIES.
3. Place of supply of each service.
4. The basis for any possible release of custody.
5. VAT-R and VAT-EU obligations.
6. Whether the transaction goes to JPK_V7, VAT-9M or VAT-EU information.
7. Is there a right to deduct VAT from imported commission?

Sources

• Podatki.gov.pl - Intra-Community transactions and VAT-EU
• Biznes.gov.pl - VAT-EU registration
• Podatki.gov.pl - VAT-9M form
• VAT Act: art. 28b, 43, 86, 97, 99 and 100

Need to check your contract with an agency?

I provide accounting for JDGs cooperating abroad - from PLN 49 + VAT per month. Before the first settlement, we determine the sale of services and the purchase of commissions separately.

Reply to [email protected] or visit oxyok.com/pl.

Note: The result depends on the contract and the actual course of the transaction. The name "care agency" itself does not mean the import of services or VAT exemption.