As of 1 July 2024, the provisions implementing the DAC7 Directive into the Polish legal order are in force. The provisions of DAC7 are aimed at tightening the tax systems of Member States and preventing the creation of grey areas in the e-commerce industry. These objectives are to be achieved by the imposition of obligations to collect and report to the tax administration specific information on sellers who have carried out the relevant activities through digital platforms, and failure to fulfil these obligations will be punished with a high financial penalty.

Who will have the new responsibilities?

The new obligations will primarily affect digital platform operators, but also their users. Importantly, the regulations are not limited to platform operators who are resident for tax purposes in Poland - the new obligations cover both entities with tax residency in a Member State and entities from outside the EU.

The construction of the DAC7 provisions means that they can be interpreted very broadly. Thus, it may be difficult for many platform operators and e-commerce participants to correctly determine whether the provisions also apply to their business. This may be the case, for example, for digital platforms that do not facilitate business transactions strictly speaking, but focus on other types of activities, the main purpose of which is not necessarily commercial.

Digital platforms

According to the DAC7 regulations, entities that provide vendors (sellers) with a platform or part of a platform (so-called platform operators) are covered by the reporting obligation. Whereby a platform is to be understood broadly as:

  • software, including a website or part thereof,
  • applications, including mobile applications,

which allow vendors to connect with other users in order to perform a relevant activity. Such a definition is not self-evident and first requires an analysis of the model that is realized using a particular software / portal / application. It is necessary to examine whether, within this model, it is possible to identify a "vendor" and, consequently, a "relevant activity" within the meaning of the DAC7 rules.

Users of Digital Platforms

Vendors being users of the platform (individuals or businesses) who use the platform to perform activities for remuneration are subject to the DAC7 reporting. The categories of users covered by the DAC7 regulations include:

  • sellers of goods who carry out transactions on digital platforms,
  • landlords of real estate, including residential property,
  • personal service providers - performed on demand, online or physically,
  • providers of means of transport (e.g. cars, bicycles, electric scooters).

Vendors are obliged to provide the platform operator with the information required to fulfil the reporting obligations - if they fail to cooperate, the platform operator should withhold payment to the vendor until this information is provided.

We point out that for reporting obligations to exist, it is necessary to identify an 'active vendor' who has performed the relevant activity through the platform in a given year. However, it is irrelevant under which name the user appears in the respective collaboration model.

In this context, it is worth noting that the issue of the "remuneration" due to the platform user for the performance of the relevant activity also requires an in-depth analysis. The rules indicate that the payment of remuneration may take place in any form and in connection with the performance of the relevant activity, so questions may arise as to possible reporting obligations in case the link between the payment and the relevant activity is not clear or difficulties arise in determining the monetary value of the payment itself.

Exemptions from new obligations

It is worth remembering that the regulations also provide for exemptions from the reporting obligation - specified both for platforms and its users (vendors). Information in this respect may prove important from the perspective of those entities that perform 'occasional' activities or activities with 'symbolic' values, as the DAC7 rules provide that platform users who performed less than 30 relevant activities in a year are excluded from mandatory reporting if the remuneration of such users did not exceed EUR 2,000.

The new obligations also do not apply to platforms that only enable:

  1. publishing offers or announcements,
  2. redirecting or transferring users to sales platforms,
  3. payment processing (e.g. payment institutions).

Platform operators and users must fulfil the new requirements correctly to avoid sanctions and ensure compliance. Admittedly, the deadline for the first reporting is 31 January 2025, but certain obligations should already be fulfilled by 31 December 2024, so there is still some time left to review the DAC7 requirements and plan further actions. If the analysis does not provide a clear answer, it may be worth considering applying to the Director of National Tax Information for an individual tax ruling to confirm the DAC7 reporting obligations.