Voucher as a form of promotion and tax settlement

Service-Tax

In order to increase sales, entrepreneurs organize promotional campaigns. Very often, as part of such campaigns, vouchers for services rendered or goods sold are sold. As practice shows, companies have a problem with their settlement, and the problems are additionally aggravated by unclear regulations in this area. Let's check how to settle the voucher sold as part of promotional campaigns on the basis of income tax and tax on goods and services!

What is a voucher?

According to the Dictionary of the Polish Language, the voucher is:

  • written proof,
  • a document confirming the conclusion of the transaction,
  • declaration or authorization in writing,
  • certificate, authentication letter.

It follows from the above definition that the voucher is neither a property nor a property right, nor does it fall under the term "service". It is only a document that confirms the rights of its holder, e.g. to purchase a certain benefit (or purchase goods) within a specified period.

Unused voucher and the moment of generating income on the basis of PIT

Income from non-agricultural economic activity is considered to be the amounts due, even if they have not been actually received, after excluding the value of the returned goods, granted discounts and discounts.

Importantly, in the case of taxpayers selling goods and services subject to tax on goods and services, the revenue from this sale is considered to be revenue less the due tax on goods and services. This means that, as a rule, the revenue is the net amount resulting from the invoice documenting the sale of goods or the performance of a service.

The general rule concerning the determination of the moment when income from economic activity arises is set out in Art. 14 sec. 1c of the PIT Act. It stipulates that the date on which this income arises is the date of delivery of the item, sale of the property right or performance of a service or partial performance of the service, no later than on:

  • issuing an invoice or
  • payment of receivables.

The moment when revenue arises is first determined by the date of delivery of the goods, sale of the property right or performance of the service. This will be the case when the taxpayer issues an invoice after the goods are delivered or the service is provided.

The sale of documents or intangible forms entitling to exchange for goods or services or to purchase them at a discount does not generate taxable income in income taxes. It should therefore be concluded that the issue (sale) of a voucher is not a delivery of goods or a provision of a service. Thus, on the date of issue of the voucher, no tax income is generated on the part of the entrepreneur. Such revenue arises, as a rule, at the moment of realization of a document or an intangible form, i.e. issuance of goods or services in return or taking into account a discount.

Such a position was confirmed by the Director of the Tax Chamber in Poznań in the individual ruling of 12 December 2013, ref. No. ILPB1 / 415-1029 / 13-2 / AP, where we can read:

Since the tax revenue should be recognized at the time of the service, the received payment for the Voucher should also be treated as an advance payment for the later performance of the service. Such additions are excluded from revenues pursuant to Art. 14 sec. 3 point 1 of the Personal Income Tax Act, pursuant to which the revenues referred to in para. 1 and 2 (ie revenues from non-agricultural economic activity), collected payments or accumulated receivables for the supply of goods and services that will be performed in the following reporting periods are not included.

However, in a situation where the customer does not exercise the rights resulting from the Voucher for a specific service within a specified period, the Applicant is obliged to recognize the revenue in the amount not used by the customer on the last day of the settlement period.

To sum up, if a Voucher is issued for a specific service, the revenue should be recognized only at the time of the service or the expiry of the Voucher - if the Voucher is not used within the prescribed period (...). In a situation where the buyer does not use the sold document or intangible form on its payment date (and the purchase amount is not returned to him), the revenue should be recognized on the last day of the settlement period. As we read in the letter of the Minister of Finance of May 30, 2012, which constitutes a change in the individual interpretation (reference number DD9 / DD2 / 033/225 / BRT / 09 / PK-1280):

(...) if the customer does not use the card within the prescribed period of validity of the card, the amount of the card and which was paid by the customer purchasing the card should be recognized as tax income on the last day of the settlement period (... ).

Example 1.

Mrs. Anna runs a beauty salon and sold a voucher for the procedure. The voucher was valid until December 31st. It was not used by the client by this date. Therefore, should Ms Anna settle the issued voucher on the basis of income tax?

Due to the fact that the voucher has not been used by the client, Ms Anna should recognize the revenue on its expiry date, which means that in this case the revenue will be generated on December 31st.
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Voucher and VAT obligation

According to the general rule contained in Art. 19a paragraph. 1 of the VAT Act, the tax obligation arises when the goods are delivered or the service is performed.

If, prior to the performance of the service / delivery of the goods, all or part of the payment has been received, in particular prepayment, advance payment, down payment or installment, the tax obligation arises upon its receipt, in relation to the amount received. The amount of VAT on the advance payment is calculated using the "in one hundred" method, which means that the received value should be treated as a gross amount. The cash payment made by the buyer in connection with the purchase of the vouchers should be treated as an advance payment for the future supply, which is subject to VAT at the time of its receipt. Such a position was confirmed by the Director of the Tax Chamber in Bydgoszcz in a letter of September 26, 2014, file ref. ITPP1 / 443-623 / 14 / DM, in which we read:

(...) the sale made by the Applicant concerns a "specific service", it should be considered that the payment made by the client is related only to this activity. For these reasons, the amount of money transferred should be treated as an advance / prepayment for a specific benefit.

Taking into account the above, it should be indicated that the client pays an advance / prepayment - in this case in the amount of 100% of the service fee, because, according to the application, "the amount paid is 100% of the amount due".

Thus, the received amounts of money for the performance by the Applicant of specific services constitute the turnover subject to tax on goods and services, and the tax obligation, in accordance with Art. 19a paragraph. 8 of the quoted act, arises - as rightly indicated in the application - upon their receipt (...).

Example 2.

Mr. Jan runs bookstores and on September 10 he sold a voucher for the purchase of books. The voucher expires on December 15th. The customer has not used the voucher before its expiry date. How should Mr. Jan tax the sale of the voucher?

In terms of VAT, the sale of a voucher is subject to a tax obligation on the date of receipt of payment, i.e. on September 10. Due to the fact that the client did not use it before the expiry date, the taxable income was generated on the basis of the income tax on December 15th.