Tax department

Fixed amount tax

A fixed amount tax (karta podatkowa) is the most simplified form of taxation in Polish tax law. It may be applied only by individuals conducting business activity as sole traders or in the form of civil law partnership. Another significant limitation is that not everyone is entitled to this tax solution.

This simplified method may be applied to six categories of business activity. Among them are:

  • retail sale of food, drink, flowers and tobacco products – except for drinks with alcohol content of over 1,5%;
  • retail sale of non-food products except for e.g. motor fuel;
  • catering services;
  • transportation services (with the use of one vehicle);
  • entertainment;
  • sole traders operating in to health or veterinary businesses.

Details of the above matters are set out by Lump-sum Income Tax Act.

Entrepreneurs using the fixed amount tax method can count on a numerous accounting simplifications. They are not obliged to bookkeeping, filing tax returns or making advance payments on personal income tax. They are also entitled to deduct the health insurance contributions. They are however, obliged to issue bills or invoices, pay the tax in fixed deadline and keep individual payroll sheets of their employees.

The choice of the fixed amount tax should be made before starting the business activity. If the business activity is already operating it should be done until 20th of January of the given year – with the effect for the following years.

CGO Legal law firm supports entrepreneurs in choosing the fixed amount tax as their taxation method. We determine the factual circumstances, the legal status and assist with completing the necessary documentation as well as with reporting the fact to the competent authorities.

For more detailed information please do not hesitate to contact us.