With a one-year delay in relation to the obligation imposed by European Community legislation (i.e. 1 January 2021) Poland intends to introduce some elements of the so-called “quick fixes” VAT package, resulting from the implementation of the Directive 2018/1910. The solution that may prove surprisingly beneficial for foreign traders in Poland is the introduction of EU regulation with regard to call-off warehouses stock in place of functioning so far consignment warehouses.
The essence of the regulation
In general, consignment warehouses and call-off stocks are the same institution, since by introducing the former in the Polish regulations, the legislator based that solution on the general principles of creating call-off stocks, although in terms of some legal consequences different solutions were chosen than those adopted in the later directive 2018/1910.
The approach of the Polish legislator was correct, but also caused consignment warehouses not to be very popular.
The common substance for both varieties of those warehouses is that, by transferring the goods within intra-Community transactions into Poland, into such a warehouse, it is possible to postpone the time when the intra-Community acquisition of the goods is to be identified until the goods are taken from storage. In other words, the stock call-off warehouse in intra-Community trade is the equivalent of a customs warehouse.
Functional assumptions of the consigning composition
In terms of the important solutions adopted in the introduction of consignment warehouses, it was assumed:
– a maximum retention period of 24 months,
– the accounting for the intra-Community acquisition of goods by their purchaser collecting goods from storage,
– the goods delivered to the warehouse are intended exclusively for one purchaser and solely for the purposes of his production or service activities,
– the supplier (value added tax taxable person) is not registered in Poland as a VAT taxpayer.
Differences and new rules – call-off stock magazine
Since the substance of the institution will not change, the amendment generally affects only certain legal effects. Directive 2018/1910 took over partly different solutions, which before its adoption were applied in some Member States which had previously, like Poland, introduced call-off stock warehouses voluntarily.
The following elements will therefore change:
– the period of storage of the goods in the warehouse will be reduced to 12 months,
– the goods may also be used for trading purposes,
– the foreign supplier could be in many cases be obliged to settle the intra-Community acquisition in Poland and, as a result,
– the buyer of the goods or the entity that replaces it settles intra-Community acquisition only in some cases,
– not only can, but also should register for VAT purposes in Poland.
Assessment of changes and benefits
Reducing the shelf-life of goods by half may be considered a change to the detriment, but it seems that the benefits of further changes can compensate for this.
In terms of benefits for foreign taxpayers, first of all, attention should be paid to the introduction of the possibility of collecting goods also for trading activities. This option may be of particular interest to entities delivering finished goods to Poland, including those running mail-order sales (who would exceed limits ), in terms of the postponement of the tax liability. An additional benefit is also the change of the settlement method.
Although, until now, the intra-Community acquisition of goods has been accounted for by the purchaser in Poland and therefore considered as so called transactional, from 1 January 2021 it will be an internal transaction: that is to say, both the supply (in the country of dispatch) and the acquisition (in Poland). This, of course, raises the need to register in Poland (but this still happens so often), but it also gives great opportunities to control the existence of tax liability, the management of goods, etc.
As regards the new rules, it is worth adding that the operation of the call-off stock warehouse requires notification within 14 days from the date of the first entry into the warehouse in this procedure, also under criminal penalty (of a fine).