What will be the tax-free amount in 2024?
One of the politicians’ flagship demands was to raise the tax-free amount to PLN 60,000 (it is currently PLN 30,000). However, given that the new Polish government has still not been sworn in, this change is not expected until 2025 at the earliest. This is because such extensive modifications to the law take time.
It could take a good few months to go through the full legislative process for an increase in the tax-free amount, and introducing it within a year – while theoretically possible – is unlikely. As of the date this article is being written, which is December 6, 2023, all signs in heaven and earth indicate that in 2024 the tax-free amount will be 30,000 zlotys, which means it will remain unchanged.
CIT minimum tax from January 1
At the beginning of the year, the minimum tax for companies will take effect – it will cover companies that show a tax loss or fall below the break-even point, set at 2 percent.
The goal of the new tax is to tighten the system and prevent businesses from transferring income to tax havens to avoid taxation.
Important!
The first settlement of the minimum tax is not due until 2025, but the scope of changes accompanying the new levy makes it necessary to prepare for it. The changes will touch on how the loss is calculated and how the tax base is determined. There will also be new exemptions.
Not all CIT taxpayers will be subject to the minimum tax. The changes will bypass financial institutions, health care providers, municipal companies, mining companies receiving public assistance, and companies in bankruptcy, liquidation or restructuring.
Significantly higher agricultural tax
This is one of the tax obligations that indirectly affect the general public. As of January 2024. Agricultural tax will increase by as much as 21 percent. In theory, this applies only to owners and users of agricultural land (including arable land, orchards, plantations), but it is difficult to imagine a situation in which an increase in the tax burden on farmers will not translate into food prices.
Agricultural tax rates in 2024 will be:
- PLN 224.08/hectare converted (previously PLN 185.13, an increase of PLN 38.95),
- PLN 448.15/hectare of other agricultural land (previously PLN 370.25, an increase of PLN 77.80).
VAT on food returns(?)
This is not the end of the bad news for all consumers – at the beginning of 2024 – as we now know – the 5% VAT on food will return, which will further inflate food prices.
However, in this case – unlike the agricultural tax, which is certain – nothing has been prejudged. On November 20, representatives of the Law and Justice Party submitted a bill under which the 0% VAT rate on food would apply until the end of June 2024. What’s next for the food tax? We will find out in the coming weeks.
Local taxes go up
The Finance Ministry has published a notice in which it has decided to adjust local tax rates. This is one change that shouldn’t come as a surprise, since these rates usually follow the inflation rate. As this one is about 15 percent, that’s how much local fees may also increase.
We put emphasis on the word “may” because the regulation only indicates what amounts the indicated tributes cannot exceed – the final amount is determined by the municipal council, issuing an appropriate resolution.
How will the rates of local taxes and fees change?
Land Tax:
- related to the conduct of business, regardless of the method of qualification in the land and building register – not more than PLN 1.34 per square meter (previously PLN 1.16, an increase of PLN 0.18),
- located over standing or flowing surface waters of lakes and artificial reservoirs – PLN 6.66/ha (previously PLN 5.79, an increase of PLN 0.87),
- undeveloped, included in the revitalization area or located in areas designated for residential or commercial development – PLN 4.39 per square meter (previously PLN 3.81, an increase of PLN 0.58),
- other, including those occupied for conducting paid statutory activities by public benefit organizations – PLN 0.71/m2 (previously PLN 0.61, an increase of PLN 0.10).
Building tax:
- Residential – PLN 1.15 per square meter of floor space (previously PLN 1.00, an increase of PLN 0.15),
- related to the conduct of business activities and on residential buildings (or parts thereof) occupied for the conduct of business activities – PLN 33.10/m2 (previously PLN 28.78, an increase of PLN 4.32),
- occupied for business activities in the field of marketing of certified seed material – PLN 15.50/m2 (previously PLN 13.47, an increase of PLN 1.98),
- related to the provision of health care services within the meaning of the regulations on medical activity, occupied by entities providing such services – PLN 6.76/m2 (previously PLN 5.87, an increase of PLN 0.89),
- other, including those occupied for carrying out paid statutory activities by public benefit organizations – PLN 11.17/m2 (previously PLN 9.71, an increase of PLN 1.46).
Tax on trucks with a permissible total weight:
- over 3.5 tons to 5.5 tons – PLN 1173.19 (previously PLN 1020.16, an increase of PLN 153.03),
- over 5.5 tons to 9 tons – PLN 1957.12 (previously PLN 1701.84, an increase of PLN 255.28),
- over 9 tons, under 12 tons – PLN 2348.52 (previously PLN 2042.19, an increase of PLN 306.33),
- 12 tons and over – PLN 4481.57 (previously PLN 3897.01, an increase of PLN 584.56).
Tax on truck tractors and ballast tractors:
- adapted for use with a semi-trailer or trailer with a GVW of a combination of vehicles from 3.5 tons to 12 tons – PLN 2739.90 (previously PLN 2382.52, an increase of PLN 357.38),
- adapted for use with a semi-trailer or trailer with a GVW of a combination of vehicles from 12 to 36 tons – PLN 3463.95 (previously PLN 3012.13, an increase of PLN 451.82),
- adapted for use with a semi-trailer or trailer with a GVW of a combination of vehicles over 36 tons – PLN 4481.57 (previously PLN 3897.01, an increase of PLN 584.56).
Tax on trailers or semi-trailers:
- whose GVW including the vehicle is from 7 and below 12 tons, except those related exclusively to agricultural activities – PLN 2348.52 (previously PLN 2042.19, an increase of PLN 306.33),
- whose GVW including the vehicle is from 12 to 36 tons, except those related exclusively to agricultural activities – PLN 2739.90 (previously PLN 2382.52, an increase of PLN 357.38),
- whose GVW together with the vehicle is over 36 tons, except exclusively related to agricultural activities – PLN 3463.95 (previously PLN 3012.13, an increase of PLN 451.82).
Bus tax:
- with the number of passenger seats less than 22 – PLN 2773.16 (previously PLN 2411.44, an increase of PLN 361.72,
- with the number of passenger seats equal to or greater than 22 – PLN 3506.02 (previously PLN 3048.71, an increase of PLN 457.31).
Other local taxes and fees:
- Market fee – PLN 1096.39/day (previously PLN 953.38, an increase of PLN 143.01),
- Local fee in localities with favorable climatic properties, scenic qualities – PLN 3.22/day (previously PLN 2.80, an increase of PLN 0.42),
- Local fee in localities with the status of a spa protection area – PLN 4.54/day (previously PLN 3.94, an increase of PLN 0.60),
- Spa fee – PLN 6.21/day (previously PLN 5.40, an increase of PLN 0.81),
- Dog ownership fee – PLN 173.57/year (previously PLN 150.93, an increase of PLN 23.40),
- fixed advertising fee – PLN 3.62/day (previously PLN 3.14, an increase of 48 gr),
Variable advertising fee – PLN 0.33 per square meter of advertising area (previously PLN 0.28, an increase of 5 gr).
Other changes around taxes in 2024
The new year will also bring other changes – not necessarily directly interfering with tax rates, but affecting at least how they are handled. Among the upcoming innovations, two in particular stand out: KSeF and changes in the obligation to pay tax through a micro-tax bill.
National e-Invoicing System will be mandatory
We have written about this before – as of July 1, 2024. Businesses will have to start using the National e-Invoicing System. This is a far-reaching change that will affect all active VAT taxpayers. Paper and electronic invoices will disappear, and all will be replaced by a single standard – the structured invoice.
If your company is not yet ready to implement KSeF, download our step-by-step e-book explaining what you need to do to get ready in time for July 2024!
Changes in the operation of the micro tax account
In 2024, the catalog of receivables that must be paid using tax microaccounting will be expanded. Prominent among them are:
- payments resulting from the return on the amount of income (revenue) earned and tax due IT-8FR (on income of family foundations),
- payments resulting from the obligation to pay a lump sum on the income of foreign individuals who transfer their residence to the territory of the Republic of Poland (PIT-PZ),
- payments resulting from the obligation to pay VAT on intra-Community acquisitions of goods (VAT-14). These are the cases detailed in Art. 103 para. 5a of the VAT Law,
- payments resulting from the declaration for gaming tax (POG-P) and daily payments (POG-4 and POG-5),
- payments resulting from information on surcharges in number games, cash lotteries and telebingo games (GHD-1).
These and a number of other changes are scheduled to take effect on January 1, 2024.
Summary
Although at the dawn of a new year we cannot be sure what all tax issues will look like in 2024, the information presented in the article are those most likely scenarios as of December 6, 2023. However, if the new government decides to make modifications or pass new taxes, we will update this post regularly.
