The situation
A list of uncollectible receivables and the customers behind them
A Poznań building-materials wholesaler, with a German sales company in Frankfurt (Oder), has closed the year with PLN 1.8 million of receivables more than six months overdue. Two customers are in insolvency proceedings. The controller asks how much output VAT can be recovered, in which period, and what each company must document first.
The relief exists in both countries, but it is built differently. Poland sets a list of conditions and a time window; Germany corrects the VAT once a receivable is uncollectible. Applying each set of conditions to forty invoices, and writing it up so the auditors accept it, is the work.
What the research has to settle
The rules behind the answer
- The VAT Directive allows the reduction
- Where the price is not paid, in whole or in part, the taxable amount is reduced under conditions set by each member state. States may derogate for non-payment, but the Court of Justice has held that relief cannot be ruled out where non-payment is definitive.
- Germany: correct when uncollectible
- Under § 17 UStG the supplier corrects its VAT when the consideration becomes uncollectible, and the customer must correct its input tax at the same time. If the debt is paid later, both corrections are reversed.
- Poland: conditions and a time limit
- Polish VAT law sets its own conditions, including how long the debt must be overdue and a deadline counted from the invoice. The conditions have been amended after Court of Justice rulings, so confirm the version in force for the period.
- Evidence decides whether it holds
- In both countries the supplier must be able to show the receivable is unpaid and has not been sold or otherwise settled. Keep the reminders, insolvency notices and the correction calculation with the return.
How it runs in azta
From the question to the document
The question, as you would type it
Polish wholesaler, invoices to a domestic VAT-registered customer issued in March 2025, due in April, still unpaid. The customer entered restructuring proceedings in August 2026. Can we apply bad-debt relief, in which return, and what must the customer do? Same question for our German GmbH under § 17 UStG.
You start with
A list of uncollectible receivables and the customers behind them
- 01
Set out the receivables
Describe the invoices, due dates, customers and any insolvency proceedings. azta searches the VAT Directive and the Polish and German VAT acts.
Cited research· Free - 02
Check how the courts read the conditions
Ask for decisions on disputed debts and insolvent customers. azta searches Polish administrative court decisions, German tax court decisions and the Court of Justice.
Case-law search - 03
Draft the memo
Ask for a memo per company with each condition, the invoices that meet it and the open points. Edit it in Canvas.
Canvas · Ask azta· Pro - 04
Export for the auditors
Export to Word and attach the receivables list. The citations stay with the research.
Word export· Pro You send
A memo on the conditions for VAT bad-debt relief and how each receivable meets them
What you get
A memo on the conditions for VAT bad-debt relief and how each receivable meets them
Memo · draft
Bad-debt relief on overdue receivables at year-end
Poland. Eleven of the overdue invoices meet the overdue-period condition at year-end. For each, the remaining conditions in Annex 1 have been checked against the provision in force. The correction is made in the return for the period in which the conditions are met, with the supporting information the return requires.
Germany. Two customers of the GmbH are in insolvency proceedings. Once a receivable is uncollectible, the GmbH corrects its output VAT for the period in which that happens. Any later payment from the insolvency estate triggers a further correction.
Open points. Three Polish customers dispute their invoices. Whether a disputed debt qualifies is discussed in Annex 2 with the decisions found. We recommend holding those corrections until each dispute is resolved.
Outcomes on your numbers
What azta is worth on this task
Pro pays for itself after
20 minutes a month
At €85 an hour, that is all the time Pro (€27 a month) has to take off your desk to cover its price.
Example figures. Replace them with your own.
- Hours back a year
- 32
- Capacity at your rate
- €2,754
- More bad-debt relief memos a quarter
- 1.5
- Return on Pro
- 8.5×
- Research
- Drafting
- Your review
A scenario you set, not a promise. The hours that come back go to another client, or deeper into this one.
Want these numbers on your team’s real workload?
Book a demoSources azta searches here
- EUR-Lex · Curia
- Dziennik Ustaw
- SAOS
- Gesetze im Internet
- Rechtsprechung im Internet
What stays with you
- The receivables data and the judgement on each customer.
- The correction amounts and the returns themselves.
- Agreeing the treatment with the auditors.
Frequently asked questions
- Does azta work out how much VAT to correct?
- No. It sets out the conditions and how they apply, with citations. The amounts come from your ledger and stay with your team.
- Can it check the conditions against our receivables list?
- Yes, on Pro. Upload the aged receivables list with your question and azta refers back to the lines it relied on. The judgement on each invoice stays with you.
- Does it find court decisions as well as the law?
- Yes. Court decisions make up about two thirds of the documents azta searches, alongside legislation, EU law and regulator material.
