Tax regulations in 2017

New year means new challenges and new opportunities. Customarily, the first day of January is also the date when numerous new legal regulations come into force. In 2016, Polish parliament worked on and passed several important changes to the fiscal system.

Most notably, the Ministry of Finance worked hard to cut down the so-called VAT gap, i.e. the difference between the expected and paid budget income coming from value added tax payments. A series of amendments was introduced to tighten tax regulations and make tax fraud and VAT carousels easier to detect and penalize.

The Ministry imposed harsher penalties for issuing the so-called “empty” invoices. Losing one’s VAT number will be easier than before. What is more, from January, only the small companies will be allowed to submit VAT tax returns on a quarterly basis. All entities with income exceeding 1.2 million EUR will be obliged to use monthly reporting.

Good news for entrepreneurs is lowering the corporate tax rate. Companies using this form of tax settlements will pay tax authorities 15% instead of 19% of their income. However, the change will only apply to small taxpayers. A vast majority of them choses PIT tax over CIT tax when settling tax obligations.

From 2017, more taxpayers will fall under the obligation to provide tax authorities with the so-called Unified Control Files. The file is digital record of several types of important information regarding business activity, such as the revenue and expense ledger and VAT registers. Currently, only big entities are legally required to submit such information. From January, this will be mandatory for small and middle-sized businesses as well.

What is more, the government made some changes concerning the tax-free amount (it will be increased) and excise tax on cars (it will be calculated according to different rules).

Keeping up with the latest developments in tax law is extremely important. To make sure your company is compliant with all obligations, consider hiring a tax attorney.