Case study 04

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Q: Due to the adopted conditions of complaints, any corrective invoice issued by the Romanian company for returning the goods by the customer would cause the automatic correction of invoice of Polish company to Romanian company. Is it acceptable in the buy-sell model, maintaining the same method for the price adjustment? If so, what appropriate price adjustment terms should be included in the agreement between Polish company and Romanian company?

A: According to Instructions to apply the simplified methods for VAT in case of returns of goods in EU approved by Order 102/2016, if Poland applies the same, in case of return of goods from the Romanian subsidiary to the Polish company, it is considered the intercommunity sale from Poland to Romania and the intercommunity purchase in Romanian from Poland never took place. In conclusion the Polish company should issue a corrective invoice, indicating the original invoice subject to corrections. The price adjustments should be calculated using the same approach.