Cash PIT – the draft bill adopted

The Council of Ministers has adopted a draft bill on the so-called cash PIT. The new solution will enable entrepreneurs conducting business activity to independently choose the cash settlement of revenues and costs of obtaining revenues.

Cash PIT – what is the new solution?

Cash PIT is a solution intended for entrepreneurs who run their own business, whose revenues from their business in the previous tax year did not exceed the equivalent of EUR 250,000, as well as entrepreneurs who are starting their businesses.

According to the draft bill, persons conducting business activity in the form of a civil partnership or general partnership, as well as entrepreneurs keeping accounting books, will not be entitled to the cash PIT.

The cash PIT is to apply to entrepreneurs settling their income tax under:

tax scale,
IP BOX,
flat tax,
lump sum tax on recorded revenues.

Cash PIT will be available on a voluntary basis. To use this form of settlement, it will be necessary to submit an appropriate declaration to the appropriate head of the tax office.

By choosing the cash PIT, the entrepreneur will pay income tax only after actually receiving payment for the goods delivered or the services provided. In the case of choosing the cash PIT option, the costs of obtaining income will be deductible only after payment for the goods or services purchased.

It is important, however, that after 2 years from the date of invoice issue, the entrepreneur will be obliged to recognize income from business activities, even if he/she does not receive payment from contractors for the goods or services provided.

Cash PIT – when will it be available?

The government has already submitted a draft bill providing for the introduction of the so-called cash PIT to the Sejm. The new regulations are to enter into force on 1 January 2025.

The cash PIT is intended to eliminate the situation in which a sole proprietor pays tax on income that he or she has not received.

Ongoing tax advisory – how can we help?

We help entrepreneurs to operate in accordance with current tax regulations, optimally use available solutions and minimize the risk of sanctions. We offer access to highly qualified tax experts who support clients in their daily tax challenges, helping to achieve the intended business goals.

Learn about our service: Ongoing tax advisory in Poland