Incorrect Position of VAT on Additional Fee for Non-Compliant Use of Parking – Individual Interpretation

• The Director of the National Tax Information states that the taxpayer’s position regarding the tax consequences of an additional fee for non-compliant use of a paid unguarded parking lot is incorrect.
• The taxpayer’s request for an individual interpretation was submitted on August 1, 2023, and it concerns the non-taxability of an additional fee related to non-compliant use of a paid unguarded parking lot.
• The municipality is a registered taxpayer of VAT and operates 5 municipal parking lots located outside of public roads. The municipality charges fees for parking and for unauthorized use based on a resolution of the Council.
• The resolution defines the fee for unauthorized use as a fee for not paying the parking fee or for exceeding the paid parking time without a valid parking ticket displayed properly in the vehicle.
• The unpaid fees for unauthorized use are collected through court enforcement using vehicle owner data obtained from the CEPIK registry.
• The municipality considers the additional fee as compensation in the form of a contractual penalty for occupying a paid parking space without paying the appropriate fee, thereby preventing other users from using the parking lot and the municipality from collecting fees.
• The municipality argues that the additional fee is not a payment for services or goods but rather compensation, a contractual penalty determined according to the parking regulations, and therefore not subject to VAT.

Source: sip.lex.pl

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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