Tax limits down in 2024
The tax limits in the tax laws expressed in euros will be lower from 1 January 2024. This is the result of a lower euro exchange rate than last year.
Most of the limits expressed in euro are converted at the average euro exchange rate announced by the National Bank of Poland on the first working day of October of the previous tax year, rounded up to PLN 1,000. This year, the first working day of October was 2 October. According to the National Bank of Poland exchange rate table No. 190/A/NBP/2023, the euro exchange rate on that day was PLN 4.6091 (last year it was PLN 4.8272). This means that all tax limits expressed in euro will fall.
Small taxpayer
Let us start with the limit for small taxpayers. A small taxpayer under income tax laws (PIT, CIT, VAT) is one in which the value of sales revenue (including VAT) did not exceed in the previous tax year an amount expressed in PLN equivalent to the equivalent of EUR 2 million. In 2024, this will be a limit of PLN 9 218 000. Currently, it is PLN 9,654,000.
As for the limit for small taxpayers, taxpayers running brokerage companies, trust fund managers and agents are small taxpayers if the amount of commission or other forms of remuneration for services rendered (including the amount of tax) did not exceed in the previous tax year the amount expressed in PLN equivalent to the equivalent of EUR 45,000. In 2024, this will be PLN 207,000.
It is also worth mentioning the limit for the 9 per cent CIT rate. This is because a small taxpayer will benefit from the 9 per cent CIT rate in 2024 if:
– his revenues for 2023 do not exceed PLN 9,218,000 (including the VAT due) – the exchange rate for the first working day of October 2023 is applied.
– its current revenue for 2024 will not exceed EUR 2 million (excluding output VAT) – the exchange rate for the first working day of January 2024 applies.
One-off depreciation
Another limit relates to one-off depreciation. It follows from the regulations that a small taxpayer may take advantage of one-off depreciation under de minimis aid, i.e. direct recognition in deductible costs of expenses for the acquisition (or manufacture) of fixed assets from groups 3-8 of the KŚT (excluding passenger cars). The total amount of non-recurring depreciation cannot exceed the equivalent of €50,000. In 2024, this will be PLN 230 000. Currently, it is PLN 241 000.
Cash method
In income tax, we still have a limit for cash method settlements. Small taxpayers who have chosen the cash accounting method submit quarterly declarations to the tax office by the 25th day of the month following each consecutive quarter. Quarterly declarations may also be filed by: small taxpayers who have not chosen the cash method; taxpayers subject to lump-sum taxation on corporate income, if the value of sales (including the amount of tax) of such taxpayers did not exceed in the previous tax year the amount expressed in PLN equivalent to the equivalent of EUR 4 million, i.e. in 2024 it will be PLN 18,436,000. Currently, the limit is PLN 19,309,000.
Lump sum
The next limit is the one giving the option of taxation on a lump-sum basis on registered income. Individuals, civil partnerships and general partnerships of individuals will be able to benefit from lump-sum taxation on registered income in 2024 if their income from business activity for 2023 does not exceed EUR 2 million, i.e. PLN 9,218,000. This is currently PLN 9,654,000.
Full books
One more limit that entrepreneurs need to bear in mind is that of keeping full books. From 2024, entities indicated in the Accounting Act whose revenues for 2023 amounted to at least EUR 2 million, i.e. PLN 9,218,000, will be obliged to keep full books of account. Currently, it is PLN 9,654,000. This applies to natural persons, civil partnerships of natural persons, general partnerships of natural persons, partnerships, inherited enterprises and civil partnerships of natural persons and inherited enterprises.