From 1.01.2024, there will be an obligation for Polish entrepreneurs to issue invoices with the use of the National System of e-Invoices – i.e. KseF.
KSeF – what is it?
The abbreviation KSeF stands for the original Polish name: Krajowy System e-Faktur. The National System of e-Invoices (KSeF)- is an ICT system under the supervision of the National Revenue Administration. The KSeF has been functioning since the beginning of 2022. Yet, there was no obligation to use it by entrepreneurs. The system offers the following functions:
- issuing and receiving structured invoices
- storage of structured invoices
- providing access to structured invoices (also for executive bodies)
A structured invoice is a new type of invoice, which has been present in business since the 1st of January 2022.
Structured invoice – what is it?
A structured invoice is a document in XML format. An entrepreneur issues it with the use of a standardized template available in the KSeF. The KSeF system allows entering each structured e-invoice in a form corresponding to the available template. The template includes all the elements that are obligatory for invoices. There are also optional fields to fulfil. They can be useful in business-to-business trading.
The date of issuing the structured invoice is the day of its entry into the system. The system verifies whether the document is prepared correctly. After that, it assigns an identification number to the correctly issued invoice. Then, the issuer of the invoice receives the Official Confirmation of Receipt. Consequently, the date of receipt of an invoice is the date on which the document obtained its identification number. An invoice that has its identification number is made available to the buyer.
It is worth knowing that a receipt with a tax identification number (NIP) issued for an amount lower than 450 PLN will not be considered an e-Invoice.
How to issue a structured invoice?
It is possible to generate invoices using:
- a free application (including a mobile app) provided by the Ministry of Finance,
- a commercial programme,
The obligation to issue invoices with the use of the KSeF system will cover operations that are subject to VAT taxation in Poland, including:
- domestic delivery of goods,
- providing services between entrepreneurs (B2B), for public authorities (B2G)) or for consumers (B2C).
It is important to keep in mind that one must also issue corrective invoices in the structured form. The obligation applies as well to the invoices issued in different forms before the 1st of January 2024.
Moreover, using the KSeF, the entrepreneur will be able to issue VAT RR invoices and corrective VAT RR invoices. Issuing simplified e-Invoices will still be possible.
Who will have to use the KSeF?
Using the KSeF will be obligatory for the following entities:
- active VAT payers,
- entrepreneurs exempt from VAT,
- taxpayers identified in Poland for the special EU OSS procedure, who have a Polish tax identification number,
It is worth knowing that entrepreneurs will be subject to this obligation, regardless of the company’s industry, size or turnover.
The e-invoicing obligation will not cover those who don’t have a registered office or permanent place of business in Poland. Issuing e-Invoices by these entities will be optional.
Moreover, e-Invoices won’t be obligatory for taxpayers who use special procedures pursuant to section XII, chapters 6a, 7, and 9 of the VAT Act.
An entrepreneur who issues an e-invoice to a non-business entity will have to determine with the counterparty the best way to share invoices. He can provide the invoice in any form. The same solution applies to transactions with entrepreneurs who don’t have a registered office or permanent place of business in Poland.
Advantages of KSeF for entrepreneurs
The Ministry of Finance indicates that the KSeF will be a beneficial solution for entrepreneurs due to the following factors:
- It will quicken the trading process between entrepreneurs. Structured invoices will be sent to the counterparty immediately after issuing.
- Structured invoices are standardized and consistent. One creates them according to a specific template. This will facilitate the accounting process.
- The system will speed up the payment processing. The recipient will receive e-Invoice immediately after entering it into the system.
- An entrepreneur will receive a VAT refund faster. Within a maximum of 40 days, rather than 60 days.
- An entrepreneur can be sure that the invoice won’t be lost and won’t be destroyed in any way.
- The invoice issuer will not have to store it, because the document is available in the KSeF for 10 years.
What will happen in the event of the KSeF’s malfunction?
The Ministry of Finance states that in the event of the system’s malfunction, it will inform the users about the expected date of its repair. Moreover, the administrators will prepare an additional interface independent of the KSeF. It will also inform the taxpayers about the system’s malfunction. Taxpayers’ accounting programs will be able to integrate with it, to automatically check if the problem is fixed.
During the system’s malfunction, a taxpayer will have to use the same structured invoice template and issue invoices accordingly. He should enter the date of issuing an invoice in an appropriate place. A document completed in such a way will be legally binding. The taxpayer must submit it to the buyer in a previously agreed manner.
After repairing the KSeF, one must enter all the invoices issued during the period of malfunction into the system. The issuer will have 7 days to do that.
The Ministry of Finance states that it will notify the users in advance about the planned service works.
KSeF and financial penalties
A taxpayer will be subject to a penalty in the following cases:
- Issuing an invoice without using the KSeF,
- Issuing an electronic invoice during the KSeF malfunction, which doesn’t comply with the standard invoice template,
- Failure to enter into the KSeF an invoice issued during the period of malfunction.
The penalty may be up to 100% of the amount of the tax indicated on a given invoice. In the case of invoices that show no tax, the penalty may be up to 18,7% of the amount due specified on this invoice.
If a taxpayer did not issue an e-Invoice at all, or its form doesn’t comply with the template, the penalty will not be lower than 1000 PLN.
If the taxpayer fails to submit an invoice on time, the penalty will amount at least to 500 PLN.
Do you run a company and the National System of e-Invoices seems complicated to you? Contact our law firm. With the help of our experts, you will prepare your company for the upcoming changes. Do not hesitate to contact us!