Changes in the functioning of call-off stocks from January 2020 (part 1)

Co-Size-Changing

The transfer of own goods to the consignment warehouse (call-off stock warehouse) allows the supplier, under many conditions, to recognize WDT only at the time of transferring the right to dispose of the goods as an owner, which may take place even in a few months.
However, from the new 2020, the legislator adds a few restrictions, or rather additional, more demanding conditions that will have to be met in order to take advantage of the preferences provided by the procedure for the operation of call-off stocks. In this article, we present the changes in the functioning of call-off stock warehouses from January 2020.

In what area will there be changes in the functioning of call-off stock warehouses?

Another of the many significant changes to the VAT Act, which will come into force in January 2020. there is a change in the area of ​​warehouse operations according to the call-off stock procedure.

This change introduces several new rules enabling the use of WDT and WNT identification preferences as part of the operation of the call-off stock warehouse. Prawodwaca also added many restrictions, where fracture, at least one, is associated with earlier diagnosis of WDT and WNT.

Where did these changes come from?

The obligation to adjust Polish tax law with regard to the principles of operation of consignment warehouses, i.e. the rules for taxing international transactions, results from the newly created Council Directive (EU) 2018/1910 of December 4, 2018, which updates Directive 2006/112 / EC, hereinafter referred to as the VAT Directive.

Who will be affected by the changes to the regulations?

The new regulations will apply to active VAT payers registered for the purposes of making EU transactions (both suppliers and recipients trading goods with EU contractors) who deliver their own goods to the call-off stock warehouse or collect them themselves from this warehouse, while taking advantage of the ICS / ICS recognition advantage at the time of transfer to the recipient of the right to dispose of the goods as owner.

What is a call-off stock (consignment warehouse)?

The legislator in Art. 2 clause 1 point 27c of the VAT Act specified that the consignment warehouse is a separate taxpayer registered for intra-Community transactions (i.e. the EU VAT taxpayer), a place of storage in the territory of the country (e.g. Poland) of goods belonging to another taxpayer who is an active VAT payer moved by him or on his behalf from the territory of a Member State other than the territory of the country (e.g. Poland) to the place from which the taxpayer registered as an EU VAT taxpayer, who stores the goods, collects them, and the right to dispose of these goods as the owner is transferred precisely in when you download them.

Change in the tax obligation as part of the call-off stock procedure

From January 2020, the moment when the tax obligation arises will change. By the end of 2019, pursuant to Art. 20a paragraph. 1 of the VAT Act, the tax obligation in the event of the transfer of goods to the consignment warehouse for their subsequent delivery to the VAT taxpayer arose upon the delivery of the goods, but not later than upon the issuance of the invoice confirming this delivery to the value added tax taxpayer, provided that the value added tax payer of the added tax is obliged to prove the movement of goods in the Member State of completion of transport or shipment and the delivery of goods as an intra-Community acquisition of goods in the month in which the taxpayer was taxed for this delivery.

In turn, from January 2020, the tax obligation under the implementation of the WDT relating to goods moved to the call-off stock warehouse will arise:

  1. at the time of issuing the sales invoice by the taxpayer, but

  2. not later than on the 15th day of the month following the month of delivery of the goods

Adding new conditions for the functioning of the call-off stock procedure

The movement of goods as part of the call-off stock procedure does not constitute an intra-Community supply of goods, hereinafter referred to as WDT. Therefore, one of the important functions of the warehouse operation is to enable the avoidance of settlements under the recognized intra-Community supply of goods as well as registration by the supplier for VAT in the country of destination of the goods in order to then settle the non-transactional intra-Community acquisition of goods, hereinafter referred to as intra-Community acquisition of goods.

A Polish taxpayer supplier of goods who transfers goods to a call-off stock warehouse located outside the territory of the Republic of Poland, but in one of the EU Member States will be able to recognize WDT as part of the call-off stock procedure (under certain conditions) and avoid numerous obligations with VAT registration in the recipient's member state.

The new conditions, upon fulfillment of which the supplier will experience WDT as part of the call-off stock procedure, are:

  1. the goods are dispatched or transported by a taxable supplier (or on his behalf) registered as an EU VAT taxpayer, from the territory of the country to the territory of a Member State other than the territory of the country for their delivery at a later stage and upon their arrival at the VAT payer of the beneficiary to acquire the right to dispose of the goods as the owner in accordance with the previously concluded agreement between these taxpayers,

  2. the supplier has no seat of business or a fixed place of business in the territory of the Member State to which he transfers the goods from his territory,

  3. the value added tax payer to whom the goods are moved (dispatched or transported) is identified for the purposes of intra-Community transactions in the territory of a Member State other than the territory of the country, and his name or surname and identification number for intra-Community transactions assigned to him in the territory of that Member State are known to the suppliers when shipment or transport begins,

  4. the supplier registers the movement of goods in a specially kept records of the movement of goods and provides the tax identification number in the summary information.

The supplier of goods is most interested in the possibility of implementing the intra-Community supply of the goods that are transferred to the call-off stock warehouse, but he should remember that to do this he must be registered for the purposes of conducting EU transactions (i.e. being a VAT-EU taxpayer) already at the time of commencement of transport or shipment of these goods.

Example 1

Polish, an active VAT and VAT-EU taxpayer with a registered office in Poland, transferred his own goods intended for sale to an active VAT taxpayer from Germany in April 2020 to a call-off stock warehouse located in Germany.

In May 2020, the right to dispose of goods as an owner was transferred to the German taxpayer of the recipient.

In such circumstances:

  • Polish, active VAT payer should include the movement of goods from Poland to the call-off stock warehouse in the register of goods moved,

  • the entity running the warehouse registers in its records the receipt of goods to the call-off stock warehouse,

  • the Polish taxpayer in the settlement for May 2020 (the month of transfer of the right to dispose of goods as the owner) shows the ICS both in the VAT declaration and in the summary information (he will use the German recipient's tax identification number) and the German taxpayer will also show the VAT in both declarations (with the Polish seller's tax identification number) ).

When the above conditions are met, the movement of goods as part of the call-off stock procedure will be identified as WDT, but provided that it occurs within 12 months from the moment the goods are delivered (registered) to the warehouse.

However, it will not always be possible to use the procedure for the operation of call-off stocks after the changes in the regulations, but more about it in the second part of the publication.