- Re-invoicing involves reselling a service without adding a margin, typically at cost.
- Conditions for re-invoicing include purchasing a service in one’s name for another entity, the other entity being the actual beneficiary, and a direct link between service and payment.
- Under the VAT Act, re-invoicing is considered the supply of services.
- Reimbursement of costs is not re-invoicing if expenses are incurred for the entity that paid them and serve as compensation or damages.
- Such reimbursements are not subject to VAT as no service is rendered.
- Article 29a(7)(3) of the VAT Act covers reimbursement of documented expenses incurred on behalf of another, not subject to VAT.
- The Supreme Administrative Court ruled that cost reimbursement is not always documented by re-invoice.
- A case involved a former shareholder reimbursing a company for advisory service costs.
- The court ruled the company was the beneficiary of the services, not the shareholder, and reimbursement was not a taxable service.
Source: mddp.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.
