Scrap in the light of the VAT Act


Pursuant to Art. 17 sec. 1 point 7 of the VAT Act, a taxpayer is also an entrepreneur who purchases scrap metal if the following conditions are met:

  • making the delivery is the taxpayer referred to in art. 15, where the sale is not exempt from tax pursuant to art. 113 paragraph. 1 and 9. We are talking here about a legal person, an organizational unit without legal personality or a natural person conducting independent economic activity, in which the value of sales exceeded PLN 150,000 in the previous tax year (throughout the year or in proportion to the number of months, if they started activity during the financial year),
  • the buyer is the taxpayer referred to in art. 15 (i.e. legal persons, organizational units without legal personality and natural persons conducting independent economic activity),
  • the delivery is not covered by the exemption referred to in Art. 43 sec. 1 point 2, i.e. it does not apply to second-hand goods, which are considered to be goods which were purchased after 6 months, and upon their purchase, there was no right to deduct VAT.

Scrap definition

The main issue for the application of the appropriate method of settling the tax on goods and services is to determine whether a given good falls under the concept of scrap. The VAT Act does not provide an exact definition of scrap. The definition of scrap for the purposes of the VAT Act was explained by the Minister of Finance in the general interpretation of May 2, 2011 (PT3 / 033/2/188 / LWA / 11/569). According to this interpretation, scrap for the purposes of the VAT Act should be understood as metal scrap, including steel (charge and non-batch), cast iron and non-ferrous metal scrap, as well as precious metal scrap. In this sense, scrap also includes spent lead batteries or their parts. The concept of scrap does not include, for example, waste batteries and vehicles. Annex 11 to the VAT Act contains a list of goods belonging to particular groups of scrap.



PKWiU symbol

Name of item (group of items)



Pellets and powder of pig iron, specular pig iron or steel - only ingots or geese, usually of high-alloy steel, obtained by remelting and pouring fine waste or scrap



Other non-ferrous metals and articles thereof; cermets; ash and residues containing metals and metal compounds - only base metal waste and scrap


Glass waste


Residual rubber waste


Plastic waste


Metal-containing non-hazardous waste



Waste and shortage of electric cells and accumulators; spent primary cells, spent primary batteries and spent electric accumulators



Secondary raw materials from other metals - only waste and scrap

Settlement of VAT in scrap metal trading

On March 18, 2011, the act on VAT was amended with regard to the provisions of scrap metal trading. Pursuant to this amendment, the self-taxation mechanism applies to scrap metal trading as of April 1, 2011. In this case, it is the scrap buyer who becomes responsible for the payment of VAT. This means that the supplier does not show the VAT due on his invoices, but invoices the delivery of scrap in the net amount. It is the buyer who has to tax the purchased items as well as declare and account for VAT. Thus, the buyer is obliged to issue an internal invoice. VAT is recognized both on the purchase and sale side. The tax obligation and the right to deduct input tax arise in the same accounting period. The taxable amount is the amount the buyer is obligated to pay to the supplier. The purchase of scrap is based on principles similar to the WNT - intra-Community acquisition of goods or import of services. An internal invoice is issued and the transaction becomes tax neutral.