VAT exemptions. What is worth knowing about this issue?

Value Added Tax is considered by entrepreneurs to be one of the most difficult taxes. Fortunately, we also have good news. It is possible to obtain a VAT exemption. What is a VAT exemption and who can benefit from it? If you are looking for an answer to this question, be sure to read our how-to article. Enjoy reading!

What is a VAT exempt?

What is VAT exemption? The answer to this question is very simple. Value Added Tax is charged on the following economic transactions:

• supply of goods,
• provision of services.

These activities may be provided in the country, within the European Union or in countries outside the EU.

Value Added Tax is an important part of the Member States incomes in the European Union. It means that governments pay great attention to whether companies account for their tax in a proper way.

Exempt VAT items. What is it?

VAT exemptions are products and services provided by enterprises that are not subject to VAT. The legal provisions on Value Added Tax include, among others, such VAT exemptions:

• educational and training services,
• financial products, credits, loans,
• insurance,
• fundraisers organized by charities,
• membership fees for organizations,
• sale of wood,
• rental of buildings.

If you sell the above-mentioned goods or services, you cannot charge VAT on the sale. This principle also works the other way around. For example, when you buy insurance services (as you can see, they are exempt from value added tax) you cannot deduct VAT.

Of course, you have to remember that if you want to apply for the exemption, you have to carefully study the VAT regulations. You should check if there are any exceptions to the VAT exemption.

Your business may be partially or fully exempt from value added tax. If you are partially exempt, you must keep detailed VAT records.

Value Added Tax exemptions in various Member States of the European Union

It is worth noting that the provisions on Value Added Tax are various in different EU Member States. This means that if you intend to conduct transactions abroad, you should seek the help of a tax advisor. It means that the list of goods exempt from VAT is different in Poland, and different in Poland, France, etc.

VAT exemption. The help of specialists is a good idea

If you are a VAT payer and want to obtain a VAT exemption, you must remember about the applicable regulations. If you act contrary to the regulations, you will be required to return any unpaid tax with interest. Keep this in mind, as the tax office will thoroughly check that your VAT exemption is correct

To avoid the above-mentioned troubles, you should enlist the help of experienced tax specialists. It is worth choosing a consulting company that is reputable and has many years of experience. Polishtax.com is one of these advisory companies. The advantage of Polishtax.com is the well-qualified staff and a wide range of services. Employees will check whether you are eligible for a VAT exemption and keep your tax documentation properly.