Guide · Invoices
Updated: · 7 min read · By Agnieszka Saladra, Certified Accountant
When you receive part of the payment before delivering goods or performing a service, an advance invoice documents it, and a final invoice closes the whole transaction. In this guide we show when each of these documents is issued, which elements an advance invoice must contain, how to calculate VAT on an advance and how this works in KSeF (the National e-Invoicing System) from 2026. Luno-Group clients issue advance and final invoices free of charge in the client panel.
In short
You issue an advance invoice when, before delivering goods or performing a service, you receive all or part of the payment. The rules treat the various forms of prepayment in the same way: an advance, a deposit, a prepayment, an instalment or a contribution. What counts is simply the fact that the money came in before the sale took place.
If you sell to another company, receiving an advance gives rise to an obligation to document it with an invoice. In transactions with a consumer you issue an advance invoice at the buyer's request. There are exceptions to the rule - for certain activities, for example rental, leasing or the supply of utilities, the advance alone does not trigger the tax obligation and no separate advance invoice is issued.
There is also a situation in which an advance invoice need not be issued at all: when you receive the payment and carry out the delivery in the same month (settlement period). You can then include the whole transaction in a single invoice. Whether an advance invoice is needed in your case depends on the type of activity and the moment of payment - on request we will check this against your data.
An advance invoice contains most of the elements of a regular invoice, but it also has a few fields specific to an advance. It is these that determine whether the document is correct.
An advance invoice relates to the amount received, not to the whole order value. If you issue more than one advance invoice for the same transaction, the last of them should contain the numbers of the earlier advance invoices, so that it is clear that together they cover the whole payment.
Advances are subject to a different rule from ordinary sales. As a rule the VAT obligation arises at the moment of delivery of the goods or performance of the service. If, however, you receive all or part of the payment earlier, the tax obligation arises at the moment it is received - in relation to the amount received.
In practice this means you report VAT on the advance in the settlement for the period in which the money came in, not only at the final delivery. The date that decides this is the date of receipt of the payment, not the date of issue of the advance invoice. You may issue the invoice as much as 60 days before receiving the advance, but the tax obligation will nonetheless arise only at the moment the funds actually come in.
There are exceptions to this rule - for some activities, such as rental, leasing or the supply of utilities, receiving an advance does not bring forward the moment the tax obligation arises. Because the details depend on the type of transaction, we will explain the very moment of recognising VAT in relation to your specific situation.
An advance is usually paid as a gross amount, which is why VAT is calculated by the 'gross-up' (in-hundred) method - that is, it is extracted from an amount that already includes the tax. The formula used for this is:
VAT amount = (gross advance x VAT rate) / (100 + VAT rate)
A client pays an advance of PLN 1,230 for a service covered by the 23% rate. The VAT amount is (1,230 x 23) / 123 = PLN 230, and the net value of the advance is PLN 1,000. On the advance invoice you therefore report: net PLN 1,000, VAT PLN 230, gross PLN 1,230 - and you settle this VAT in the period the payment was received.
You issue a final invoice (also called a settlement invoice) after the delivery has been made or the service performed, when the advances paid earlier did not cover 100% of the transaction value. It closes the settlement and shows how much remains to be paid.
On the final invoice you show the full value of the goods or service, and then reduce it by the sum of the advances received and by the VAT amounts reported in the advance invoices. The difference remains to be paid. The final invoice should also contain the numbers of the advance invoices issued earlier - in KSeF these are their KSeF numbers - so that the link between the documents is visible.
A service costs PLN 12,300 gross (PLN 10,000 net + PLN 2,300 VAT). The client paid an advance of PLN 1,230 earlier (PLN 1,000 net + PLN 230 VAT) documented with an advance invoice. On the final invoice you show the whole PLN 12,300, reduce it by the advance and its VAT, and PLN 11,070 remains to be paid (PLN 9,000 net + PLN 2,070 VAT).
If the advance (or the sum of the advances) covered the whole transaction value, a final invoice is as a rule not needed. The whole amount and the whole VAT have already been reported in the advance invoices, so there is nothing extra to settle.
In such a situation the closing document is the last advance invoice, which covers 100% of the payment. It should contain the numbers of the earlier advance invoices relating to the same transaction - in KSeF, their KSeF numbers (Article 106f(4) of the VAT Act). The rules do not provide for an additional 'zero' final invoice in this situation, and the practice of issuing one is assessed in different ways - we will establish how to document it on the data of the specific transaction.
The deadlines are the same as for a regular invoice, but they are counted from different events - for the advance invoice from receipt of the payment, for the final one from the delivery or performance of the service.
Keeping to these deadlines matters for VAT settlements. At Luno-Group we watch over them for our clients, so that advance and final invoices reach the books on time.
From 2026 invoices between companies are issued in the National e-Invoicing System (KSeF) in a structured form compliant with the FA(3) schema. The obligation came into force in stages: from 1 February 2026 for companies whose sales including the tax amount exceeded PLN 200 million in 2024, from 1 April 2026 for the remaining entrepreneurs, and from 1 January 2027 it will cover the smallest ones, who until the end of 2026 use the exclusion for sales documented with invoices of up to PLN 10,000 a month. This also covers advance and final invoices.
In KSeF an advance invoice is the same FA(3) file as other e-invoices, only with the fields appropriate for an advance. The link between the final invoice and the advance invoices is indicated through the KSeF numbers of the earlier advance invoices, given in the FakturaZaliczkowa part of the FA(3) structure; if the advance invoice was issued outside KSeF, the number assigned to it by the seller is given. The simplification known from the existing rules is also retained: when you receive the payment and carry out the sale in the same month, you may skip a separate advance invoice and issue a single invoice.
Until the end of 2026 certain transitional arrangements apply, including the possibility of issuing some invoices outside KSeF where monthly sales value is low. Because the details depend on the company's situation, if you have doubts about how to document advances, we will explain them against your data.
At Luno-Group we provide online accounting, but behind the settlements stand experienced accountants, not the app alone. Advance invoices can be confusing, because they link to the moment the VAT obligation arises and to the final invoice - we will make sure the whole thing is consistent and settled in the right period.
Our clients issue advance and final invoices free of charge in the client panel, and we watch the deadlines and the correct linking of documents in KSeF. We provide the entire service in Polish and in English.
You issue an advance invoice when, before delivering goods or performing a service, you receive all or part of the payment from another company. In a transaction with a consumer you do so at their request. Exceptions include rental, leasing and the supply of utilities, for which the advance alone does not require an advance invoice.
As a rule the VAT obligation on an advance arises at the moment it is received, in relation to the amount received. The date the money comes in counts, not the date the invoice is issued. For some activities, such as rental or the supply of utilities, an advance does not bring forward the moment the obligation arises.
VAT is calculated by the 'gross-up' (in-hundred) method from the gross amount using the formula: VAT amount = (gross advance x rate) / (100 + rate). For an advance of PLN 1,230 and a 23% rate the VAT is (1,230 x 23) / 123 = PLN 230, and the net is PLN 1,000. You settle this tax amount in the period the payment was received.
You issue a final invoice after the delivery has been made or the service performed, when the advances paid did not cover the whole transaction value. On it you show the full value, reduced by the advances received and the VAT attributable to them. It should also contain the numbers of the earlier advance invoices - in KSeF, their KSeF numbers.
When the advance or the sum of the advances covered 100% of the value, a final invoice is usually not needed, because the whole amount and the whole VAT have already been reported. The closing document is then the last advance invoice, containing the numbers of the previous ones - in KSeF, their KSeF numbers. The rules do not provide for an additional 'zero' final invoice here, and the practice of issuing one is assessed in different ways.
Yes. From 2026 mandatory e-invoicing in KSeF also covers advance and final invoices, issued in the FA(3) structure. The obligation came into force in stages: from 1 February 2026 for the largest companies and from 1 April 2026 for the rest; the smallest, with sales invoiced up to PLN 10,000 a month, will be covered from 1 January 2027. The link between the final invoice and the advance invoices is indicated through the KSeF numbers of the earlier advance invoices.