Taxpayer! You are required to submit a zero VAT return
Entrepreneurs subject to the obligation to settle the tax on goods and services are well aware of the fact that taxable transactions must be shown in the VAT declaration. This obligation is imposed on taxpayers, with the exception of those benefiting from tax exemptions under the Act of March 11, 2004 on tax on goods and services. However, what if such a person did not perform any operations in a given settlement period, which resulted in a zero declaration made? In accordance with applicable law, zero VAT returns must also be submitted to the tax office.
Obligation to submit VAT returns
As a rule, VAT payers defined in Art. 15 above of the Act, are obliged to submit settlement declarations to the tax office by the 25th day of the month following each subsequent month (VAT-7 declaration). However, as it follows from Art. 99 sec. 2 of the Act, small taxpayers who pay by the cash method submit a tax return (VAT-7K) by the 25th day of the month following each quarter of the tax year. The quarterly settlement may also be used by other taxpayers who do not pay by the cash method, after prior written notification to the head of the competent tax office, not later than on the 25th day of the second month of the quarter for which the tax declaration will be submitted for the first time.
The above-mentioned obligation to submit a VAT declaration does not apply to taxpayers who have been exempted from the tax on goods and services pursuant to Art. 113 and entities performing activities exclusively exempt from taxation.
This obligation also does not apply to persons who have suspended their business activities on the basis of different provisions. Only the periods to which the suspension relates are released. However, the legislator provided for certain exceptions to which the exemption from submitting declarations for such taxpayers does not apply. Pursuant to Art. 99 sec. 7b, this exemption does not apply to:
- taxpayers making intra-Community acquisitions of goods,
- taxpayers importing services or purchasing goods,
- the settlement period, the suspension of which did not cover the entirety,
- the accounting period for which the taxpayer is obliged to settle the tax on the performance of taxable activities and for which he is obliged to correct the input tax.
Due to the above, each VAT payer who has not been exempted under the aforementioned regulations from submitting a settlement declaration (VAT-7, VAT-7K, VAT-7D) must comply with the statutory deadlines. What, however, if the taxpayer has not made any taxable transactions in a given period and does not submit a zero form to the tax office?
Consequences of not submitting a VAT return
In order to be able to find out about the consequences for the taxpayer for failure to submit a tax declaration, it is necessary to read the provisions of the Act of September 10, 1999, the Penal Fiscal Code. Pursuant to Art. 54 a taxpayer who, avoiding taxation, does not disclose to the competent authority the subject matter or the tax base, or does not submit a declaration (exposing the tax to depletion), shall be subject to a fine of up to 720 daily rates or imprisonment, or both. However, if the amount of the tax subject to depletion is of low value, the perpetrator of the abovementioned offense is only subject to a fine of up to 720 daily rates. If the amount of the tax subject to depletion does not exceed the statutory threshold, the taxpayer is subject to a fine for a fiscal offense, the threshold being the amount of five times the minimum wage at the time of its commission.
It is worth quoting the provision from the preliminary provisions of the Code, in particular Art. 1 § 2, which shows that it is not a crime or a tax offense, a prohibited act, if its social harmfulness is negligible.
Referring the above provisions to the actual state of not submitting a zero VAT declaration by a taxpayer, it can be concluded that such a person does not evade taxation or hide the subject or basis of this taxation. This is because the tax obligation did not arise at all. Therefore, by not submitting an "empty" settlement form, it does not expose VAT to depletion, and thus, such an act can be considered as having negligible social harm. Therefore, in accordance with the above considerations, in relation to a taxpayer obliged under the VAT Act to submit a settlement declaration, even the zero one, no consequences resulting from the Fiscal Penal Code should be drawn.
According to the Ministry of Finance
In response to a question from one of the MPs in the questioning no. 18890 of 2013, whether it is possible to waive the obligation to submit a "zero" declaration when the taxpayer has not shown any tax, the Undersecretary of State specified: Referring to the issues raised in the interpellation, (...) including the so-called zero declarations, is of significant importance from the point of view of ongoing monitoring of taxpayers of value added tax. (...) Taking into account the specificity of the tax on goods and services and the fact that this tax is exposed to various types of abuse (...), such monitoring of taxpayers carried out on the basis of submitted declarations (...) is necessary. It allows for faster detection of dishonest taxpayers, which is very important from the point of view of securing revenues from this tax, which are the largest source of state budget revenues. (...) Considering the above, and in particular the protection of public finances, it is not possible to waive the obligation to submit zero declarations by taxpayers of value added tax.
As can be seen from the above statement, the obligation to submit “zero” declarations is not expected to be abolished in order to protect the interest of VAT. Therefore, taxpayers who have committed such an act can only count on non-application of the penal fiscal consequences to them.