Module Hogart divided payment/Hogart Split payment!
Split payment is expected to take effect from April 1st, 2018 year. May 12, 2017 The Ministry of Development and Finance has published a draft amendment to the VAT Act. Taxable persons who have received an invoice with the amount of VAT indicated shall be able to choose whether to pay the document in full to the basic account of the supplier or to make the payment using the split payment mechanism. The issuer of the invoice will therefore not have any actual effect on the type of payment method used by its customers.
The benefits of a split payment
The entity that will apply the split VAT payment mechanism is to be entitled to many of the privileges that will be associated with this system. The privileges will be so attractive to taxpayers that they themselves will want to use it.
Split payment The premise of due diligence
It is assumed that entrepreneurs who decide to run a system for the decoupled VAT payment will not be subject to sanctions under the VAT Act (30 or 100% of the amount of the obligation in the case where the invoice was badly settled) and also the so-called. Solidarity responsibility. According to the Ministry of Finance, the use of split payment will be a strong indication that the taxpayer has retained due diligence in the transaction with the counterparty.
Faster tax return for taxpayers using the split-payment method
The greatest benefit for traders applying the method of a separate payment will be applied to them, the so-called. Fast VAT Refund path within 25 days.
Choose the Hogart module for a split payment, designed for upcoming VAT regulatory changes.
We encourage you to contact your trading advisors to arrange suitable time limits and to provide details of your offer.
Potential inconvenience to the taxpayer. The split payment method assumes that the net amount sold for the goods or services will affect the existing company account, the VAT amount will be transferred to the additional dedicated bank account of such payments. The amount of VAT accumulated on this separate account will be used to pay the invoice to your Subcontractor or pay for VAT to US. The introduction of Split Payment may result in a loss of liquidity for the trader because the excess VAT amounts will be blocked on the respective accounts.
Impact on information Systems
Any company that uses electronic data interchange systems (sending payment for liabilities and receiving payments for receivables) will need to make appropriate changes to the information systems. Today, transfers are going to parcels, summed in gross amounts and are allocated to receivables accounts. Once the Split payment has been entered, payments will have to be made in net and VAT values separately and likewise posted. This forces changes in electronic banking systems. We encourage you to contact us to arrange the details of the work necessary to carry out the necessary adjustments.
Impact on the taxpayer’s financial liquidity
Withholding of VAT funds on bank accounts may result in temporary financial bottlenecks. To avoid this, financial analysis of the structure of revenue and payments should be made. Hogart together with the company firm BDO Sp Z o.o. or Global Audit Partner Sp. z o.o. Sp. K. offers an analysis in this area where the service offers:
- Analysis of the structure of revenues and costs and payments,
- Preparation of a simulation model and analysis of what-if financial flows with interpretation of the results of the introduction of Split Payment at the selected moment in time, based on historical taxpayer data for the last three years,
- Preparation of the presentation for the management or management of the results of the analysis presented with the use of the BI system, including recommendations, to apply the appropriate liquidity protection mechanisms to be implemented during the transitional period.