The split payment mechanism (MPP) in 2026: when it is mandatory and when it is voluntary

The split payment mechanism (MPP, also known as split payment) has existed in Poland since 1 July 2018. The idea is simple: instead of one transfer to your business partner, you split the payment into two parts. The net amount goes to the seller’s ordinary current account, and the VAT amount goes to a special VAT account. The seller can use the money in the VAT account only for specified purposes (paying VAT to the tax office, paying VAT to business partners, contributions to the Social Insurance Institution (ZUS), PIT, customs duty).

Since 1 November 2019, MPP has been mandatory for selected transactions. The law provides penalties for leaving it out, both for the seller (30% of the VAT) and for the buyer (loss of the cost deduction, joint and several liability). In 2026 the system was additionally integrated with KSeF (the national e-invoicing system). KSeF checks that the invoice conforms to the FA(3) structure, but it does not assess whether the goods or services are listed in Annex 15. The issuer is responsible for the “split payment mechanism” annotation.

When MPP is mandatory

For MPP to be obligatory, three conditions must be met together:

1. The subject of the transaction is listed in Annex 15 to the VAT Act
2. The gross amount of the invoice exceeds PLN 15,000 (for foreign currencies, the equivalent in zloty, converted under the rules of Article 31a of the VAT Act)
3. Both parties are VAT taxpayers (a B2B relationship)

If one of these elements is missing, MPP becomes voluntary. For example, an invoice for PLN 20,000 gross for consulting services is not subject to mandatory MPP, because consulting is not in Annex 15. Likewise, an invoice for PLN 10,000 gross for steel products is not subject to mandatory MPP, because it does not exceed the amount threshold.

What is in Annex 15

The groups most often met are:

• Steel and iron products: bars, pipes, sheets, structures
• Coal, coke, solid fuels
• Scrap metal and waste for recycling
• Consumer electronics: phones, laptops, tablets, processors (corresponds to GTU_06)
• Car parts and accessories (corresponds to GTU_07)
• Construction and finishing work
• Transport services in specified areas
• Selected building cleaning services

The full list is in Annex 15 to the VAT Act. Always check it before issuing an invoice for amounts above PLN 15,000 gross. In practice we recommend that clients mark every invoice for items on this list as MPP straight away, whatever the amount, because it simplifies the procedure.

How to mark an invoice correctly in KSeF

In KSeF the MPP field has a binary value: true or false. In the readable PDF view, the phrase “split payment mechanism” then appears in a visible place on the invoice. The obligation comes from Article 106e(1)(18a) of the VAT Act. In traditional systems (before KSeF) this was entered by hand as an annotation, which was the most common source of mistakes.

How to pay using MPP

A transfer using MPP is made through a dedicated banking message. In most online banking this is a separate option, “VAT transfer” or “Split payment”. The message contains four fields:

• Gross amount (net + VAT)
• VAT amount
• The seller’s NIP (tax identification number)
• Invoice number (or the word “zaliczka”, Polish for “advance payment”)

The bank automatically splits the amount and sends the VAT to the recipient’s VAT account. If you pay by an ordinary transfer (even by mistake), it does not work as MPP, which can lead to penalties. In that situation the only way out is to ask the business partner for a refund and make the transfer again using MPP.

Penalties for not using MPP

The VAT Act (Article 106e(12) and Article 108a(7)) introduces three layers of penalties:

• Seller: a VAT penalty of 30% of the tax on the invoice, if they did not include the mandatory MPP annotation
• Buyer: loss of the right to count the expense as a tax-deductible cost (Article 15d of the CIT Act, Article 22p of the PIT Act), if they paid outside MPP despite the obligation
• Joint and several liability: the buyer is liable together with the seller for the VAT arrears if they knew, or could have known, that the business partner would not pay the tax over

A documented internal procedure (a checklist before the transfer, checking the MPP annotation on the invoice) significantly reduces the risk.

What KSeF 2.0 changes

From 1 February 2026 (and for smaller firms from 1 April) the MPP marking moved into the FA(3) structure as a separate field. KSeF checks that the invoice conforms to the FA(3) structure, but it does not assess whether the goods or services are listed in Annex 15. The issuer is responsible for the “split payment mechanism” annotation. If you work with your own tools or an older version of a program, check whether it recognises the items from Annex 15.

Summary

MPP is not just a formality. It is a safety mechanism that protects your company from penalties. It is mandatory only in narrow cases (Annex 15 + PLN 15,000 gross + B2B), and we recommend it as voluntary for every B2B transaction. You set up the checking procedure before a transfer (including checking the account against the white list) in your own company – it is not part of the accounting service. We describe how we help with KSeF on our KSeF service page.

Sources: podatki.gov.pl: MPP, the VAT Act (Articles 106e, 108a, 108c), Annex 15 to the VAT Act.