Invoicing foreign clients from Poland

Many people who run a JDG in Poland work for clients abroad. Examples are a software contractor with a client in Germany, a designer with a studio in the UK, and a consultant with a company in the US. This guide answers the main questions about invoices to these clients from Poland.

Read this warning first. The VAT and income tax treatment of an invoice to a foreign client depends on the case. These factors decide the treatment:

• the country of the client;
• whether the client is a business;
• the type of service or goods;
• your own VAT status.

This guide explains the terms and the usual steps. It is not tax advice. Ask your accountant about your situation.

Which currency to invoice in

You and your client can agree to use a foreign currency, such as EUR, USD or GBP. Many foreign clients prefer their own currency. It also keeps your price stable for them.

Polish bookkeeping uses the złoty. For tax purposes, you convert the foreign amounts to PLN with an exchange rate. The invoice can also show the PLN amounts where VAT applies.

The NBP rate

In many cases, the conversion uses the average rate from table A of the National Bank of Poland (NBP). Use the rate for the last business day before a specified date. For a sale, this date is generally the date of the sale. It is the date of the transaction or the date of the invoice, depending on the rule that applies.

Fiskora applies the NBP table A rate from the last business day before the sale date. These are the details:

• “Last business day before” means the working day before the date. It does not include weekends and public holidays.
• Show the rate and its date on the invoice. Then a person who checks the document can follow your numbers.

The rules can be different in some situations. For example, you can choose a different conversion method, or your accountant can use other dates. Ask your accountant which method they expect.

Reverse charge and “odwrotne obciążenie”

You can sell services to a business in another EU country. In the usual case, you do not charge Polish VAT. The buyer accounts for the VAT in their own country. This is the reverse charge. In Polish, the invoice wording is typically odwrotne obciążenie. In English, the wording is “reverse charge”.

Note these points:

• The invoice normally has a note that the reverse charge applies. In Polish, the note is odwrotne obciążenie. In English, the note is “Reverse charge”.
• The invoice usually shows no Polish VAT amount. It shows the EU VAT number of the client.
• Other supplies can have different wording or a different legal basis, for example services to non-EU clients. Some sales are completely outside the scope of Polish VAT. Some goods follow different rules.

Fiskora supports reverse charge and services to foreign clients on invoices. You and your accountant decide which wording and which VAT treatment apply to your sale. Do not copy wording from another invoice before you check that it is correct for your sale.

Checking the client with VIES

VIES is the EU system that checks if a VAT number is valid. For sales to EU businesses, check the VAT number of the buyer before you issue the invoice. The VAT treatment often depends on the client being a business with a valid number.

Fiskora has a VIES lookup. Enter the EU VAT number of the client. Fiskora then checks the number. Keep a record of the check, for example a screenshot or a saved confirmation. Your accountant can ask for it.

A VIES check shows only if a number is valid at that time. It does not show the correct VAT treatment.

The MF VAT whitelist

The Ministry of Finance publishes a VAT whitelist (biała lista). It lists registered taxpayers and their bank accounts. This list is for Polish clients and suppliers. Fiskora includes a lookup. It is more relevant to Polish counterparties than to foreign counterparties. It is also useful if you have Polish clients.

A bilingual invoice

Your client abroad can be unable to read Polish. Your accountant and the tax office read Polish. A bilingual invoice solves both problems. Fiskora produces a PDF in Polish and English. Labels such as seller, buyer, quantity and total are in both languages. The client understands the invoice, and the Polish side can read it.

The bilingual PDF does not change the language of the structured invoice in KSeF. The structured invoice uses a standard format. The PDF is the readable version that you send by email.

KSeF and foreign clients

KSeF is a Polish system. Invoices to Polish buyers go through it. A foreign buyer usually has no access to KSeF. Send a PDF to this buyer by email. These points depend on the case:

• if a specific invoice to a foreign client must go through KSeF;
• how the invoice is marked;
• what you record.

Ask your accountant, particularly for the first few invoices.

Payment details

Put clear payment details on the invoice:

• the amount and the currency;
• your IBAN and SWIFT/BIC if the client pays by bank transfer;
• the payment term or due date.

Banks in the country of the client can take a few days. Consider the fees at both ends. A foreign client sometimes pays by transfer from a bank where the fees go to one side. Agree who pays the fees.

Step by step in practice

1. Check if the client is a business. For EU clients, check the VAT number in VIES.
2. Choose the invoice currency.
3. Enter the sale date. The rate comes from the last business day before this date.
4. Select the VAT treatment that your accountant tells you to use. Include the reverse charge note where it applies.
5. Issue the invoice. Send it to KSeF if this is required. Email the bilingual PDF to the client.
6. Keep the UPO and the VIES record with the invoice.

Mistakes to avoid

• Do not use the wrong date for the NBP rate.
• Do not use reverse charge for a client that is not a business or has an invalid VAT number.
• Do not copy wording from a template before you check that it is correct for your sale.
• Do not forget that the correction process also uses the currency and rate logic.

Ask your accountant

Pay particular attention to these questions. Ask them before your first foreign invoice:

• What VAT treatment applies to this client and service?
• What wording and legal basis must appear on the invoice?
• Which exchange rate and date do I use for my tax records?
• Do I need to file additional reports for EU sales?

When you have the answers, use the same method for each repeat client. Then you do not need to think about it again.