Many entrepreneurs collect advance payments, deposits or prepayments from clients before a service is performed or goods are delivered. Receiving such a payment triggers specific obligations under VAT — it usually has to be documented with an advance invoice (faktura zaliczkowa). Below we explain when an advance invoice is required, within what deadline it must be issued, what it must contain and how it is combined with the final invoice in 2026. We also show when the advance invoice can be waived and how the advance is treated in income tax.
When the obligation to issue an advance invoice arises
If, before delivering goods or performing a service, an active VAT taxpayer receives all or part of the payment — an advance, a deposit, a prepayment or an instalment — they are, as a rule, obliged to document that payment with an advance invoice. The VAT tax obligation arises at the moment the payment is received, in relation to the amount actually received. The advance invoice therefore covers the funds actually paid, not the full value of the future transaction.
Not every payment triggers this obligation. An advance invoice is not issued, among others, in situations where the law links the moment the tax obligation arises not to the payment but to another event — this applies, for example, to supplies of utilities or rental services settled according to the payment due date. If there is any doubt whether a particular payment is an advance giving rise to a VAT obligation, it is worth consulting the transaction with an accounting office.
Within what deadline to issue the advance invoice
An advance invoice must be issued no later than the 15th day of the month following the month in which the advance was received. So if the prepayment arrived in March, there is time to issue the invoice until 15 April — regardless of when the service or delivery itself is carried out.
The law also sets a limit „from below”: the invoice may not be issued earlier than 60 days before the advance is received. Issuing the document too early, when the payment does not arrive within that period at all, is sometimes treated as a so-called premature invoice and carries the risk of a dispute with the tax authority. It is safer to issue the advance invoice only after the payment has been recorded.
What the advance invoice must contain
The advance invoice contains the standard invoice data — the date of issue, the number, the details of the seller and buyer, the tax rate and tax amount — but instead of the value of the whole transaction it shows the amount of the advance received and the tax on that amount. VAT is calculated here using the „in a hundred” method: the advance received is assumed to be a gross amount, and the tax is calculated according to a formula that takes into account the rate applied. The invoice should also include the order details — the name of the goods or service to which the prepayment relates.
The final invoice and settlement of the advances collected
After the delivery or service has been carried out, the entrepreneur issues a final (settlement) invoice, in which the entire transaction is settled. The order value and the tax amount are reduced by the advances previously documented with advance invoices, and the final invoice states the numbers of those invoices. As a result, VAT on the advances is not charged a second time. If the entire amount due was collected through advances, the final invoice may show a zero amount payable, and where the sum of the advance invoices covers the full value of the transaction, it sometimes does not need to be issued at all.
When the advance invoice can be waived
Following the changes introduced by the SLIM VAT 3 package, the seller does not have to issue a separate advance invoice if the advance and the delivery of goods or performance of the service take place in the same month. In that case a single invoice is enough — the final one — which, alongside the delivery date, should also contain the date the advance was received, if it differs from the date the document was issued. This simplification is a right, not an obligation: the entrepreneur may still issue two invoices if that is more convenient. It is worth remembering that after waiving the advance invoice, the buyer will only be able to deduct VAT from the final invoice.
The advance and income tax
For income tax purposes the rule is the opposite of VAT. An advance collected towards supplies of goods or services to be performed in subsequent settlement periods does not, as a rule, constitute revenue at the moment it is received — the revenue arises only when the supply is carried out. This means that the advance invoice alone usually generates neither a revenue entry in the tax revenue and expense ledger (KPiR) nor an obligation to pay a PIT advance. There are exceptions to this rule, which is why the treatment of a particular payment should be confirmed for the specific situation.