According to Article 5, Section 1 of the VAT Act, VAT generally applies to the paid delivery of goods and the paid provision of services within the country’s territory. However, Article 8, Section 1 of the VAT Act defines the provision of services as any provision to natural persons, legal persons, or organizational units without legal personality that does not involve the supply of goods.
Exceptions to the general rule exist, where specific services (objective exemption) or services provided to specific entities (subjective exemptions) are exempt from VAT. For instance, according to Article 43, Section 1, Point 12, Letter a of the VAT Act, services related to managing investment funds, alternative investment funds, and collective securities portfolios are exempt from tax.
To qualify for VAT exemption under Article 43, Section 1, Point 12, Letter a of the VAT Act, two conditions must be met:
1. The services provided must qualify as management services.2. The services in point 1 must be provided in relation to investment funds, alternative investment funds, or collective securities portfolios, as defined in the provisions on investment funds and the management of alternative investment funds.
These conditions align with the interpretation of the VAT Act provided in various sources, including tax law provisions and the Director of the National Tax Information’s individual interpretation issued on May 13, 2022.
The definition of “management services” for investment funds has evolved due to EU legal requirements and court rulings. While the concept was directly defined in the VAT Act until March 31, 2013, subsequent changes in legislation removed this direct definition. This was done to align Polish laws with EU jurisprudence, such as the C-275/11 GfBk and C-169/04 Abbey National cases, which emphasized the autonomous nature of the term “management of investment funds” under EU law.
As a result, EU law now defines what constitutes “management of investment funds.” These definitions include not only actions related to investment management (implementing the funds’ investment policies) but also administrative activities, including legal support.
The scope of “management of investment funds” includes a wide range of activities, such as legal support, as defined in the EU directive. This broad interpretation allows for the inclusion of various support and services requiring specialized legal knowledge and experience.
Furthermore, the services provided do not fall under the category of advisory services, as defined in the EU directive. Therefore, they qualify for VAT exemption under Article 43, Section 1, Point 12, Letter a of the VAT Act.
In conclusion, the services provided by the company to investment funds and alternative investment funds qualify for VAT exemption under Article 43, Section 1, Point 12, Letter a of the VAT Act, as they fulfill both the substantive and subjective criteria for the exemption.
Source: sip.lex.pl
