KSeF “National System of e-Invoices”

The mandatory KSeF will go into effect on July 1, 2024, and for VAT-exempt companies on January 1, 2025. Below are the general assumptions and selected, most relevant elements of the system.

ALERT! The Ministry of Finance has postponed entry of obligatory KSEF into force. Read more here.

Assumptions of KSeF system

The National e-Invoice System (KSeF) is a central IT system managed by the Ministry of Finance, introduced for the electronic transmission of invoices between businesses in Poland.

The KSeF is a platform that enables the generation, sending, receiving, and storing of invoices in electronic format. The system was created to increase the efficiency and transparency of the invoicing process, reduce administrative burdens, and limit the shadow economy.

The key assumptions of the system are as follows:

• Electronic exchange of invoices: KSeF aims to replace traditional paper-based invoice exchanges between businesses with an electronic format. The system allows for the generation, transmission, receipt, and storage of invoices in electronic format.
• Simplification and standardization of the invoicing process: KSeF introduces
  a standardized electronic format for invoices that must be used by participants in the system. This streamlines the invoicing process and ensures data consistency, enabling automatic verification and processing of invoices.
• Ensuring security and authenticity: KSeF is based on a public key infrastructure, which ensures secure transmission of invoices and authentication of participants. Invoices are digitally signed, guaranteeing data integrity and authenticity.
• Electronic archiving: KSeF allows for the electronic storage of invoices for a specified period of time. Participants in the system have access to their invoice archives, facilitating document management and audits.
• Reduction of administrative burdens: KSeF aims to reduce administrative burdens associated with the invoicing process by eliminating the need to print, send, and store paper invoices. The simplification and automation of the process are intended to save time and costs for businesses and public administration.
• Expanding digitization: KSeF is part of a broader initiative to digitize accounting and tax settlement processes in Poland. The system aims to support digital transformation and the use of modern technologies in the exchange of documents and data between economic entities and the government.

Implementing the KSeF will require taxpayers to invest a significant amount of time to analyze existing business processes and upgrade of invoicing-related IT systems.

Entities covered by KSeF

Domestic Entities – all entities domiciled in Poland will be obliged to implement and use the KSeF.

According to the adopted bill, the KSeF excludes invoices issued to consumers (i.e., B2C). Taxpayers will have to issue them in the current form, which requires appropriate adjustment of processes to accommodate different methods of invoicing – different for domestic recipients who are entrepreneurs and different for consumers.

Foreign Entities – the obligation to use the KSeF will also apply to foreign entities that have a fixed establishment for VAT purposes in Poland, in scope of transactions covered by Polish VAT regulations.

If:

• the buyer is an entity from another EU member state or a third country (non-EU),
• the purchaser is an entity that does not have a place of business or a permanent place of business in Poland,

– the structured invoice is made available to the purchaser in a manner agreed with them (e.g., in pdf form via e-mail). This is due to the fact that they will not have access to the KSeF.

Structured invoice

A structured invoice is an invoice issued in the KSeF. It is currently one of the permitted forms of documenting transactions alongside paper invoices and the electronic invoices that are used in business trading.

With few exceptions, as of July 1, 2024, the structured invoice will be the only form of documenting sales. A structured invoice is defined as an invoice issued using the KSeF with an assigned identification number (KSeF number) of this invoice in this system.

Issuing a structured invoice

A structured invoice can be issued directly using commercial financial and accounting software. These invoices will then be sent to the KSeF via the API. The Ministry of Finance also provides a free tool (KSeF Taxpayer Application) which makes it  possible to issue
a structured invoice.

Forwarding the invoice to the contractor in another form (after sending it to the KSeF)

If the purchaser of goods or services has agreed to receive structured invoices and the invoice has been issued in the KSeF, the seller can additionally (after sending the invoice to the KSeF) provide the customer with a printout of this invoice or send it, for example, by email as a pdf file.

Forwarding of invoice attachments

When a structured invoice is issued in the KSeF, it will automatically be made available to the purchaser, who will be able to download it and post it in their accounting system. Unfortunately, the KSeF does not allow any additional documents to be provided to the purchaser, such as specifications, protocols, orders, etc. These additional documents will have to be made available to the purchaser by other means, such as by email in the form of
a pdf file. Then it will be important and problematic to link these additional documents to the issued structured invoice.

Invoice rejected by the KSeF If the invoice is rejected by the KSeF, it is assumed that the invoice has not been issued. Such a document will not be assigned an identifying number in the system and, consequently, cannot be considered a structured invoice until it is resubmitted to the KSeF. The resubmitted invoice will be considered issued on the date of its resubmission to the KSeF and a number will be assigned to identify this invoice in the KSeF.

Acceptance of purchase invoices in the KSeF

When your supplier issues sales invoices in the KSeF, the system does not provide
a procedure for accepting them. This means that in the case of misidentification of the purchaser, entering a wrong amount or other errors on the invoice, it is necessary to act outside the KSeF system, i.e. to contact the supplier to clarify the situation and for him to issue an appropriate correcting invoice.

Issuing correcting invoices in the KSeF The KSeF also allows for issuing correcting invoices. A structured invoice issued in the KSeF can only be corrected by a structured correcting invoice. The correcting invoice issued in the KSeF should contain the KSeF number of the original invoice (the ‘NrKSeFFaKorygowanej’ field). The original invoice issued outside the KSeF cannot be adjusted within the KSeF.

KSeF application

The KSeF Taxpayer Application allows taxpayers and entities authorized by those taxpayers to issue, receive and view e-invoices. The application also has additional functionality to facilitate the handling of e-Invoices (previewing, downloading e-Invoices to a local drive, verifying the status of e-Invoice shipment, downloading the Official Certificate of Receipt (UPO)) and managing permissions and tokens. In addition, the application allows users to preview the e-Invoice without logging in (anonymous access to the e-Invoice after indicating its individual characteristics), as well as to verify the shipping status and the possibility of downloading the KSeF UPO.

In most cases, the KSeF application will be used to manage permissions, i.e. to grant and receive permissions and generate a token. Issuing sales invoices and receiving purchase invoices will most often be done using existing commercial accounting and billing systems.

In the event of a KSeF failure or in case of problems on the taxpayer’s side (e.g., internet failure), businesses will be able to issue invoices offline (according to the structured invoice template). In such a situation, the taxpayer will have to stamp such a document with
a verification code and send it to the buyer in a manner agreed with him.
Once the system failure is over, such an invoice will have to be submitted to the KSeF within seven business days. However, in case of problems on the taxpayer’s side, this will have to be done no later than the next business day after the offline document is issued.

KSeF permissions

The National e-Invoice System (KSeF) is based on a credential model, i.e. authentication and authorization of a person in the system is required. Once authenticated in the system, the taxpayer uses KSeF to view, issue and receive structured invoices. In addition to the taxpayer, an entity authorized by that taxpayer may use the system. It is also possible to assign the permission to use KSeF e.g. to an accounting office or a particular natural person.

There are the following permissions in the KSeF:

• to grant, change or revoke KSeF authorizations,
• to issue or access structured invoices,
• to issue invoices in KSeF under the self-invoicing procedure.

Natural persons who are VAT taxpayers – in accordance with the provisions of the law, every natural person who is a VAT taxpayer in Poland is authorized to use the KSeF. All they need to do is log in to the KSeF application with a Trusted Profile or qualified electronic signature.

Legal entities – in the case of legal entities, in order to access the KSeF application, it is necessary to complete the ZAW-FA form and submit it to the Tax Authority. It indicates a specific person who will have access to the KSeF. That person will be able to send invoices and grant and revoke permissions to others.

KSeF token

The authorization token is a special way of logging into the KSeF system. It allows for communication of external systems (invoicing software) with the KSeF application. Once generated, the token is subject to registration in an external system. As a result, in order to send an invoice to the KSeF or download purchase documents from the system, no additional user login to the KSeF is required.

A token is a 64-digit string of characters assigned to a specific entity and a specific range of authorizations.

When generating a token, the extent of authorization can be specified:

• to issue invoices,
• to review invoices (download purchase invoices),
• both of these activities.

KSeF number

A structured invoice is defined as an invoice issued using KSeF with an assigned identification number (KSeF number) of this invoice in this system.

KSeF number consists of 32 digits and includes, among other things, the vendor’s TIN and the date the file was uploaded to KSeF, which is formally considered the date the e-invoice was issued.

The KSeF number is shown on the invoice next to the standard invoice number. It is important that after the change in the regulations, a sales document without a KSeF number assigned to it will not be treated as a VAT invoice.

Entry into force

The KSeF system was introduced in Poland from January 1, 2022 on a voluntary basis. Currently, an e-invoice issued under the KSeF operates as one of the permitted forms of documenting sales, in addition to paper invoices and electronic invoices already present in business trading.

Mandatory use of the KSeF will begin on July 1, 2024.

Our support

If you are looking for support in implementing KSeF or looking for a billing system that meets your new requirements then contact us. We are here to make running your business easier.