How to set up a city cleaning facility - tips

Each owner of a flat or premises is obliged to dispose of the municipal waste collected by them in a manner consistent with the regulations. The collection of this waste most often lies with the commune. As part of these activities, the head of the commune, mayor or city president organizes a tender for the performance and provision of the above-mentioned services.

To carry out the tender, the city authorities define the terms of reference, which include:

• requirements for the transfer of collected mixed municipal waste, green waste and municipal waste sorting residues intended for storage to regional municipal waste processing installations;

• determination of types of municipal waste, collected selectively from property owners;

• determining the sanitary standard of services and environmental protection;

• obligation to keep documentation related to the activities covered by the contract;

• detailed requirements for entrepreneurs collecting municipal waste from property owners.

Attention! An entrepreneur who will collect municipal waste from property owners on behalf of a commune, may only be an entity selected in a tender. The commune must sign an appropriate agreement with him. The project will be financed from fees for municipal waste management collected by the commune from property owners. The entrepreneur must also be registered in the database of waste exporting entities.

The activity in the field of collecting municipal waste from property owners is a regulated activity. Its register is kept by the head of the commune, mayor or city president competent for the place of collection of municipal waste. Accordingly, an entrepreneur who wants to collect garbage from property owners must first obtain an entry in the register by submitting the appropriate letter. This application should include:

• company, registered office and address or name, surname and address of the entrepreneur;

• tax identification number (NIP);

• REGON identification number, if the entrepreneur has such a number;

• determination of the type of municipal waste collected.

The entrepreneur attaches to the application a proof of payment of the stamp duty and a declaration of compliance with the conditions required to perform the activity in the field of collecting municipal waste from property owners with a specific content.

Prerequisites for running a city cleaning plant. An entrepreneur collecting municipal waste from property owners must meet the following requirements:

• have equipment enabling collection of municipal waste from property owners and ensuring its proper technical condition;

• maintain the proper sanitary condition of vehicles and devices for collecting municipal waste from property owners;

• meet the technical requirements for the equipment of vehicles for collecting municipal waste from property owners;

• ensure the appropriate location and equipment of the warehouse and transport base.

Determination of the PKD number for the city cleaning plant

The PKD number for the plant cleaning the city is 38.11.Z: collection of non-hazardous waste. This class includes:

• collection of solid waste (rubbish), such as household waste or industrial waste from waste bins, containers, etc., which may contain various recyclable materials,
• collection of recyclable materials,
• collecting waste from garbage bins in public places,
• collecting construction or demolition waste,
• collecting and removing remains such as thickets, bushes, debris, crushed stone,
• collecting waste from the production of textile plants.

Forms of running a city cleaning plant

Collection and disposal of municipal waste may be a business activity carried out in any form, except for a partner company that is reserved for professionals.

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How to set up a city cleaning plant?

If the future entrepreneur plans to conduct business in the form of a sole proprietorship or a civil partnership, he shall report this fact on the CEIDG-1 form. However, with the intention of running a city cleaning plant in the form of:

• general partnership,

• limited partnership,

• limited joint-stock partnership,

• limited liability companies or

• joint stock company

the entrepreneur reports this fact to the National Court Register.

The best form of taxation for a city clean-up facility

Entrepreneurs collecting and transporting municipal waste may choose the following forms of taxation:

• General rules,

• flat tax,

• lump sum on registered revenues.

However, it is not possible to tax income from this economic activity in the form of a tax card.

General rules may turn out to be profitable when the entrepreneur does not exceed the first threshold of the scale, i.e. PLN 85,528 of income. In addition, in the case of taxation according to the scale, the taxpayer may take advantage of many reliefs that cannot be used by the flat taxpayer (e.g. pro-family relief or joint settlement with the spouse). They also lose these reliefs when they choose the form of lump sum settlement. However, then its revenues (excluding costs) are taxed at the 8.5% rate.

In this way, if you want to choose a more favorable form of taxation of the city cleaning plant, you should analyze the expected income and costs, as well as the private situation of the entrepreneur.

City cleaning plant with or without VAT

An entrepreneur providing this type of services for the purpose of registration for VAT purposes should complete the VAT-R registration form. Importantly, services in the field of municipal waste collection are taxed at the rate of 8% VAT.

Until a turnover of PLN 150,000 is achieved, the entrepreneur may benefit from the subjective exemption from VAT.

Taxpayers who provide this type of service, as a rule, do not need to have a cash register. Because the regulation shows that the following are exempt from the cash register:

• services related to the collection of non-hazardous waste suitable for recycling,

• non-recyclable non-hazardous waste collection services,

• services related to the treatment of non-hazardous waste for final disposal, etc.

City cleaning plant and ZUS contributions

If the city cleaning plant is run in the form of a sole proprietorship, a limited liability company or a partnership: civil law, general partnership, limited partnership or partnership, the entrepreneur submits an insurance application with the Social Insurance Institution (ZUS). Each partner from the above-mentioned of companies is a premium payer for its own insurance.

Entrepreneurs who start running a sole proprietorship have the right to take advantage of the so-called preferential ZUS rates. Persons benefiting from preferential ZUS rates are also not obliged to pay the Labor Fund.

Company account for the city cleaning plant

The regulations do not explicitly require the entrepreneur to have a separate company account. Nevertheless, making or receiving payments related to the conducted business activity should be made through the entrepreneur's bank account (it may also be a personal account) whenever:

• a party to the transaction from which the payment results is another entrepreneur and

• the one-off transaction value, regardless of the number of payments resulting therefrom, exceeds the equivalent of EUR 15,000 converted into zlotys at the average exchange rate of foreign currencies announced by the National Bank of Poland on the last day of the month preceding the month in which the transaction was made.

Housing conditions for a city cleaning plant

No premises are required to run a municipal waste disposal company, as the services are provided in the field. However, in order to store documentation, conduct reporting and sign contracts, it is necessary to secure access to the office or other rooms where these activities can be performed.

Regardless of the above, the city cleaning plant must have a warehouse and transport base, where cars for garbage collection will be stationed and in which activities related to disinfection and washing of these vehicles will be carried out. The database should include:

• break rooms for employees,

• places for storing selectively collected waste, and

• truck scale in the case of waste storage.

The requirements for storage and transport bases should meet the conditions specified in the Regulation of the Minister of the Environment of January 11, 2013 on detailed requirements for collecting municipal waste from property owners.

Reporting of the city cleaning plant

Entrepreneurs who collect municipal waste are required to prepare quarterly reports. The mandatory elements of the report are presented below:

• information on the weight of individual types of municipal waste collected and the method of its management, along with an indication of the installation to which mixed municipal waste, green waste and waste from sorting municipal waste intended for storage were transferred;

• information on the mass of biodegradable municipal waste,

• number of property owners from which municipal waste was collected,

• information and indication of property owners who collect municipal waste in a manner inconsistent with the regulations.

Marketing of the city cleaning plant

Companies collecting municipal waste do not have to invest in large advertising campaigns or advertise in local newspapers. As their services are rented on a tender basis, the most important thing is the back office of the company - the number of machines, equipment and their condition.

However, even city cleaning plants should invest in a website - it should include the company's range of services, information about the company, history of winning tenders, photos of vehicles and contact details.