RR VAT invoice - how to issue a corrective invoice?

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An active VAT payer who purchases agricultural products and agricultural services from flat-rate farmers issues VAT invoices himself. Invoices issued to flat-rate farmers differ significantly from the so-called regular invoices. What elements should a VAT RR invoice contain?

Agricultural activity in the light of the VAT Act

Agricultural activity is defined in Art. 2 point 15 of the Act of March 11, 2004 on tax on goods and services (i.e. Journal of Laws of 2017, item 1221, as amended), hereinafter referred to as the VAT Act, according to which agricultural activity is understood as plant and animal production, including the production of seed, nursery, breeding and reproductive material, vegetable, field, greenhouse and foil production, production of ornamental plants, cultivated and orchard fungi, breeding, breeding and production of seed material for animals, birds and insects industrial or farm-type livestock production, fish and other aquatic organisms, as well as cultivation in greenhouses and heated foil tunnels, cultivation of mushrooms and their mycelium, cultivation of plants "in vitro", farm breeding and rearing of poultry for slaughter and laying, poultry hatcheries, breeding and rearing fur and laboratory animals, rearing and breeding earthworms, entomophages and silkworms, running apiaries and rearing and breeding other animals, a farm and the sale of forestry and hunting products, except for round timber from tropical trees (PKWiU 02.20.13.0) and bamboo (PKWiU ex 01.29.30.0), as well as the provision of agricultural services.

Taking into account the definition of economic activity contained in Art. 15 sec. 2 of the Value Added Tax Act, it should be considered that the agricultural activity referred to in Art. 2 clause 15 of the quoted act, falls within the concept of economic activity.

Principles of VAT settlement

Pursuant to Art. 116 sec. 1 of the VAT Act, a taxpayer registered as an active VAT payer who purchases agricultural products from a flat-rate farmer shall issue an invoice in two copies documenting the purchase of these products. The original invoice is handed over to the supplier.

Pursuant to Art. 116 sec. 6 of the VAT Act, the flat-rate tax refund increases the amount of the input tax referred to in art. 86 sec. 2, in the settlement for the billing period in which the payment was made, provided that:

  • the acquisition of agricultural products is related to a taxable supply;

  • the payment of amounts due for agricultural products, including the amount of the flat-rate tax refund, was made to the bank account of the flat-rate farmer no later than on the 14th day from the date of purchase, except when the farmer concluded an agreement with an entity purchasing agricultural products specifying a longer payment term;

  • the document confirming the payment of amounts due for agricultural products will include the number and date of issuing the invoice confirming the purchase of these products, or the invoice confirming the purchase of agricultural products provides the identification data of the document confirming the payment.

Pursuant to Art. 116 sec. 7 of the VAT Act, the date of payment shall be the date of issuing the bank instruction to transfer funds to the bank account of the flat-rate farmer, if the instruction has been fulfilled.

The provision of art. 116 sec. 8 of the VAT Act provides that the condition referred to in sec. 6, paragraph 2, applies to that part of the payment, which is the difference between the amount of the amount due for delivered agricultural products and the amount of the amount due for goods and services provided to the flat-rate farmer by the purchaser of these agricultural products.

Pursuant to Art. 116 sec. 9 of the VAT Act through receivables for goods and services provided to a flat-rate farmer, referred to in paragraph 8, also understood as deductions for repayment of loan installments and advances granted to a flat-rate farmer providing agricultural products, made by the taxpayer purchasing these products, provided that:

  • the advance payment was transferred to the bank account of the flat-rate farmer, and the invoice confirming the purchase of agricultural products contains the identification data of the document confirming the payment;

  • installments and loans result from contracts concluded in writing.

Pursuant to Art. 116 sec. 9a of the VAT Act, through the receivables for goods and services provided to the flat-rate farmer referred to in paragraph 8, it is also understood deductions, if they result from other laws, regulations of the Council of the EU or executive (enforcement) titles.

RR VAT Invoice - Items

Pursuant to Art. 116 sec. 2 of the VAT Act, the invoice documenting the purchase of agricultural products should be marked as VAT invoice RR and contain at least:

  • name and surname or name or short name of the supplier and buyer and their addresses;

  • tax identification number or PESEL number of the supplier and buyer;

  • the number of the supplier's identity card or other document confirming his identity, the date of issue of this document and the name of the authority that issued the document, if the flat-rate farmer delivering agricultural products is a natural person;

  • the date of purchase as well as the date of issue and the sequence number of the invoice;

  • the names of the agricultural products purchased;

  • unit of measure and quantity of agricultural products purchased and indication (description) of the class or quality of these products;

  • unit price of the purchased agricultural product without the amount of the flat-rate tax refund;

  • value of purchased agricultural products without the amount of the flat-rate tax refund;

  • flat rate tax refund;

  • the amount of the flat-rate tax reimbursement on the value of purchased agricultural products;

  • value of purchased agricultural products with the amount of the flat-rate tax refund;

  • the total amount due together with the flat-rate tax refund, expressed digitally and in words;

  • legible signatures of persons authorized to issue and receive invoices or signatures as well as the names and surnames of these persons.

According to Art. 116 sec. 3 of the VAT Act, the VAT RR invoice should also contain the declaration of the supplier of agricultural products as follows: I declare that I am a flat-rate farmer exempt from tax on goods and services pursuant to art. 43 sec. 1 point 3 of the Act on tax on goods and services.

Pursuant to Art. 116 sec. 4 of the VAT Act, in the case of cultivation contracts or other contracts of a similar nature, the declaration referred to in para. 3, may be submitted only once during the term of the contract. They are drawn up as a separate document. It should contain the elements referred to in para. 2 points 1-3, and the date of the conclusion and specification of the subject of the contract, the date of preparation of this document and a legible signature of the person submitting the declaration. The document is prepared in duplicate. The original is handed over to the buyer.

Pursuant to Art. 116 sec. 2 point 13 of the VAT Act, the invoice documenting the purchase of agricultural products should be marked as VAT invoice RR and contain at least legible signatures of persons authorized to issue and receive invoices or signatures and the names and surnames of these persons.

Correcting RR invoices

We correct VAT RR invoices in accordance with the provisions of art. 106j of the VAT Act. Indeed, it is often not possible to apply those provisions directly when correcting VAT RR invoices. This applies in particular to the provisions on the content of corrective invoices. Consequently, the corrective invoice should contain;

  • title Corrective invoice VAT RR,

  • consecutive number of the correcting invoice,

  • the date of issuing the correcting invoice,

  • data included in the VAT RR invoice to which the VAT RR correction invoice relates: name and surname of the supplier and buyer (short name), addresses; NIP or PESEL number of the supplier and buyer; Supplier's ID card number or other document confirming its identity, date of purchase and date of issue and invoice number, names of purchased agricultural products,

  • the reason for the correction,

  • the amount of the tax base correction and, if the amount of the flat-rate tax refund changes, the amount of the flat-rate tax refund correction.

Who issues the corrective invoice?

As mentioned above, VAT RR invoices are issued by buyers of agricultural products and agricultural services. Therefore, the buyers are also obliged to issue correcting VAT RR invoices. At this point, it should be remembered that the corrective invoice must be signed. In this case, the correcting invoice is signed by the flat-rate farmer. As a result of its issuance, the flat-rate tax refund may be increased. In this case, pursuant to art. 116 sec. 6 of the VAT Act, the above tax amount should be included in the VAT settlement for the settlement period in which the amount resulting from the correction was transferred to the farmer's account, i.e. not later than on the 14th day from the date of issuing the correcting invoice (the exception occurs when a contract is concluded with an entity purchasing agricultural products for a longer payment term).