The STIR Act - a new way to tighten the VAT system

Service-Tax

The introduced STIR Act of November 24, 2017 allows, from April 30, 2018, under certain conditions, the Head of the National Revenue Administration to block taxpayers' bank accounts. In this article, we explain why the STIR Act was created, when a bank account is blocked and how to appeal against it. Read on!

The Act on STIR - the purpose of its introduction

On December 28, 2017, the Act amending certain acts to counteract the use of the financial sector for fiscal fraud was signed, which introduces the Teleinformation System of the Clearing House (STIR) after 4 months from the date of publication of the act (i.e. April 30, 2018).

The main purpose of STIR is to reduce the VAT gap and to fight against VAT carousels. This is to be done by sending information about bank accounts opened and maintained for qualified entities and about any transactions understood as crediting or debiting carried out through these accounts between the systems of banks and credit unions and the tax administration. The information collected by the tax administration is to be analyzed for the risk of using the activities of banks and credit unions for purposes related to fiscal fraud. This analysis is performed on the basis of algorithms developed by the clearing house, taking into account the best practices of the banking sector and credit unions in the field of counteracting the use of their activities for crimes and fiscal crimes. Economic, geographic, subject, behavioral and linkage criteria are also taken into account.

Important!

The definition of a qualified entity is regulated by the STIR Act, in which we can read that a qualified entity is:

  1. a natural person who is an entrepreneur within the meaning of Art. 4 sec. 1 of the Act of July 2, 2004 on the freedom of economic activity,

  2. a natural person engaged in gainful activity on their own account, who is not an entrepreneur within the meaning of the Act referred to in point (a). and,

  3. legal person,

  4. an organizational unit without legal personality, which the law recognizes as having legal capacity.

As a result, the conducted analyzes will allow the Head of the National Revenue Administration (KAS) to take appropriate actions, e.g. blocking an account of a qualified entity, in which the system has detected a high risk of committing a fiscal offense. The conducted analyzes will also make it possible to identify bank accounts that were opened solely for the purpose of committing a fiscal offense (the so-called poles). The STIR Act will be one of the most important tools of the National Revenue Administration in the VAT sealing system, together with SAF-T and split payment.

Blockade of bank accounts under the STIR Act

As mentioned in the previous paragraph, if the Head of the National Revenue Administration obtains, as a result of the risk analysis, the information that a qualified entity may use the activities of banks or credit unions for purposes related to fiscal fraud or activities aimed at tax fraud, he will be able to request a blockade of the account. banking (to counteract this). The aforementioned blockade cannot take place for a period longer than 72 hours.

The head of the KAS may extend, by way of a decision, the period of blocking the account of a qualified entity for a specified period, but not longer than 3 months, if there is a justified fear that the qualified entity will not perform an existing or to arise tax liability or liability for tax liability of third parties, exceeding the equivalent of EUR 10,000 converted into PLN at the average EUR exchange rate announced by the National Bank of Poland on the last working day of the year preceding the year in which the decision was issued.

In a situation where the bank account is blocked, the taxpayer will be able to use an application for reconsideration, which must be submitted to the head of KAS. The application will be considered no later than within 7 days from the date of receipt of the application, however, its submission does not suspend the execution of the decision. He may also use the lodging of a complaint to the administrative court through the Head of KAS. The court will be obliged to consider the complaint within a maximum of 30 days from the date of receipt of the files together with the response to the complaint.

Important!

In the response of the Ministry of Finance to the parliamentary question no. 18175, we can read that Account locks will not be used on a massive scale, but only in genuinely justified cases, after a comprehensive risk analysis has been carried out. Such a legal instrument is known in the Polish legal system, e.g. in the Act of November 16, 2000 on counteracting money laundering and terrorist financing (Journal of Laws of 2017, item 1049), which is beyond doubt.

Act on STIR - exceptions to the blocking of funds on the account

The act provides for certain exceptions to the management of funds accumulated on a blocked account. Well, if a qualified entity submits an application to the Head of KAS, and he agrees, then the entity will be able to withdraw funds from the blocked account to:

  • current remuneration for work paid on the basis of an employment contract concluded at least 3 months before the date of blocking the qualified entity's account, together with an advance on personal income tax and social security contributions due on the remuneration paid - after submitting a copy of the payroll and a document from the Insurance Institution Social security confirming application to social insurance under an employment contract;

  • adjudged alimony or a maintenance pension awarded as compensation - upon submission of a title stating the obligation of the qualified entity to pay maintenance or a pension.

Important!

In the case of maintenance benefits and remuneration for work, the release of funds accumulated on the account will only be available up to the amount of the minimum remuneration for work (in 2018 the minimum remuneration is PLN 2,100 gross).

  • payment of the tax liability or customs duty before the payment date from the blocked account of the qualified entity - at the request of the qualified entity, indicating the tax liability or customs duty, its amount and the head of the tax office competent for its collection;

  • payment of tax or customs arrears and late payment interest, in the case of:

    • submission of a declaration, correction of declaration or customs declaration;

    • issuing a final decision establishing or specifying the amount of tax liability or customs duty, confirming the existence of tax or customs arrears;

    • making the decision establishing or specifying the amount of the tax liability or customs duty immediately enforceable, confirming the existence of tax or customs arrears.

Additionally, the Head of KAS, at the request of a qualified entity, may release funds from a blocked account in particularly justified cases.

Important!

The exceptions do not include remuneration of persons with whom a civil law contract has been concluded. However, if for a given person the revenues from the above-mentioned contracts will be the only source of income, it is in principle possible that the Head of KAS, after receiving an application for release of funds for payment of remuneration under civil law contracts, will consider it under the category of special cases.