VAT in transport: most important information. What to take notice of and when to pay it?

You want to order carriage of goods but you are not sure if you will receive a VAT or a non-VAT invoice from a carrier? To resolve your doubts, we prepared a short guide.

A VAT or a non-VAT invoice?

Transport companies operating legally in Poland are obliged to register every order or to issue an invoice. An invoice will or will not include VAT, depending on who orders carriage and what is the place of delivery.

The basic principle assumes that a carrier must issue a VAT invoice if their customer is a natural person, i.e. a person who does not conduct business activities. In such a case the customer’s citizenship does not matter. The situation becomes more complicated if transport of goods is ordered by a company, in which case the legislator explicitly separates transport within Poland and the EU from international transport.

In order to issue an invoice correctly, carriers must refer to the provisions of the Value-Added Tax Act of 11 March 2004. If transport services are ordered by a Polish company, then, regardless of where the transport takes place (within Poland or the EU), a transport company is obliged to issue a document registering the provision of the service including VAT.

The only exception is the situation when a Polish company orders carriage of goods from Poland to a country, which is not the EU’s member state. In such a case, a carrier may issue a non-VAT invoice assuming that they will receive documents confirming customs clearance.

Polish transport companies often cooperate with foreign entities. What about invoices in such cases? Regardless of whether a foreign counterparty orders transport within Poland or the EU or outside of it, a carrier issues a non-VAT invoice.

When does a 0% VAT apply?

The question referring to invoices issued by carriers for the services performed is very broad. It is important to remember about at least a few exceptions provided for by the legislator. In case of international transport, carriers may apply a 0% VAT rate, if a route passes also through Poland and if they hold the documents indicated by the legislator (listed in article 83 clause 5 point 1 of the Act on VAT).

Other situations in which a carrier is allowed to apply a 0% VAT rate are laid down in the Regulation of the Minister of Finance of 23 December 2013 on goods and services eligible for a reduced VAT rate and terms of application of reduced rates. In accordance with the regulation, carriers may apply such reduced VAT rates, for example, if the whole carriage of goods takes place within the territory of the country (Poland) and constitutes a part of international transport services.

Transport outside the European Union and additional fees

When ordering carriage of goods you must be aware of fees you will be obliged to pay. Each country has its own duty-related policy. The EU member states apply the regulations developed especially for the EU’s customs territory.

In case of transport of goods to countries outside the EU you will have to read the applicable provisions. It might also be necessary to pay a freight rate whose amount is established by the legislator of a given country.