KSeF is not just an accountants’ issue – what should you pay attention to and how can you prepare for a revolution in invoicing?

For many years, KSeF has been one of the leading topics in the tax industry – the first plans to introduce such an obligation appeared back when JPK VAT was being implemented, and the potential go-live dates referred to 2019.

Despite the long time that has passed since the first announcements, and despite significant delays at the final stage of implementation on the part of the Ministry of Finance, many companies still perceive KSeF as “only an accountants’ problem” or “purely a technological matter.” Nothing could be further from the truth – a reliable and safe approach to this challenge involves a revolution in areas that are crucial to the entire company, such as sales and purchasing. KSeF often means difficult changes in relationships with business partners, as well as internal changes, including document workflows and rules of responsibility within the enterprise, which must be properly prepared.

Below we present an overview of the key issues that require cooperation and attention from all departments in the company.

Challenges related to document workflow and cost identification

KSeF introduces a major change in the process of receiving invoices, often referred to as a reversed document flow. Purchase invoices will no longer – as has traditionally been the case – go directly to the people substantively responsible for the purchase, but will instead be sent directly to the finance and accounting system. A lack of appropriate internal regulations and involvement of the “business” side may result in difficulties in identifying costs and potentially lead to decision-making paralysis on the finance side, for example when finance receives documents with no substantive description.

Without proper verification procedures, the risk increases that invoices will be posted for services that were not performed, or invoices issued as a result of fraud. In the case of large-scale operations, difficulties in identifying the person responsible for a given cost may lead to bottlenecks in document processing and errors in allocating costs to the appropriate reporting periods. In addition, the KSeF system does not support traditional attachments, which makes it necessary to establish alternative channels for providing technical specifications or acceptance protocols required for the substantive approval of an expense.

Authorisation management and token security

A significant risk area is the management of authentication methods in the system, in particular authorisation tokens. These tokens may provide broad permissions and, in practice, can enable anonymous access to the system if they are not properly supervised. There is a risk that a token saved in a system or shared with an employee will remain active even after the employment relationship ends, which creates the threat of unauthorised data retrieval or issuing invoices on behalf of the entity.

Procedures in the event of a KSeF outage

Systems are prone to failures, both on the side of the Ministry of Finance and on the taxpayer’s infrastructure side. In the event of system unavailability, regulations provide for the so-called offline or offline24 mode, which allows an invoice to be issued, but imposes on the taxpayer the obligation to submit it to KSeF within a strictly defined deadline, usually one business day after the outage has been resolved. Failure to meet this obligation or failure to maintain the required logical structure of the invoice involves the risk of administrative penalties.

Settling employee invoices and B2B transactions

KSeF complicates the settlement of expenses incurred by employees and documented with invoices bearing the employer’s VAT ID (NIP). Such documents go directly to KSeF, bypassing the employee, which makes it difficult to assign the expense to the relevant person.

Elimination of backdating and date consistency

The implementation of KSeF means it will no longer be possible to issue invoices with a retroactive date in the way that has been practiced so far. The date indicated in field P_1 of the structured invoice (invoice issue date) is verified by the system in real time, and the legally relevant moment of receipt of the invoice is the moment it is assigned a KSeF number.

Verifying invoice format and eliminating duplicates

Not all business partners are obliged to use KSeF. At the same time, Polish entities may mistakenly send invoices in the traditional manner despite the legal obligation to use KSeF. There is also a serious risk of duplicate payments where the same transaction is paid once based on a PDF file sent by email and a second time based on an XML file downloaded from KSeF.

The topics above are only some of the issues that will have to be analysed, resolved technologically, and properly structured/“processed” for most taxpayers. Our experience shows that only sufficiently early preparation of the entire organisation for such major changes, with the involvement of all key departments, provides a chance to effectively design and implement the appropriate instructions and procedures. And such solutions require familiarisation by many members of each organisation, because in the new reality they will prove necessary and very, very important.

If you have any questions or doubts in this regard, or need consultations with practitioners who have delivered numerous implementation projects, we invite you to contact us.