Polish tax obligations generally expire after five years, yet suspensions and time limits on invoice corrections often allow tax authorities to revisit old invoices.
The 5-Year Rule for Tax Expiration
Polish law provides for the expiration of tax payment obligations along with interest after a statutory period. Generally, tax liabilities expire after five years, counting from the end of the calendar year in which the tax payment deadline fell (Art. 70 § 1 of the Tax Ordinance).
Suspension and Termination of the Statute
The introduction of the five-year statute aims to protect taxpayers from unlimited intervention by national tax authorities. However, as reported by Prawo.pl, this five-year period still grants the tax administration broad scope for action, and businesses often learn of alleged irregularities only years after issuing an invoice.
The statute of limitations can be – and frequently is – interrupted or suspended. According to Art. 70 § 4 of the Tax Ordinance, the statute is interrupted by the application of an enforcement measure of which the taxpayer was notified. Conversely, Art. 70 § 6 states that the statute is suspended in cases such as:
The Trap of Inability to Correct Invoices
As a result, a taxpayer can become subject to administrative action even after many years, the service reports. An additional problem is the limited time to correct an invoice. According to case law, errors in accounting documents can only be rectified before the statute of limitations expires, a principle confirmed by judicial precedent.
In practice, if the tax office challenges an invoice issued by the taxpayer, the taxpayer will no longer have the opportunity to issue a correction – reports Prawo.pl. Crucially, if the tax authority challenges an invoice after the statute of limitations expires, and you failed to correct it, a minor mistake can escalate into serious tax criminal problems.
The Principle of Resolving Doubts in Favor of the Taxpayer
Although Poland applies the principle of resolving doubts in favor of the taxpayer, it is important to be aware that it does not protect in all circumstances. When? The inability to correct an invoice – the biggest pitfall of tax expiration.
In practice, the tax office can return to documents from many years prior, and complex rules on suspending the statute of limitations make the expiration period often illusory. As the service emphasizes, the biggest threat to taxpayers is not the tax audit itself, but the inability to correct a faulty invoice and rectify incorrect filings.
