Important for relocated companies in Poland
In order to understand depreciation in Poland and its importance for relocating companies, let's review the main aspects of this process regulated by tax law and used to account for the depreciation and obsolescence of property and equipment in accounting and tax records. We will look at it in a way that is more accessible to business.
One of the key documents regulating the accounting of fixed assets in Poland is the "ROZPORZĄDZENIE RADY MINISTRÓW 03.10.2016 w sprawie Klasyfikacji Środków Trwałych (KŚT)" and the Accounting Act "art. 3 ust. 1 pkt 15 ustawy z dnia 29 września 1994 on accounting (Dz. U. z 2016 poz. 1047)". Property, plant and equipment are tangible assets that have an expected useful life of more than one year and are intended for the needs of the organisation. They include, for example, real estate, land, perpetual usufruct rights, structures and buildings, and separately owned premises.
One of the key documents regulating the accounting of fixed assets in Poland is the "ROZPORZĄDZENIE RADY MINISTRÓW 03.10.2016 w sprawie Klasyfikacji Środków Trwałych (KŚT)" and the Accounting Act "art. 3 ust. 1 pkt 15 ustawy z dnia 29 września 1994 on accounting (Dz. U. z 2016 poz. 1047)". Property, plant and equipment are tangible assets that have an expected useful life of more than one year and are intended for the needs of the organisation. They include, for example, real estate, land, perpetual usufruct rights, structures and buildings, and separately owned premises.
In order to understand depreciation in Poland and its importance for relocating companies, let's review the main aspects of this process regulated by tax law and used to account for the depreciation and obsolescence of property and equipment in accounting and tax records. We will look at it in a way that is more accessible to business.
One of the key documents regulating the accounting of fixed assets in Poland is the "ROZPORZĄDZENIE RADY MINISTRÓW 03.10.2016 w sprawie Klasyfikacji Środków Trwałych (KŚT)" and the Accounting Act "art. 3 ust. 1 pkt 15 ustawy z dnia 29 września 1994 on accounting (Dz. U. z 2016 poz. 1047)". Property, plant and equipment are tangible assets that have an expected useful life of more than one year and are intended for the needs of the organisation. They include, for example, real estate, land, perpetual usufruct rights, structures and buildings, and separately owned premises.
One of the key documents regulating the accounting of fixed assets in Poland is the "ROZPORZĄDZENIE RADY MINISTRÓW 03.10.2016 w sprawie Klasyfikacji Środków Trwałych (KŚT)" and the Accounting Act "art. 3 ust. 1 pkt 15 ustawy z dnia 29 września 1994 on accounting (Dz. U. z 2016 poz. 1047)". Property, plant and equipment are tangible assets that have an expected useful life of more than one year and are intended for the needs of the organisation. They include, for example, real estate, land, perpetual usufruct rights, structures and buildings, and separately owned premises.
Property, plant and equipment that are put into use under rental, hire or leasing agreements are also accounted for in the accounting records of one of the parties to the agreement in accordance with the terms of the agreement. When fixed assets are improved (reconstructed, expanded, modernised) at the expense of the lessee, they are classified into KST groups depending on their durability.
In order for an asset to be considered fixed, it must meet certain criteria: the value of the asset exceeds PLN 10,000, the asset is owned or jointly owned by the depreciating party (even if it is leased), the asset is acquired or created internally, the asset is fit for purpose and performs certain functions in the taxpayer's business activities, and if its estimated useful life exceeds one year and it is used for needs related to the taxpayer's business activities or
Amortisation of intangible assets, buildings, premises and passenger cars is carried out on a straight-line basis.
The cost of repairs may be included in operating expenses unless reimbursed by the lessor. These costs may be charged to operating expenses if the lessor does not reimburse them.
In Poland, there are several methods of depreciation, such as the straight-line method and the declining balance method (or the declining residual value method), and the company is entitled to choose the most appropriate method for itself, taking into account its needs and specific accounting.
In order for an asset to be considered fixed, it must meet certain criteria: the value of the asset exceeds PLN 10,000, the asset is owned or jointly owned by the depreciating party (even if it is leased), the asset is acquired or created internally, the asset is fit for purpose and performs certain functions in the taxpayer's business activities, and if its estimated useful life exceeds one year and it is used for needs related to the taxpayer's business activities or
Amortisation of intangible assets, buildings, premises and passenger cars is carried out on a straight-line basis.
The cost of repairs may be included in operating expenses unless reimbursed by the lessor. These costs may be charged to operating expenses if the lessor does not reimburse them.
In Poland, there are several methods of depreciation, such as the straight-line method and the declining balance method (or the declining residual value method), and the company is entitled to choose the most appropriate method for itself, taking into account its needs and specific accounting.
Depreciation rates are set for different types of property and equipment and may vary depending on the type of activity and nature of the property. These rates are determined by national legislation and regulated by the Polish Tax Code.
The depreciation value can be used to reduce tax liability. Enterprises may include depreciation charges in the cost of products or services and reduce income tax according to the deductions accrued for property and equipment.
Given the changes in tax legislation and depreciation rates, it is important to seek advice from our tax specialists. We will help you understand the current tax requirements and rules so that you can develop your business in the new country in the most efficient way. Don't forget that proper accounting treatment of equipment and expenses can save you money and contribute to the success of your business. We are always ready to help you in this process!
The depreciation value can be used to reduce tax liability. Enterprises may include depreciation charges in the cost of products or services and reduce income tax according to the deductions accrued for property and equipment.
Given the changes in tax legislation and depreciation rates, it is important to seek advice from our tax specialists. We will help you understand the current tax requirements and rules so that you can develop your business in the new country in the most efficient way. Don't forget that proper accounting treatment of equipment and expenses can save you money and contribute to the success of your business. We are always ready to help you in this process!
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