When does a supply of goods take place for VAT purposes?

The case concerned a company making domestic and cross-border supplies of goods through third-party carriers. Domestic transport took between two and seven days, while international deliveries could take up to several weeks. The transactions were carried out under the Incoterms DAP rule.

According to the facts presented by the company, the right to dispose of the goods as owner passed to the customer only when the consignment was collected from the carrier. Consequently, the release of the goods from the warehouse and the commencement of transport did not yet constitute a supply within the meaning of Article 7(1) of the Polish VAT Act.

Determining the date of supply requires a case-by-case assessment of when the customer acquires the effective ability to dispose of the goods as owner. This does not necessarily coincide with the formal transfer of legal title. The contractual provisions, the agreed allocation of risk and the way in which the transaction is performed in practice are all particularly relevant.

Although Incoterms rules may form an important part of this assessment, they do not, in themselves, determine when a supply takes place for VAT purposes. It is also necessary to establish the legal and commercial consequences that the parties have actually attached to the agreed delivery terms.

An invoice may be issued before the supply takes place

The company intended to issue invoices when the goods were handed over to the carrier. As a general rule, this is permitted under Article 106i(7) of the Polish VAT Act, which provides that an invoice may not be issued more than 60 days before the supply takes place or before all or part of the payment is received.

The difficulty was that, when issuing the invoice, the company did not know the date on which the consignment would actually be collected. The delivery date could change for reasons beyond its control, and the relevant information would only become available later from transport documents, proof of delivery or the carrier’s tracking system.

The company therefore proposed issuing invoices without specifying the date of supply and subsequently recording them in its VAT records for the period in which the goods were actually collected by the customers.

An unknown date of supply does not have to appear on the invoice

The Director of KIS agreed with the company’s position. The authority referred to Article 106e(1)(6) of the Polish VAT Act, under which an invoice must state the date on which the supply of goods was made or completed, provided that this date has been determined and differs from the invoice issue date.

Where the date of supply is objectively unknown when the invoice is issued, this condition is not met. The taxpayer may therefore issue an invoice without specifying the date of supply, and the invoice remains formally valid.

The ruling should not, however, be interpreted as granting taxpayers a general right to omit the date of supply. It applies to a specific model in which the invoice is issued before the supply takes place and the actual delivery date cannot yet be established. If the supply has already taken place or its date is known, that date should be included on the invoice if it differs from the invoice issue date.

Establishing the date later does not require a corrective invoice

KIS also confirmed that the company would not be required to issue a corrective invoice once it had obtained information confirming the actual date on which the goods were collected.

A corrective invoice is required, among other circumstances, where an error has been identified in the original document. In the case under consideration, however, the omission of the delivery date did not constitute an error. The invoice was correct in light of the circumstances existing when it was issued because the relevant date had not yet been determined. Establishing that date at a later stage does not alter the original invoice’s status or create an obligation to supplement it.

This is an important conclusion for businesses that have previously entered an estimated date of supply on their invoices and subsequently issued corrections whenever the goods reached the customer on a different date.

Omitting the date from the invoice does not affect the VAT reporting period

The simplification concerning invoicing does not alter the rules governing the tax point. Under Article 19a(1) of the Polish VAT Act, VAT generally becomes chargeable when the goods are supplied. Issuing an invoice in advance does not bring the tax point forward.

For example, if an invoice is issued on 29 September but the customer collects the consignment on 2 October and, under the agreed terms, acquires the right to dispose of the goods as owner only on that date, the transaction should be reported for October.

The seller must therefore still establish and document the actual date of supply. This information is necessary to report the transaction in the correct VAT period, even if it is not shown on the invoice. In practice, this may require the accounting system to be integrated with warehouse records and data received from carriers.

Consequences for the customer

Receiving an invoice before delivery does not automatically entitle the customer to deduct input VAT. Under Article 86(10) and Article 86(10b)(1) of the Polish VAT Act, the right to deduct generally arises in the period in which VAT becomes chargeable in respect of the purchased goods, but no earlier than the period in which the taxpayer receives the invoice.

If the customer receives an invoice towards the end of a month but the goods are not delivered until the following month, input VAT should not be deducted in the period in which the invoice was received. The actual date of supply must instead be established on the basis of transport documents, proof of delivery or other reliable evidence.

Practical implications for businesses

The ruling confirms that an invoice should be assessed by reference to the information available when it was issued. A taxpayer cannot be required to state a delivery date that could not objectively have been determined at that time or subsequently correct a document that complied with the statutory requirements from the outset.

Before adopting this approach, however, businesses should review their terms of sale, determine when economic control over the goods passes to the customer and establish how delivery is documented. The flow of information between the logistics and accounting functions may also need to be adjusted. Omitting the date of supply from an invoice may simplify the invoicing process, but it does not remove the obligation to determine the correct VAT reporting period.

It should also be remembered that an individual tax ruling directly protects only the applicant and only in relation to the facts described in the application. For other businesses, the ruling provides valuable interpretative guidance, but adopting a similar approach should be preceded by an analysis of their specific delivery model.