Abstract

The article sheds light on functioning of split payment – a mechanism introduced as of 1.7.2018 to the law on VAT. The main purpose was to point out practical aspects of new regulations which are crucial for taxpayers, who will follow them, and also for tax authorities upon which the law lays new administrative duties.In the article there is ananalysis of conditions of applying the mechanism of split payment, ways of execution of payment while using wire transfer notification and procedure of giving consent to transfer funds held on VAT account. The article presents tax incentives for taxpayers who use mechanism of split payment. The aim of the article was also to identify interpretative problems connected with applying the mechanism.