The so-called Special Act may withhold a VAT refund

In connection with the epidemic announced in Poland, the so-called Special Act provides for, inter alia, suspension in the running of procedural and judicial time limits. Although at first glance this solution seems right, on the other hand, it can be used by tax authorities to block (withhold) VAT refunds.

Pursuant to the wording of Article 15zzr paragraph 1 of the Special Act, the suspension shall apply to such issues as the running of strict limitation periods, which, if not observed, would entail negative effects for a party. Therefore, only such time limits may be suspended, which will have negative effects on the taxpayer if they are not complied with. This shows that a tax authority will not be able to withhold (suspend) VAT refunds – these should still be implemented on the existing basis. The situation gets complicated when the authority has doubts regarding the justifiability of VAT refunds.

Article by Monika Lewińska, a VAT specialist, is now available on Lexplorers.