The tax office went on the hunt. Some people will pay taxes even 5 years back
Pale fear fell upon the Poles. If they did not settle their accounts correctly with the Tax Office, they will have to pay taxes even 5 years back.
We recently wrote about Poles who rent houses and apartments via Booking and Airbnb. Their data will soon be sent to the Tax Office. If they settled their taxes incorrectly, the tax office may order the payment of overdue liabilities even 5 years back, with interest. Meanwhile, Gazeta Wyborcza describes a similar situation that happened to one of the entrepreneurs.
Pay your back taxes and cry
The man ran a sole proprietorship. He was primarily involved in translating books, articles and specialized procedures. He performed his services mainly for one client. For years, the tax office had no objections to it. That changed this year. The Tax Office ordered the payment of overdue taxes for almost 4 years back, along with interest of 14.5%.
What was it about? While running his business, the man also rented a studio apartment. The tax office decided to add the income from this to his settlements. In this way, the man exceeded his annual income of PLN 200,000. PLN per year, up to which the personal VAT exemption limit applies. In this situation, the tax office demanded payment of outstanding VAT for almost 4 years back.
Fortunately, my main contractor took on a significant amount of the VAT that was suddenly miraculously created by the tax office, so my losses were “only” limited to PLN 42,000. zloty.
– said the man.
The problem is that the VAT Act recognizes private rental as a business activity. Although it is exempt from VAT, it is included in the annual income limit. If these exceed the amount of PLN 200,000 PLN, then the entrepreneur must automatically register as a VAT payer. If he has not done so, the tax office may claim the outstanding amount. That’s what happened in this case.
A similar situation may occur in the near future for renters via Booking and Airbnb. Pursuant to the EU DAC7 directive, their data will soon be transferred to the Tax Office. If the office finds irregularities, it may summon the entrepreneur and demand repayment of overdue taxes.
