The European Court of Justice issued a judgment in the Polish case C-442/22, where an employee of a Polish company issued fake invoices for fuel. The tax authorities issued a VAT claim against the company, stating that the company had failed to prevent the issuing of fraudulent invoices. The case questioned who is liable to pay the VAT on fraudulent invoices when they are issued by an employee without the employer’s knowledge and consent. The Court held that VAT cannot be payable by the company if it acted in good faith and the tax authorities are aware of the person who issued the invoice. The employer needs to exercise due diligence to prevent the employee from using its identification details to issue fake invoices. If the employer did exercise due diligence, then the employee must be considered liable for the VAT. This case emphasizes the importance of businesses implementing measures to prevent employee fraud and avoid liability for VAT due to such fraud.
Source EY
See also
- C-442/22 (P Sp. z o.o.) – Judgment – Employee who issued empty invoice is responsible to report them
- Roadtrip through ECJ Cases – Liability to pay VAT – VAT shall be payable by any person who enters the VAT on an invoice (Art. 203)
- Join the Linkedin Group on ECJ VAT Cases, click HERE
- VATupdate.com – Your FREE source of information on ECJ VAT Cases
