What a VAT invoice must look like and what it should contain

What a VAT invoice must look like and what it should contain

What a VAT invoice must look like and what it should contain

Under Polish commercial law, a trader, before issuing a VAT invoice, has the option to issue a pro forma invoice. However, it should be remembered that it is not an accounting document – it does not prove that the transaction has been carried out, and therefore does not constitute the basis for payment. A pro forma invoice is treated as a confirmation of an offer to a counterparty or acceptance of an order for execution. If the order is actually executed, a VAT invoice should be issued for each pro forma.

Issuing correct VAT invoices is an essential activity for any business working to a payment deadline. It is an acknowledgement that a VAT-taxed transaction has taken place. It is crucial for VAT taxpayers as it is the basis for the deduction of input VAT.

In what period must a VAT invoice be issued

The general rules state that the taxpayer has until the 15th of each month that follows the month of sale to issue invoices. There are exceptions to this rule for:

  • construction services – the invoice must be issued by the 30th day after the services have been rendered at the latest.
  • activities related to the printing of books, among others. We issue the invoice then no later than on the 90th day after the performance of the service.
  • the supply of, inter alia, printed books, in which case the invoice is also issued no later than on the 90th day after the services have been rendered.
  • supply of, inter alia, electricity and heat as well as provision of telecommunication, rental or permanent legal services, mentioned in art. 19a, subsection 5, item 4. In such situation, the invoice is issued no later than on the due date.

What is more, there is an obligation to issue an invoice at the request of the buyer of goods or services, if the request is made within three months, counting from the last day of the month in which the goods or services were delivered or part or all of the payment was received.

What a VAT invoice should contain

  • Date of issue – That is, the date on which the invoice was issued
  • Sequential number – Given in a series specified by the trader. Each invoice must have a number that makes it easy to identify the invoice and its sequence in the series
  • Names of the taxable person and the buyer of the goods or services and addresses – Identifies the parties of the buyer and the seller. This is an obvious and also very important element, as it is the basis for identifying each party in the event of a dispute, for example
  • TIN – Be sure to include the Taxpayer Identification Number. The TIN of the purchaser should also be specified. In the case of natural persons, it may be PESEL
  • Date on which the supply of goods or services was made or completed – This can also be the date on which the payment was received, as it is often the case that the invoice is issued before the services / goods have been fully provided. In this case, both dates – the issuing of the invoice and the delivery of the goods / services – should be included.
  • Name of goods or services – The correct invoice should clearly state what is being transacted
  • Number / extent of goods / services – The number (measure) of goods sold or extent of services should be stated. Presented e.g. in time or a specific product, e.g. making a website
  • Unit price of the goods or service (net) – Specify the price of the goods or service (per 1 item), without VAT added. Here, you should also specify any discounts, if any.
  • Value of goods or services – The total value of sales of goods or services after adding them up.
  • Tax rate – Specify the rate of tax on which we operate in order to add the tax due. If we are operating at several rates, each good or service should have a list of tax rates to be charged.
  • Tax amount – Chargeable on the sum of net sales, taking into account the different tax rates.
  • Total amount due – The sum of the net amount and the taxes charged.

The elements that have been listed are mandatory elements that must appear on every invoice. There are also other elements that, in certain cases, must be included on a correct invoice. All cases are covered in the Value Added Tax Act.

Additional elements of a VAT invoice

VAT invoices under Article 106e(1) of the VAT Act should also include such information as:

  • self-invoicing – where the buyer of goods or services issues the invoice on behalf of the seller.
  • cash method – in a situation where goods or services are delivered and the obligation to pay arises at the moment of receiving the whole or part of the payment.
  • reverse charge – in a situation when goods or services are supplied or rendered for which the obligation to settle VAT, or a tax of a similar nature, is imposed on the buyer of the goods or services.
  • the margin scheme for travel agents – in the case of tourist services where the taxable amount is the margin.