Provisional text

JUDGMENT OF THE GENERAL COURT (Chamber giving preliminary rulings)

11 February 2026 (*)

( Reference for a preliminary ruling – Taxation – Common system of VAT – Right to deduct input VAT – Article 167, Article 168(a) and Article 178(a) of Directive 2006/112/EC – Issuing of the invoice showing the VAT during the tax period following that in respect of which the right of deduction is exercised – Fiscal neutrality and proportionality )

In Case T‑689/24,

REQUEST for a preliminary ruling under Article 267 TFEU from the Naczelny Sąd Administracyjny (Supreme Administrative Court, Poland), made by decision of 2 October 2024, received at the Court on 10 December 2024, in the proceedings

I. S.A.

v

Dyrektor Krajowej Informacji Skarbowej,

THE GENERAL COURT (Chamber giving preliminary rulings),

composed, at the time of the deliberations, of S. Papasavvas, President, N. Półtorak, M. Sampol Pucurull, G. Steinfatt (Rapporteur) and D. Petrlík, Judges,

Advocate General: J. Martín y Pérez de Nanclares,

Registrar: M. Zwozdziak-Carbonne, Administrator,

having regard to the transmission of the request for a preliminary ruling to the General Court by the Court of Justice on 8 January 2025, pursuant to the third paragraph of Article 50b of the Statute of the Court of Justice of the European Union,

having regard to the fact that the case concerns the area referred to in point (a) of the first paragraph of Article 50b of the Statute of the Court of Justice of the European Union and the fact that there is no independent question relating to interpretation within the meaning of the second paragraph of Article 50b of that statute,

having regard to the written part of the procedure,

further to the hearing on 28 October 2025,

after considering the observations submitted on behalf of:

–        I., by T. Michalik and J. Warnieło, doradcy podatkowi,

–        Dyrektor Krajowej Informacji Skarbowej, by M. Kowalewska and T. Tratkiewicz,

–        the Polish Government, by B. Majczyna, acting as Agent,

–        the European Commission, by P. Carlin and M. Owsiany-Hornung, acting as Agents,

having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,

gives the following

Judgment

1        This request for a preliminary ruling concerns the interpretation of Article 167, Article 168(a) and Article 178(a) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax (OJ 2006 L 347, p. 1; ‘the VAT Directive’), and of the principles of neutrality of value added tax (VAT), effectiveness and proportionality.

2        The request has been made in proceedings between I. S.A. and Dyrektor Krajowej Informacji Skarbowej (Director of the National Revenue Information Service, Poland; ‘the tax authority’), concerning an advance tax ruling in relation to the deduction of VAT on supplies of gas and electricity to I., appearing on invoices received by I. during the tax period following that during which the purchase had been made.

 Legal framework

 European Union law

3        Article 63 of the VAT Directive provides:

‘The chargeable event shall occur and VAT shall become chargeable when the goods or the services are supplied.’

4        Title X of the VAT Directive, concerning deductions, includes Chapter 1, entitled ‘Origin and scope of right of deduction’, which is composed of Articles 167 to 172 of that directive. Article 167 of that directive provides:

‘A right of deduction shall arise at the time the deductible tax becomes chargeable.’

5        Article 168 of the VAT Directive provides:

‘In so far as the goods and services are used for the purposes of the taxed transactions of a taxable person, the taxable person shall be entitled, in the Member State in which he carries out these transactions, to deduct the following from the VAT which he is liable to pay:

(a)      the VAT due or paid in that Member State in respect of supplies to him of goods or services, carried out or to be carried out by another taxable person;

…’

6        Chapter 4 of Title X of the VAT Directive, entitled ‘Rules governing exercise of the right of deduction’, contains Articles 178 to 183 of that directive. Under Article 178 of that directive:

‘In order to exercise the right of deduction, a taxable person must meet the following conditions:

(a)      for the purposes of deductions pursuant to Article 168(a), in respect of the supply of goods or services, he must hold an invoice drawn up in accordance with Sections 3 to 6 of Chapter 3 of Title XI;

…’

7        The first paragraph of Article 179 of the VAT Directive provides:

‘The taxable person shall make the deduction by subtracting from the total amount of VAT due for a given tax period the total amount of VAT in respect of which, during the same period, the right of deduction has arisen and is exercised in accordance with Article 178.’

8        Title XI of the VAT Directive, concerning the obligations of taxable persons and certain non-taxable persons, includes Chapter 5, entitled ‘Returns’, which is composed of Articles 250 to 261 of that directive. Article 250(1) of that directive provides:

‘Every taxable person shall submit a VAT return setting out all the information needed to calculate the tax that has become chargeable and the deductions to be made including, in so far as is necessary for the establishment of the basis of assessment, the total value of the transactions relating to such tax and deductions and the value of any exempt transactions.’

9        The first paragraph of Article 273 of the VAT Directive provides:

‘Member States may impose other obligations which they deem necessary to ensure the correct collection of VAT and to prevent evasion, subject to the requirement of equal treatment as between domestic transactions and transactions carried out between Member States by taxable persons and provided that such obligations do not, in trade between Member States, give rise to formalities connected with the crossing of frontiers.’

 Polish law

10      Article 86(1) of the ustawa o podatku od towarów i usług (Law on tax on goods and services) of 11 March 2004 (Dz. U. of 2018, item 2174), as amended (‘the Law on VAT’), provides:

‘In so far as goods and services are used to conduct taxable transactions, a taxable person within the meaning of Article 15 shall have the right to deduct the amount of input tax from the amount of tax due, subject to Article 114, Article 119(4), Article 120(17) and (19) and Article 124.’

11      According to Article 86(10) of the Law on VAT:

‘The right to deduct the amount of input tax from the amount of tax due shall arise when the tax is settled for the period in which the tax liability arose in relation to the goods and services acquired or imported by the taxable person.’

12      Article 86(10b) of the Law on VAT states:

‘The right to deduct the amount of input tax from the amount of tax due in the cases referred to in:

(1)      paragraph 2(1) and (2)(a) – shall arise no earlier than when the tax is settled for the period during which the taxable person received the invoice or customs document ;

…’

 The dispute in the main proceedings and the question referred for a preliminary ruling

13      I., a company subject to VAT in Poland, operates a clearing and settlement house for transactions carried out by its members, inter alia concerning gas and electricity. In the course of its activities, it is regarded as the purchaser and reseller of goods involved in stock exchange transactions and appears as such on the invoices. It is therefore obliged to pay input and output VAT.

14      I. requested an advance tax ruling from the tax authority concerning VAT, in order to ascertain whether it had the right to deduct the input tax indicated on the properly issued invoices for the purchase of gas and electricity, under Article 86(1) and (10) of the Law on VAT, although it had received the invoices documenting the purchase in the given tax period in the following tax period, but no later than the deadline by which it had submitted its tax return.

15      In an advance tax ruling of 12 November 2019, the tax authority found that the exercise of the right of deduction was subject, both under Polish law and under EU law, to the satisfaction of formal conditions, inter alia, the receipt of an invoice. According to the tax authority, those conditions did not, however, deprive the taxable person of the right to deduct input VAT and thus did not infringe the principle of VAT neutrality.

16      Hearing an action against that advance tax ruling, the Wojewódzki Sąd Administracyjny w Warszawie (Provincial Administrative Court, Warsaw, Poland), by judgment of 9 October 2020, dismissed I.’s claims, holding, inter alia, that the right to deduct input tax is in general linked with the time at which VAT becomes chargeable, namely the time at which the tax liability arises. However, according to that court, in order for a taxable person to exercise his or her right of deduction, two conditions must be satisfied, namely that the transaction must have actually taken place and that the taxable person must hold an invoice documenting the transaction. According to the Wojewódzki Sąd Administracyjny w Warszawie (Provincial Administrative Court, Warsaw), the time at which the right to deduct input tax arises, provided for in Article 167 of the VAT Directive, is thus modified in practice by the formal condition laid down in Article 178(a) of that directive, consisting in the holding of the corresponding invoice. According to that court, it follows that the right to deduct input tax arises, subject to the other conditions being satisfied, at the time that invoice is received.

17      I. brought an appeal on a point of law against the judgment of 9 October 2020 before the Naczelny Sąd Administracyjny (Supreme Administrative Court, Poland), which is the referring court, alleging, in particular, a misinterpretation of Article 167, Article 168(a) and Article 178(a) of the VAT Directive.

18      The referring court has doubts regarding the possible incorrect transposition of Article 167, Article 168(a) and Article 178(a) of the VAT Directive into national law. According to the referring court, Article 86(10b)(1) of the Law on VAT sets out an additional condition for the right to deduct to arise as opposed to the VAT Directive, namely the need to hold an invoice or customs document at the date the tax is settled.

19      In the present case, the effect of applying Article 86(10b)(1) of the Law on VAT, according to the referring court, is that the right of deduction is delayed. In the view of that court, where the seller has already paid the VAT due on a transaction to the State budget, the purchaser – in order for the right of deduction to arise – is obliged to wait until such time as he or she receives the corresponding invoice.

20      The referring court considers that, in accordance with EU law, it must be possible to deduct input tax for a given tax period where the right to deduct arose during that period and where, moreover, the taxable person holds an invoice or customs document at the time that he or she exercises that right. It considers that such an interpretation allows the taxable person to exercise his or her right to deduct input tax without undue delay, and without creating a risk of abuse. It explains that a deferral of the deduction of VAT may directly affect whether there is an infringement of the principle of neutrality and is not directly supported by the wording of the VAT Directive.

21      In those circumstances the Naczelny Sąd Administracyjny (Supreme Administrative Court) decided to stay the proceedings and to refer the following question to the Court of Justice for a preliminary ruling:

‘Must Articles 167, 168(a) and 178(a) of [the VAT Directive] and the principles of fiscal neutrality, effectiveness and proportionality be interpreted as precluding a provision of national law, such as Article 86(10b)(1) of [the Law on VAT], under which a taxable person may not assert [his or her] right to deduct input tax in a return submitted for a period in which [he or she satisfied] the substantive conditions for exercising that right if, during that period, he or she had not yet received an invoice, even though [he or she] did receive the invoice before submitting the return?’

 Consideration of the question referred

22      By its question, the referring court asks whether Article 167, Article 168(a) and Article 178(a) of the VAT Directive and the principles of VAT neutrality, of effectiveness and of proportionality must be interpreted as precluding national legislation under which a taxable person may not assert his or her right to deduct input VAT in a return submitted for a period in which he or she satisfied the substantive conditions for exercising that right if, during that period, he or she had not yet received the corresponding invoice, even though he or she did receive the invoice before submitting the return.

23      According to settled case-law, the right of taxable persons to deduct the VAT due or paid on goods purchased and services received as inputs from the VAT which it is liable to pay is a fundamental principle of the common system of VAT established by EU legislation (see judgment of 12 September 2024, NARE-BG, C‑429/23, EU:C:2024:742, paragraph 45 and the case-law cited).

24      The deduction system is intended to relieve the taxable person entirely of the burden of the VAT due or paid in the course of all his or her economic activities. The common system of VAT therefore ensures that all economic activities, whatever their purpose or results, provided that they are, in principle, themselves subject to VAT, are taxed in a neutral way (see judgments of 15 September 2016, Senatex, C‑518/14, EU:C:2016:691, paragraph 27 and the case-law cited, and of 12 September 2024, NARE-BG, C‑429/23, EU:C:2024:742, paragraph 46 and the case-law cited). The basic principle of the VAT system is that VAT is intended to tax only the final consumer and to be completely neutral as regards the taxable persons involved in the production and distribution process prior to the stage of final taxation, regardless of the number of transactions involved (see judgment of 12 September 2024, Novo Nordisk (VAT – Contributions paid pursuant to an ex lege obligation), C‑248/23, EU:C:2024:735, paragraph 32 and the case-law cited).

25      The right of deduction provided for in Article 167 et seq. of the VAT Directive is an integral part of the VAT scheme and in principle may not be limited if the material and formal requirements or conditions to which that right is subject are respected by taxable persons wishing to exercise it. In particular, that right is normally exercisable immediately in respect of all the taxes charged on input transactions (see judgments of 25 May 2023, Dyrektor Izby Administracji Skarbowej w Warszawie (VAT – Fictitious acquisition), C‑114/22, EU:C:2023:430, paragraph 27 and the case-law cited, and of 12 September 2024, NARE-BG, C‑429/23, EU:C:2024:742, paragraph 47 and the case-law cited).

26      According to Article 167 of the VAT Directive, the right of deduction arises at the time when the deductible tax becomes chargeable, with the tax becoming chargeable, pursuant to Article 63 of that directive, when the goods are delivered or the services are performed (judgment of 25 May 2023, Dyrektor Izby Administracji Skarbowej w Warszawie (VAT – Fictitious acquisition), C‑114/22, EU:C:2023:430, paragraph 31).

27      As stated in paragraph 25 above, the right of deduction is subject to the satisfaction of both substantive and formal conditions provided for by the VAT Directive.

28      The substantive conditions of the right of deduction are those which govern the actual substance and scope of that right, such as those provided for in Chapter 1 of Title X of the VAT Directive, entitled ‘Origin and scope of right of deduction’. Thus, under Article 168(a) of the VAT Directive, goods in respect of which the taxable person intends to assert the right of deduction must have been acquired by him or her in that capacity at the time of acquisition. In addition, those goods must be used by the taxable person for the purposes of his or her own taxed output transactions and those goods must be supplied by another taxable person as inputs (judgment of 15 September 2016, Senatex, C‑518/14, EU:C:2016:691, paragraph 28; see, also, judgment of 14 October 2021, Finanzamt N and Finanzamt G (Communication of the allocation decision), C‑45/20 and C‑46/20, EU:C:2021:852, paragraph 34 and the case-law cited).

29      The formal conditions for the right of deduction regulate the rules governing its exercise and monitoring thereof and the smooth functioning of the VAT system, such as the obligations relating to accounts, invoicing and filing returns (see judgment of 14 October 2021, Finanzamt N and Finanzamt G (Communication of the allocation decision), C‑45/20 and C‑46/20, EU:C:2021:852, paragraph 35 and the case-law cited). In particular, in accordance with Article 178(a) of the VAT Directive, the exercise of the right of deduction is subject to holding an invoice drawn up in accordance with Sections 3 to 6 of Chapter 3 of Title XI of that directive (see, to that effect, judgment of 15 September 2016, Senatex, C‑518/14, EU:C:2016:691, paragraph 29 and the case-law cited).

30      That distinction between the substantive and formal conditions governing the right of deduction is important, since, according to settled case-law, the fundamental principles of VAT neutrality and proportionality require deduction of input tax to be allowed if the substantive requirements are satisfied, even if the taxable person has failed to comply with some of the formal requirements (see, to that effect, judgments of 14 October 2021, Finanzamt N and Finanzamt G (Communication of the allocation decision), C‑45/20 and C‑46/20, EU:C:2021:852, paragraph 36 and the case-law cited, and of 16 February 2023, DGRFP Cluj, C‑519/21, EU:C:2023:106, paragraph 98 and the case-law cited). The Court has also specified that the non-compliance with formal requirements, which may be remedied, is not such as to call into question the proper functioning of the VAT system (judgment of 26 April 2018, Zabrus Siret, C‑81/17, EU:C:2018:283, paragraph 46).

31      It follows from the case-law recalled in paragraphs 28 to 30 above that the origin of the right of deduction may be made subject only to the substantive conditions laid down in the VAT Directive (judgment of 18 March 2021, A. (Exercise of the right of deduction), C‑895/19, EU:C:2021:216, paragraph 45).

32      The right of deduction therefore arises independently of the holding of an invoice, which amounts to only a formal condition for the exercise of that right (see paragraphs 28 to 31 above). By contrast, Article 178 of the VAT Directive provides that that right can be exercised only once the taxable person holds an invoice (judgment of 21 March 2018, Volkswagen, C‑533/16, EU:C:2018:204, paragraph 43).

33      According to the national legislation at issue in the case in the main proceedings, the right to deduct the amount of input VAT from the amount of VAT due arises, at the earliest, when the tax is settled for the period during which the taxable person received the corresponding invoice. Thus, under that legislation, if that invoice was received during the tax period following that during which the taxable transaction occurred, the right of deduction arises during that subsequent period. As the referring court also notes, that legislation therefore establishes an additional condition for the right of deduction to arise, namely the requirement to hold an invoice or customs document at the date the tax is settled in respect of the period for which that right is exercised, even if, on that date, the substantive conditions, including the carrying out of the taxable transaction, were satisfied.

34      It is apparent from the case-law that the right of deduction must, in principle, be exercised during the same period as that during which it has arisen, namely, in the light of Article 167 of the VAT Directive, once the tax becomes due (judgments of 21 March 2018, Volkswagen, C‑533/16, EU:C:2018:204, paragraph 44; of 26 April 2018, Zabrus Siret, C‑81/17, EU:C:2018:283, paragraph 36; and of 21 October 2021, Wilo Salmson France, C‑80/20, EU:C:2021:870, paragraph 84).

35      Contrary to what the Polish Government argues, the opposite conclusion to that referred to in paragraph 34 above cannot be drawn from the judgment of 29 April 2004, Terra Baubedarf-Handel (C‑152/02, EU:C:2004:268). The fact that the Court of Justice held in paragraphs 34 and 38 of that judgment that the right of deduction must, in principle, be exercised in respect of the period during which, first, that right had arisen and, secondly, the taxable person was in possession of an invoice or a document serving as an invoice, is explained by the fact that, in the case which gave rise to that judgment, the applicant in the main proceedings did not hold an invoice or equivalent document at the time when it exercised the right to deduct VAT (judgment of 15 September 2016, Senatex, C‑518/14, EU:C:2016:691, paragraph 39).

36      Unlike the applicant in the main proceedings in the case which gave rise to the judgment of 29 April 2004, Terra Baubedarf-Handel (C‑152/02, EU:C:2004:268), and as was the case for the applicant in the main proceedings in the case which gave rise to the judgment of 15 September 2016, Senatex (C‑518/14, EU:C:2016:691), the taxable person concerned held invoices at the time when it exercised the right to deduct VAT.

37      Moreover, the immediate character of the deduction referred to in paragraph 35 of the judgment of 29 April 2004, Terra Baubedarf-Handel (C‑152/02, EU:C:2004:268), is intended, inter alia, to ensure the neutrality of the common system of VAT and to prevent taxable persons from incurring any financial risk by bearing the burden of the VAT in whole or in part. That is why, under Article 179 of the VAT Directive, the period in which the goods acquired or the service supplied were taxed for VAT purposes, giving rise to the right of deduction, must coincide with the period in which the right of deduction is exercised.

38      Thus, where a taxable person cannot deduct input VAT, relating to transactions completed during the period in which the right of deduction arose, even though the corresponding invoices are available at the time the VAT returns for that period were submitted, the taxable person temporarily bears the burden of VAT, with the result that he or she is not relieved entirely of the burden of that tax, in breach of the principles of VAT neutrality and proportionality, and of the immediate character of the deduction of input VAT paid (see, by analogy, judgment of 18 March 2021, A. (Exercise of the right of deduction), C‑895/19, EU:C:2021:216, paragraphs 46 to 49).

39      That conclusion is confirmed by the case-law concerning the temporal effects of the correction of an invoice.

40      It is apparent from the case-law that the provisions of the VAT Directive preclude national legislation under which the correction of an invoice does not have retroactive effect, so that the right to deduct VAT exercise on the basis of the corrected invoice relates not to the year in which the invoice was originally drawn up but to the year in which it was corrected (judgment of 15 September 2016, Senatex, C‑518/14, EU:C:2016:691, paragraph 43).

41      Therefore, while a taxable person may, following a correction of the corresponding invoice, exercise his or her right of deduction in respect of the tax period during which that invoice was originally drawn up, despite the lack of an invoice in proper form at the time of the original tax return, such considerations apply even more so to a taxable person who provides an invoice in proper form when submitting that return.

42      It follows that Article 167, Article 168(a) and Article 178(a) of the VAT Directive, and the principles of VAT neutrality and proportionality, must be interpreted as precluding national legislation, such as that at issue in the case in the main proceedings, under which a taxable person may not assert his or her right to deduct input tax, in a return submitted in respect of a period in which he or she satisfied the substantive conditions for exercising that right if, during that period, he or she had not yet received the corresponding invoice, even though he or she did receive the invoice before submitting the return.

43      That conclusion is not called into question by the arguments of the Polish government and of the tax authority based on Article 273 of the VAT Directive.

44      Pursuant to Article 273 of the VAT Directive, Member States may impose other obligations which they deem necessary to ensure the correct collection of VAT and to prevent evasion. The prevention of tax evasion, avoidance and abuse is a recognised objective and is encouraged by that directive. However, under the principle of proportionality, the measures which Member States may adopt pursuant to Article 273 of the VAT Directive must not go further than is necessary to attain those objectives (judgments of 12 July 2012, EMS-Bulgaria Transport, C‑284/11, EU:C:2012:458, paragraph 47, and of 12 April 2018, Biosafe – Indústria de Reciclagens, C‑8/17, EU:C:2018:249, paragraph 38).

45      At the hearing, the tax authority argued in particular that the national provision at issue was such as to prevent, in particular cases, output VAT from being deducted before it was declared as input tax in order to avoid problems concerning the verification of settlement of invoices. However, that risk is not present in a situation such as that giving rise to the dispute in the main proceedings, in which the taxable person did hold a valid invoice at the time it submitted its tax return, which enabled the tax authority to perform the necessary checks. A Member State cannot pursue the objective of ensuring the correct collection of VAT and of preventing evasion by way of a general measure which does not provide for account to be taken of all of the relevant circumstances and which is, in particular, capable of systematically impeding the right of deduction for all taxable persons (see, to that effect, judgment of 18 March 2021, A. (Exercise of the right of deduction), C‑895/19, EU:C:2021:216, paragraph 54).

46      In the light of the foregoing considerations, it is not necessary to examine whether the principle of effectiveness must be interpreted in such a way that it also precludes a national provision such as that at issue in the main proceedings.

47      Therefore, the answer to the question referred for a preliminary ruling is that Article 167, Article 168(a) and Article 178(a) of the VAT Directive and the principles of VAT neutrality and of proportionality must be interpreted as precluding national legislation under which a taxable person may not assert his or her right to deduct input tax in a return submitted for a period in which he or she satisfied the substantive conditions for exercising that right if, during that period, he or she had not yet received the corresponding invoice, even though he or she did receive the invoice before submitting the return.

 Costs

48      Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the General Court, other than the costs of those parties, are not recoverable.

On those grounds,

THE GENERAL COURT (Chamber giving preliminary rulings)

hereby rules:

Article 167, Article 168(a) and Article 178(a) of Council Directive 2006/112/EC of 28 November 2006 on the common system of value added tax and the principles of value added tax (VAT) neutrality and of proportionality,

must be interpreted as precluding national legislation under which a taxable person may not assert his or her right to deduct input tax in a return submitted for a period in which he or she satisfied the substantive conditions for exercising that right if, during that period, he or she had not yet received the corresponding invoice, even though he or she did receive the invoice before submitting the return.

Delivered in open court in Luxembourg on 11 February 2026.

[Signatures]

*      Language of the case: Polish.