Poland is among the 31 European countries that have adopted e-invoicing. Poland’s Ministry of Economic Development, Labour, and Technology released a set of principles to implement e-invoicing in Poland via Peppol.
The adoption of e-invoicing in Europe aims at solving a fundamental problem. Previously, there were so many e-invoice formats in the region, and it was difficult to exchange financial data across borders.
More so, issuing the existing paper/PDF invoicing format is costly, error-prone, and time-consuming.
As a result, EU countries and the European Commission agreed on implementing a central e-invoicing system through Peppol to facilitate interoperability between the European countries and other countries where Peppol is adopted.
Despite this uniformity of purpose, each country adopts the e-invoicing system slightly differently based on their choice exchange platform, timeline, method of e-invoicing exchange, e-invoicing format, and lots more.
So, if you’re looking to comply with e-invoicing in Poland via Peppol, read till the end.
This article will cover the rules and requirements for e-invoicing, how private businesses and public entities can send e-invoice, and the best way to stay compliant with e-invoicing in Poland through Storecove.
What is Peppol e-invoicing in Poland?
Peppol e-invoicing in Poland is a set of specifications governing the national and cross-border exchange of electronic invoices for transactions in the country.
For example, when you carry out a B2B transaction, a digital copy of the sales invoice is generated and exchanged between the seller, buyer, and tax authority.
This invoicing method works like the traditional paper invoice, but it is more secure and cost-effective.
As in many European countries, Poland has initiated electronic invoicing through Peppol.
What is Peppol?
An invoice is a confidential document, and its digital exchange requires technical knowledge.
Peppol sets the technical specifications that make e-invoicing easy and works between e-procurement platforms and tax authorities.
To illustrate, let’s say an organization sends its e-invoice to the tax authority through the e-procurement system; Peppol will intercept it and check whether the e-invoice format and information align with the standard specifications.
After that, Peppol will either reject or forward the e-invoice to the tax authority after the verification process.
Why was Peppol e-invoicing implemented in Poland?
Poland implemented Peppol’s e-invoicing to curb tax fraud and close the significant VAT gap in Poland.
On a broader note, developing an efficient tax collection process is another reason for adopting Peppol e-invoicing in Poland.
The existing paper/PDF invoicing is flawed since tax auditors get access to an invoice long after the conclusion of the transaction.
This undermines transparency.
The e-invoicing mandate will promote the Continuous Tax Control (CTC) system, which puts tax auditors in control of transaction ledgers in real-time, thus increasing the speed and accuracy of tax collection.
Adopting Peppol e-invoicing in Poland will reduce administrative burdens for companies.
E-invoicing is a technology-backed alternative for taxation, business transaction recording and storage, and manual administrative processes.
Is e-invoicing mandatory for all?
From 2023, e-invoicing will be mandatory for all taxpayers in Poland. Companies would have a year to prepare their management systems to comply with the new e-invoicing mandate.
Poland’s e-invoicing mandate was initially facilitated through the Standard Audit File for Tax (SAF-T) in 2020. But SAF-T’s does not enable the tax authority to access e-invoices in real-time because taxpayers send their invoice monthly.
So, Poland has now adopted an automated invoicing system mandatory for all B2B and B2G transactions.
Notably, e-invoicing is voluntary within the one-year compliance period in Poland. Meaning that it can only be used if both supplier and seller agree. After this period, e-invoicing will become mandatory in Poland.
What are the Peppol e-invoicing requirements in Poland?
Poland’s e-invoicing requirement follows Peppol’s BIS 3.0 billing standard because it has not developed its own national Core Invoice Usage Specifications (CIUS).
Accordingly, Peppol’s Business Interoperability Specifications (BIS) is also compliant with the European E-16931 e-invoicing standard.
With this arrangement, registered public bodies in Poland should receive electronic invoices from other Peppol-connected companies across Europe.
In addition, Poland has also announced that all B2B and B2C e-invoices must be in the FA_VAT (a standard XML format) and issued and received through the national e-invoicing system Krajowy System e-Faktur (KSeF).
The KSeF has started operation on 1 January 2022.
Once the mandatory period is effective, e-invoices would be archived automatically on KSeF for ten years.
The tax authority would easily access sufficient tax records for auditing purposes. Taxpayers may also store copies of e-invoices as evidence of tax.
How to process and exchange e-invoices in Poland
Taxpayers need an ERP system that aggregates their financial records with the KSeF portal through the Peppol certified API to process and exchange e-invoices in Poland.
E-invoicing is voluntary for Poland’s B2B and B2C companies until 2023, so businesses must learn to stay compliant.
Here are a few steps to follow to remain compliant and exchange e-invoicing in Poland.
- Set up an Enterprise Resource Planning (ERP): The ERP is a financial and accounting platform that automates business processes and provides insights. As an access point provider, the ERP digitizes your transaction activities following standard technical specifications so that you can easily comply with the e-invoicing mandate. ERPs in Poland must operate on e-invoicing access points recognized by Peppol only.
- Upgrade existing ERP: If you’re working on an in-house ERP beforehand, you can upgrade the platform to meet the requirements of the e-invoicing mandate in Poland. Otherwise, you can get started with Storecove today, a Peppol-certified e-invoicing service in Europe.
- Integrate the ERP with PEF/KSeF: If you’re a public entity or government, you should integrate your ERP with the PEF. PEF is equivalent to KSeF but strictly for B2G companies. All public entities must register their account on PEF. B2B and B2C companies will integrate their ERP with KSeF, the market solution that works with Peppol.
- Prepare invoices in XML format: Taxpayers will prepare e-invoices in their ERP platform according to FA_VAT’s specified format, FA_VAT.
- Transfer e-invoice to the KSeF: After the ERP has formatted the e-invoice to the XML format, it is then transferred to the KSeF website for verification.
- Verification of e-invoice: The system checks format compliances when an e-invoice is sent to KSeF. A structured e-invoice will contain information related to the payment, payment procedure, and transaction terms. Therefore, an approved e-invoice is stamped and indexed with a unique number.
Exchange compliant e-invoices via Peppol with Storecove
With Peppol’s e-invoicing system, Poland looks to digitize business operations, close the VAT gap, tackle tax fraud, and cut invoicing costs in the country.
The country has adopted Peppol as its primary access point provider to enable a seamless national and cross-border e-invoicing exchange. And Peppol follows the European e-invoicing standard.
As such, all taxpaying businesses must issue and receive e-invoices from 2023. At that time, an API provider must enable taxpayers’ financial and accounting systems that comply with the Peppol standards.
More information on Peppol in Poland?
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