The provisions of the Goods and Services Tax Act contain specific regulations on the taxable person for agricultural holdings.
Article 15(4)(5) the said Act provides that in the case of natural persons operating only an agricultural, forestry or fishing holding, the person who submits the registration declaration referred to in Article 96(1).
Provision section 4 apply mutatis mutandis to natural persons engaged exclusively in agricultural activities other than those mentioned in section 4 cases.
That provision assumes that, in the case of the holding of several persons, only the person who made the registration declaration as an active VAT taxable person shall be regarded as a VAT taxable person.
Other persons operating a common agricultural holding may be regarded as a taxable person only in respect of an economic activity going beyond the agricultural activity specified in the statutory dictionary — Article 2(15)(21) with regard to Annex 2 to the VAT Act.
In the case of marriage, only an agricultural holding or other agricultural activity if one has already filed a registration application as an active VAT taxable person, second the spouses may be a VAT taxable person only if they are engaged in an economic activity beyond the scope of the agricultural activity in question.
NSA position
This understanding of this provision was confirmed by the Supreme Administrative Court in its recent judgment of 10 April 2018, reference no. I FSK 1005/16.
The subject of the decision was a cassation complaint from the WSA judgment in Warsaw to the decision of the Director of the Tax Chamber in Warsaw with 30 June 2015 on the tax on goods and services. The case concerned spouses operating an agricultural holding in which the VAT taxable person 1 May 2009 was the husband of the Complainant.
On 30 July 2012 The applicant lodged a registration declaration in respect of the goods and services tax (VAT-R), giving up the entity exemption referred to in Article 113(1)(9) VAT Act dated 1 August 2012 As an overriding activity, it indicated the rental and lease of agricultural machinery and equipment.
The tax authority refused to deduct the applicant from the purchase invoices for tractors and agricultural machinery purchased in connection with his business.
It pointed out that the applicant is not an active VAT taxable person, despite the VAT-R registration declaration and therefore the goods and services purchased are not in any way linked to the performance of the taxed activities by the applicant.
On the other hand, the NSA found that the Applicant, according to the content Article 108(1) VAT Act . – is obliged to pay the tax on the goods and services shown in the invoices of the sale of agricultural services which it has issued unlawfully.
Separation of the VAT of spouses possible outside the activity
Both the Provincial Administrative Court and the Supreme Administrative Court agreed with the ruling of the tax authority.
The courts considered that the activities of the Complainant consisting in renting agricultural machinery and equipment are not a separate economic activity from the activities of the agricultural holding carried out in marriage.
The NSA indicated in its statement of reasons that the standards Article 15(4)(5) Act on 11 March 2004 the tax on goods and services shall be understood to mean that, in the case of a marriage, only an agricultural holding or other agricultural activity, if one has already made a registration application as an active VAT taxable person, second of the spouses may be a VAT taxable person only in the event of a business going beyond the agricultural activity in question as defined in Article 2(15) U.P.T.U.
Author:
Marcin Kołkowicz
Tax advisor, tax consultant at Russell Bedford Poland Sp. z o.o., graduate of the Administration, Management and Marketing of the Catholic University of Lublin named after John Paul II. The subject of tax law deals with from 2012. He gained experience in Lublin and in Warsaw tax advisory offices. Author and co-author of many tax publications, in particular for Tax and Tax Portal TaxFin.pl. In his career, he dealt with both direct and indirect taxation issues, with particular emphasis on VAT.