Taxation Rules for In-Group and Out-Group Transactions in VAT Groups

• A VAT Group consists of entities in the same Member State that are financially, economically, and organizationally connected.
• Member States can introduce VAT Groups as per Article 11 of Council Directive 2006/112/EC.
• Poland implemented VAT Group provisions starting 1 January 2023.
• A VAT Group acts as a single VAT taxpayer, and individual members lose their separate VAT taxpayer status.
• Transactions within the VAT Group are not subject to VAT.
• Transactions with entities outside the group are taxable, with the VAT Group being the taxpayer.
• Purchases by individual members are attributed to the entire VAT Group.
• Transactions between a company and its foreign branch are not subject to VAT as the branch is not a separate VAT taxpayer.

Source: krgroup.eu

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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