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Split Payment in SAP systems

New SNP solution for split payment in SAP

Author: Arkadiusz Babiński Publication: 2018

Article published in the SNP company magazine: Better Business

On 1 November 2019, the act of 9 August 2019 amending the act on tax on goods and services and
certain other acts will come into force, introducing an obligatory split payment mechanism. The Polish
entrepreneurs can use the split payment since July 2018 – however, earlier participation in the
mechanism was voluntary. As of November 2019, the split payment will be obligatory for a large part of
entrepreneurs.

Split payment
As a reminder, the split payment is a mechanism whose basic assumption is the splitting of payments
for delivered goods and services into the net amount and the amount of VAT, which will be paid to the
supplier’s separate accounts at the bank: a current account and an additional VAT account.
Subsequently, using this account, a counterparty will pay their liabilities related to tax on goods and
services, resulting from invoices received from their suppliers, and to tax authorities.

Until now, the decision to join the mechanism was to be taken by the buyers who received an invoice
with an indicated amount of tax. The participation in it was formally voluntary, however the legislation
introduced a number of benefits of applying the split payment mechanism to encourage entrepreneurs
to use it. These benefits include: obtaining a VAT refund on the VAT account within a shorter period, a
reduction in the amount of tax payable in the event of paying VAT from the VAT account before its due
date.

Who is obliged to apply split payment?

The split payment must be applied when all of the following conditions are met:

the tax obligation, the delivery of goods or ...

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