What changes will entrepreneurs face in 2017

Many new provisions relating to doing business entered into force on 1 January 2017. Many of them will simplify the conduct of business activity and reduce operating costs.  The most important changes are, among other things, the increase from 1,2 mln to 2 mln of the limit up to which you can apply a simplified accounting.  Good news for lump sum payers will be the increase from EUR 150,000 to EUR 250,000 in the limit of revenues entitling to settle in the form of lump sum.  In 2017 there is also higher (PLN 200,000) limit of personal exemption from VAT.  In addition, the so-called small taxable persons and entrepreneurs starting  their activity, may benefit from the reduced 15 % rate of corporate income tax.  Entrepreneurs who settle in accordance with the general rules (PIT) should be aware of the new provisions governing the tax free allowance

See below the main changes for entrepreneurs in force since 2017.

Taxes

  • Increased tax-free allowance (PIT)

Tax free allowance from 1 January 2017 amounts to PLN 6600 (for taxpayers earning annually PLN 6600 or less).  For persons with income from PLN 6600 to PLN 11,000 tax free allowance will decrease gradually.  For income from PLN 11 000 to PLN 85 528, the amount of the tax-free allowance remains unchanged, i.e. it is PLN 3091.  In the case of people with an income above PLN 85 528 per year, the amount of the tax-free allowance will be progressively reduced.   For taxable persons who exceed the threshold of more than 127,000 per year, there will be no tax free allowance. Find out more on personal income tax (PIT)

  • Changes in VAT

Limit of the value of sales to benefit from the exemption from VAT was increased to PLN 200,000 (from 150,000). From 1 January 2017, the quarterly VAT settlement is available only to small taxable persons (sales of less than EUR 1,2 million).  Changes in VAT also concern the VAT reverse charge mechanism and rules for reimbursement of the tax.  Learn more about the other changes in VAT since 2017.

  • The reduced rate of corporation tax of 15 %

Some companies may benefit from a reduced rate of corporation tax of 15 %.  This includes those whose value of sales revenue (together with the amount of tax payable in respect of goods and services) in the previous tax year did not exceed EUR 1,2 mln. In addition, companies starting their activity may benefit from a lower rate of corporation tax (in the first year). 

Learn more

  • Tax reliefs for R&D activities

Entrepreneurs investing in the research and development can benefit from the new reliefs. The amount of eligible costs of R & D expenditure, which can be deducted from the tax base have been increased.  The list of eligible costs, which can be deducted from the basis for calculation of the tax (including the costs of obtaining a patent for an invention, the utility model) have been extended. Find out more.

Accountancy

Since 2017, there have been new rules on accounting. The most important are as follows:

  • The full accounting from EUR 2 mln revenue

Limit of net income (from the sale of goods, products and financial operations) to which the natural persons, individuals in civil partnerships, registered partnerships and partnerships can keep revenue and expense ledger (small accounts) was increased from 1,2 mln to EUR 2 mln.  Find out more on accountingSee also, how to switch from accounts to simplified accounts"

 

  • Income threshold for lump sum increased to EUR 250,000

Since 2017 there have been facilitations for entrepreneurs who settle in the form of a lump sum.  Revenue threshold, which enable to account for a lump sum on registered income was raised from EUR 150,000 to EUR 250,000See more on the lump sum.

 

  • The transaction limit without the use of a bank account is PLN 15,000.

With effect from the 2017 limit of transactions that may be carried out in the absence of the bank account, was reduced from EUR 15,000 to PLN 15,000.  Find out more.

ZUS

  • New basis for the calculation of ZUS contributions

In 2017 new basis for the calculation of ZUS contributions are applicable.  The minimum wage was increased to PLN 2000 gross. The amount of the projected, average wage has changed.  ZUS rates can be found in the article ZUS contributions payer.

Labour law

  • The minimum hourly rate for contracts of mandate

If you employ workers on contract of mandate remember that the hourly minimum wage was introduced for workers on certain contracts of mandate and service contracts, including self-employed.  In 2017, it amounts to PLN 13.  Find out more.

  • The full rate of minimum wage for newly employed

Provision which enabled the payment of 80 % of the minimum wage for new staff has been abolished. More on the minimum wage.

Other

The changes, which have been in force since the beginning of 2017 relate also to the interpretation of rules, facilitations in the investment process, reducing information obligations in the field of environment, relaxation of the rules on controls.  For more information on the changes can be found in the article Facilitations for entrepreneurs in 2017 and Changes in VAT in 2017

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