Representatives of the government make warnings about the danger of VAT fraud
The tax authorities took the initiative to help Polish entrepreneurs to protect them from possible fraud. It is now quite easy to get into the ‘VAT carousel’, as it is called in professional circles. This carousel is designed to allow fraudsters to illegally receive state money. They returned them in the form of value-added tax. In order to start protection, the officials decided to send newsletters to companies that could potentially become victims of fraud.
In a different way, a VAT carousel is called ‘A Missing Trader’ fraud. This type of fraud occurs when there is an unreasonable tax refund to the enterprise. Such fraud involves the concealment of traces, so fraudsters conduct fake transactions, for example, move goods from country to country. Accordingly, they are forced to create fake accounts. Sometimes, a business owner can buy goods with such VAT and, if they are inattentive, they will unwittingly become an accomplice in a fraud. This may cause problems with law protection facilities.
The tax authority officially operating in the country is ready to send letters to anyone who could potentially suffer from suspicious traders. Also, the letters will contain tips on how to avoid possible problems. For example, the legislation dictates the mandatory recommendations for checking all potential suppliers and customers with whom there may be work. It is also important to use the recommended payment mechanism: to make separate payments in all transactions where VAT is involved.
Another type of notification that will be sent by the tax authorities is a warning about suspicious transaction chains. To date, a similar idea already exists in the UK and the Netherlands. Such transactions can be identified using the analysis of data transmitted by banks and companies that are obliged to transmit information about financial manipulations and transactions. Today, the Polish Tax Administration has data on more than 7 billion accounts that have been opened in Poland.
Unfortunately, this type of fraud is common throughout the EU. Each year, up to 50 billion Euros go to the accounts of fraudsters who work in organized groups.
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