Statutory interest for late payment, tax arrears
You should regulate towards the Tax Office, ZUS, as well as trading partners you should regulate in a timely manner. To avoid unnecessary problems such as the submission of additional documents as well as additional interest for late payment. The rate of interest on arrears in the case of tax liabilities, commitments arising from the use of capital, are governed by the relevant rules. Importantly, since the beginning of 2016, new rules for the interest calculation in relation to commercial transactions have been applicable. Rules for determining the statutory interest, and statutory interest for late payments have also changed.
Interest in commercial transactions
They concern, as the name suggests, only commercial transactions, i.e. contracts for the supply of goods or the provision of services for consideration, if the parties conclude it in connection with the activity carried out. Parties may be the entrepreneurs (Polish and foreign), professionals or the public finances sector unit.
Previous regulations on interest for late payment in business related to tax law (interest, unless otherwise agreed by the parties, were equal to the rate of interest for tax arrears).
The legislation In force since 2016, sets the rate of statutory interest for late payment in transactions, as the sum of the reference rate and eight percentage points (currently 9.5 % per year), unless the parties agreed higher rates of interest. To determine the level of statutory interest for delay in commercial transactions the reference rate of the National Bank of Poland on the day is applicable:
1 January - to interest due for the period from 1 January to 30 June;
1 July- to interest due for the period from 1 July to 31 December.
Current reference rate can be checked on the NBP websites.
More on the calculation of interest in commercial transactions, can be found in the article Time limits for business transactions.
Include remuneration for the use of capital (e.g. loan). They are due when they result from legal act (e.g. concluded contract) Act, a court ruling or decision of the body. Statutory interest shall be payable if, for example, the contract does not stipulate their level.
From 1 January 2016, the statutory rate of interest (capital) is equivalent to the reference rate of the National Bank of Poland, increased by 3,5 percentage points (currently 5 %). Current reference rate can be checked on the NBP website.
The maximum percentage of capital arising from the legal acts has also changed. It is twice the amount of statutory interest (by 2016 it was four times the Lombard interest rate of the National Bank of Poland).
Calculator of statutory interest calculator is available on the Ministry of Finance website.
Statutory interest for late payment
The creditor may demand default interest if the debtor is late in complying with the consideration. This is the case even where the creditor does not suffer damage and the delays were not due to the fault of the debtor.
In accordance with the rules in force since 2016, such as where the contract does not provide for interest on late payment, statutory interest for late payment is equal to the sum of the reference rate of the Polish National Bank and 5,5 percentage points, i.e. currently 7 % (by end of 2015, the creditor was entitled to ‘normal' interest at the rate of statutory interest. They may be higher, if the parties have agreed on it in the contract, however, they may not exceed the maximum value. On an annual basis it may not exceed twice the amount of statutory interest for late payment. If the contract specified them above maximum value, they will be automatically reduced to that value.
Interest on tax arrears
The provisions also regulate the rate of interest in the event of tax arrears. Arrear may be tax not paid on the due date, but also undue refund of overpayment (which tax authority returned or passed on against other liabilities) or undue reimbursement. The amount of interest for late payment of tax is equivalent to twice the base interest rate of the Lombard credit of NBP and two percentage points, but not less than 8 %. This is the basic rate.
Important! Interest on arrears shall be established separately from any tax arrears.
If two conditions are met:
submission of a legally effective correction of the return, no later than 6 months after expiry of the period for the submitting the declaration;
payment of tax arrears within 7 days from the date of submitting correction,
the reduced interest rate of 50 % of the basic rate may be applied. It is applicable, however, in certain circumstances, it may not be used ‘following time', e.g. in the case of the correction of the return submitted only after the notice of intention to initiate a tax audit (in cases where no notice — after the completion of a tax control), or when we submit correction only as a result of the verification activities.
There are also penalty rates. For serious misconduct, such as: understatement of the amount of tax liability, overstatement of the amount of overpayment or tax refund disclosed in the course of control or tax proceedings, a rate of 150 % is applied. Interest on late payments will also have to be paid when we submit correction after delivery of the notice of intention to initiate a tax audit (in cases where there is no notice, after the audit is completed) or we will make correction as a result of verification activities. In these cases, the payment of higher interest rates is a situation where the amount of understatement of the tax liability, overpayments or tax rebates overstatement exceeds 25 % of the amount due and is higher than five times the minimum wage on the day following the deadline for payment of the liability or refund.
Interest on tax arrears shall be calculated by multiplying the amount of liabilty by number of days of delay and the amount of statutory interest on tax arrears (currently 0,08 - 8%). This number is divided by 365.
You might find useful for the calculation of arrears - calculator of interest on tax arrears and late payment charges available on the website of the Ministry of Finance.
Interests for late payment are calculated from the day after the day on which the deadline expires or the period for which the payment of tax was to be made on the tax authority's account.
Interests shall be calculated and paid without a request from the competent authorities.
In accordance with the tax law, interests are not applied if the amount thereof does not exceed three times the value of the fee charged by mail for order letters (currently PLN 8,70).
shall be rounded up/down to the nearest zloty (PLN) as amounts of less than 50 groszy shall be ignored, and amounts of 50 gr ends and above is rounded up to the nearest zloty.
Rounding shall be carried out separately for tax and separately for interest on arrears.
In the case of partial payments (not covering full commitment) against the tax debt and setting-off in respect of overpayments and such arrears to rounding shall not apply (remaining amount including grosz).
Rounding does not apply to debts owed to the public authorities on local taxes. In their case also amount to two decimal places to the nearest zloty is charged.
Interest on late payment ZUS
Default interest on social security contributions are calculated according to the same rules as in the case of tax arrears (the same rate of interest equivalent to twice the base interest rate of NBP lombard credits and two percentage points, but not less than 8 %,
If social security arrears amount to PLN 6,60 and less - interests shall not be charged.
Use ZUS calculator of interests
Find out how the calculation of interest on arrears in the ZUS looks like in detail