DISCLAIMER: This article provides general legal and tax commentary based on Slovak and EU law as in force in 2026. It does not constitute legal or tax advice. Factual sources include the tax analysis. All statutory references should be verified against current texts on slov-lex.sk and financnasprava.sk. Before implementing any structure described, we recommend consulting a qualified Slovak lawyer and tax advisor and, where relevant, a Polish tax adviser.
Polish entrepreneurs are leaving tens of thousands of euros on the table — not because the law is against them, but because their advisers don’t know Slovak VAT law or the case law of the EU Court of Justice. Here is what actually works in practice, and where I see clients making the same mistakes every week.
“The Slovak VAT system does not favour foreigners. It treats them exactly the same as Slovak companies — and that equal treatment is precisely where the opportunity lives.“
Polish clients often asks the same question: “Is this actually legal?” They have just found out they can take delivery of a Porsche 911 for €200,000 net on the invoice of their Slovak s.r.o. The German dealer charges zero VAT — because the supply qualifies as an intra-Community supply under Article 138 of EU VAT Directive 2006/112/EC. The Slovak company self-accounts for acquisition VAT under § 11(1) of the Slovak VAT Act and immediately deducts it. The result: the car costs tens of thousands of euros less than buying it in Poland.
Answer is always the same: not only is it legal — it is precisely the mechanism the EU single market was designed to create. The question is not whether it works. The question is whether you do it correctly. And it is in that gap between theory and correct execution that clients lose money, or attract a tax audit they could easily have avoided.
The Numbers That Matter: Porsche 911 in Poland vs. Slovakia
Let us skip the vague talk about “optimisation” and look at a concrete case. Porsche 911, purchase price €200,000 net, bought from Germany, buyer is a VAT payer in both scenarios.
| Item | Polish sp. z o.o. | Slovak s.r.o. |
|---|---|---|
| Excise tax (Akcyza) | €37,200 (18.6% — engine above 2,000 cm³) | €0 — does not exist in Slovakia |
| VAT deduction | 50% for mixed use | 100% for exclusive rental (§ 85n) |
| Depreciation — luxury car | Legally capped fraction | Full €200,000 (only in case of lease without purchase option) |
| Corporate income tax rate | — | 10% up to €100,000 revenue / 21% up to €5m |
| Road tax (Porsche 911 above 3,000 cm³) | — | €218 / year (electric vehicle: €0) |
| Mileage log | Mandatory for 100% deduction | Not required for exclusive rental |
Bottom line: On the same Porsche 911 at €200,000, the Polish company immediately pays €37,200 in excise tax — money that never comes back. The Slovak s.r.o. pays nothing. The difference is sometimes larger than the price of another luxury vehicle. And this is not aggressive tax planning — it is the direct application of the EU VAT Directive and EU Court of Justice case law.
Slovak shelf companies with VAT registration.
Physical Transport to Slovakia: The Rule That Determines Everything
This is where most clients make their mistake before they even realise they are making one. Under § 11(1) of the Slovak VAT Act, the intra-Community acquisition of goods in Slovakia means acquiring the right to dispose of movable tangible property dispatched or transported to Slovakia. § 17(1) further clarifies that the place of acquisition of goods from another Member State is where the goods are located at the time the dispatch or transport to the acquirer ends.
The practical consequence is confirmed by settled EU Court of Justice case law — specifically the judgment in joined cases C-536/08 and C-539/08: an acquirer who acted under a VAT number other than that of the Member State where transport ended does not have the right to deduct VAT in the Member State under whose VAT number they acted. In plain terms: if you buy the car on your Slovak s.r.o.’s IČ DPH but have it delivered directly from Germany to Poland — you lose the right to VAT deduction in Slovakia, and the Slovak company will have to register for VAT in Poland as a foreign entity.
The solution is simple but absolute: the vehicle must be physically transported to Slovak territory — whether on its own wheels or by transporter, it does not matter. It must be registered with the Slovak Traffic Inspectorate in the name of the Slovak s.r.o., must pass the Slovak technical inspection (STK), and must be insured as a company vehicle. Only then — and only on the basis of a lease agreement — can the vehicle be made available to the Polish company or third parties. The sequence is not a formality; it is a legal condition.
§ 85n of the VAT Act from January 2026: What Changed and Why It Works in Your Favour
From 1 January 2026, § 85n of Act No. 222/2004 Coll. introduced restrictions on the right to deduct VAT on passenger vehicles. I explain it to clients simply: the law was tightened, but at the same time it created a clean, predictable exemption regime — and your Slovak s.r.o. can take full advantage of it.
The condition is binary. If the vehicle is used exclusively for rental under § 85n(4)(a)(1) of the VAT Act, you have an automatic entitlement to a 100% VAT deduction — with no obligation to keep a mileage log. However, the taxpayer must be able to prove the exclusivity of the rental: through lease agreements and, for short-term rentals, handover protocols containing the odometer reading at handover and return of the vehicle.
“If you also use the vehicle privately (for example, for the managing director’s personal trips), you lose the right to the 100% deduction entirely. The new 2026 rules eliminated proportional deductions based on actual mileage. Instead, mixed use automatically drops your VAT deduction to a flat 50% rate under § 85n(1) — regardless of whether your business trips make up 10% or 90% of the total mileage. No logbook will save you, and there is no grey area.”
Notification obligation — the most frequently forgotten step: Under § 85n(9) of the VAT Act, you are required to notify the tax office of the use of the passenger vehicle on a prescribed form, within the deadline for submitting the VAT return for the tax period in which you claim the deduction. Forgetting this notification is a cheap mistake with expensive consequences — I have seen clients lose their entire VAT refund entitlement over this single omitted step.
Place of Supply for Rental: The Table You Need to Know
Vehicle rental has specific rules under § 16(2) of the Slovak VAT Act. They differ depending on whether the rental is short-term (up to 30 days) or long-term (over 30 days), and depending on who the lessee is. This determines which country collects the VAT.
| Lessee | Short-term rental (up to 30 days) | Long-term rental (over 30 days) |
|---|---|---|
| Taxable person (e.g. Polish sp. z o.o. with Polish VAT number) | Where the vehicle is physically made available to the customer (§ 16(2) VAT Act) | Where the lessee has its seat → Poland; invoice without VAT + reverse charge; EC Sales List filed in Slovakia (§ 15(1) VAT Act) |
| Non-taxable person (e.g. Polish private individual) | Where the vehicle is physically made available to the customer | Where the lessee has their permanent residence → Poland; Slovak s.r.o. must register for VAT in Poland or use the OSS scheme (§ 68b VAT Act) |
Practical implication for short-term rentals: The physical handover location is everything. If you hand over the vehicle physically in Slovakia for up to 30 days — whether to a Polish private individual or a Polish company — the rental income is subject to Slovak VAT. If you physically hand it over in Poland to a Polish VAT payer, a reverse charge under Polish legislation applies. If handed over in Poland to a private individual, the Slovak s.r.o. must register for VAT in Poland or use the OSS scheme.
For long-term rentals (over 30 days): Physical handover location no longer matters. If your lessee is a Polish company, it is always a reverse charge to Poland. If it is a Polish private individual, you must always account for Polish VAT (via OSS or local registration).
Depreciation, Corporate Tax, and the Exemption for Leases Without a Purchase Option
The Slovak Income Tax Act (§ 17(34) of Act No. 595/2003 Coll.) limits tax depreciation for passenger vehicles with an acquisition price of €48,000 and above. For a Porsche 911 at €200,000, this would at first glance mean that the majority of the purchase price cannot be depreciated. However, the law contains a direct exemption: this restriction does not apply to a lessor who leases the vehicle under a lease agreement without a pre-agreed right to purchase (operating lease without a buy option).
Depreciation on leased assets is governed by § 19(3)(a) of the Income Tax Act: it can be included in tax expenses only up to the amount of pro-rated rental income for the relevant tax period. This means one condition: the Slovak s.r.o. must invoice from the lease annually at least the amount equal to the annual depreciation of the vehicle.
Combustion engine vehicles (categories L and M1) are classified in depreciation group 1 (4 years). Electric vehicles (BEV/PHEV) fall into depreciation group 0 (2 years). Any unclaimed annual depreciation carries forward and is applied in years following the end of the statutory depreciation period — until the full acquisition cost has been depreciated.
The corporate income tax rate depends on total taxable revenue: 10% if revenue does not exceed €100,000, 21% up to €5,000,000, and 24% above that threshold. For most clients with one leased vehicle and modest rental income, the 10% rate applies — which is yet another argument in favour of the Slovak structure.
Withholding Tax: 5% from Poland That You Can Recover
When a Slovak s.r.o. leases a vehicle to a Polish company in the course of that company’s business, the rental income is treated as a so-called “industrial” royalty or licence fee. Under Article 12(2) and (3) of the Double Taxation Treaty between Slovakia and Poland, Poland may withhold tax on such rental payments at source — but the rate must not exceed 5% of the gross amount.
The Polish lessee is therefore required to withhold 5% from each rental payment and remit it to the Polish tax authorities. The Slovak s.r.o. can subsequently credit this withheld amount against its Slovak corporate income tax liability in its annual tax return, thereby eliminating double taxation. The net financial impact is minimal — but it must be addressed in advance in the lease agreement and in the accounting of both companies.
Road Tax: Who Pays and How Much
A vehicle registered in Slovakia (Slovak licence plates), used for business purposes (rental qualifies as business use), is subject to Slovak motor vehicle tax under Act No. 361/2014 Coll. The annual rate depends on the engine displacement:
| Engine displacement (cm³) | Annual rate (€) |
|---|---|
| Electric vehicle (BEV) — categories L and M1 | €0 |
| Up to 150 | €50 |
| 150 – 900 | €62 |
| 900 – 1,200 | €80 |
| 1,200 – 1,500 | €115 |
| 1,500 – 2,000 | €148 |
| 2,000 – 3,000 | €180 |
| Above 3,000 (e.g. Porsche 911 Turbo) | €218 |
The rate increases by 10% / 20% / 30% / 40% / 50% after each 36-month interval from the vehicle’s first registration. The taxpayer is generally whoever is listed as the holder in the vehicle registration certificate — which must be addressed explicitly in the lease agreement and factored into the lease payment calculation.
Accounting: Account 022 and Revenue on 602
Under Slovak accounting law, a vehicle held for rental is recorded as non-current tangible assets on account 022 — Separate Movable Items. Accounting depreciation is set independently based on the vehicle’s expected useful life — regardless of how long it is depreciated for tax purposes. Rental income — whether from short-term or long-term leases — is recorded uniformly on account 602 — Revenue from Sale of Services.
What the Finančná Správa Actually Audits
I will be direct about this, as I am with every client: when a new Slovak s.r.o. files its first VAT return claiming a refund of €40,000 – €50,000 on the rental of a luxury vehicle, with monthly lease income of €2,000, a Polish managing director, and a registered office at a business centre in Nitra — a tax audit might not be a 100% certainty, but it is a very real possibility that you must be fully prepared for. The Finančná správa applies a standard risk-selection model, and a large first-period VAT refund claim from a newly active company is a classic trigger for closer scrutiny.
That is not discrimination. It is rational oversight. If an inquiry is opened, a prepared client gets through it in four to six weeks. An unprepared client spends eight months in correspondence and sometimes loses part of the refund. The difference between them is not the legality of the structure — it is the documentation.
Five conditions that must be in place before the purchase contract with the German dealer is signed:
- Active IČ DPH verified in the EU VIES system
- Slovak business bank account open and operational
- Signed lease agreement with the first lessee
- Commercial vehicle insurance in the s.r.o.’s name
- Slovak accountant with access to the eDane portal
Polish CFC Rules: What Most Slovak Lawyers Won’t Tell You
I will say openly what many of my colleagues omit because it falls outside their jurisdiction: Poland’s controlled foreign company rules (zagraniczna spółka kontrolowana) are a genuine risk for this structure. Since 2022, Polish CFC regulations have explicitly classified rental income as passive income. If passive income accounts for at least 33% of your company’s total income, or if your entity falls under the strict new “shell company” provisions due to holding high-value assets with low operational substance, you trigger the Polish CFC tax. Rental income from a single vehicle, with no other active business activity, hits 100% passive income and severely lacks the “real economic activity” required to claim the EU exemption.
The solution is not to avoid the structure — it is to complement it. Clients who use their Slovak s.r.o. for active intra-Community trading alongside the vehicle rental naturally dilute their passive income below the 33% threshold and build genuine local substance. I coordinate with Polish tax counsel on every client file involving a Polish-resident beneficial owner. Any Slovak lawyer who tells you that the Polish CFC question is not their problem is doing you a disservice.
Let's Talk Through Your Options.
Why Slovakia and Why a Ready-Made s.r.o.
The practical argument for a shelf company with an existing IČ DPH over a newly incorporated one is straightforward and underestimated. A new Slovak s.r.o. waits six to fourteen weeks for VAT registration if the Finančná správa requests additional substance documentation — which it does with increasing frequency for foreign shareholders. A ready-made s.r.o. with an active IČ DPH is operational on the day of transfer. For a client who has found their Porsche at a Munich dealer at a price that will not hold for three months, this difference is commercially decisive.
The opportunity is genuine, the law is clear, and the risks are manageable — but only if the structure is built in the right order, documented before it is needed, and supported by advisers in both Slovakia and Poland who are willing to communicate with each other. That coordination is the service. The shelf company is just the vehicle.
DISCLAIMER: This article provides general legal and tax commentary based on Slovak and EU law as in force in 2026. It does not constitute legal or tax advice. Factual sources include the tax analysis. All statutory references should be verified against current texts on slov-lex.sk and financnasprava.sk. Before implementing any structure described, we recommend consulting a qualified Slovak lawyer and tax advisor and, where relevant, a Polish tax adviser.
Mgr. Dominik Ondrišeje
Dominik is co-founder of the SetupMART project. Dominik is responsible for corporate services and implementation of modern technologies in our services at SetupMART. Dominik is dedicated to the sale of ready-made companies since 2011. Dominik studied law at the Pan-European School of Law.