Establishing a limitation period, after which the taxpayer can no longer benefit from the bad debt relief, is not contrary to EU law (Supreme Administrative Court judgment of 23 November 2021, reference number I FSK 391/17).
According to the CJEU judgment C-335/19, it is possible to apply bad debt relief regardless of the debtor’s status. However, for the application of this relief, the relevant time-limit is the expiry of which the taxpayer who is the creditor in respect of a debt that has finally become uncollectible can no longer rely on its right to reduce the tax base. According to the current regulations, if 3 years have elapsed from the date of issuing the invoice documenting the debt, counting from the end of the year in which it was issued, the taxpayer can no longer take advantage of the bad debt relief.
Source Deloitte Poland
