When income from fees and commissions is generated


Entrepreneurs who grant loans as part of business activities may have doubts when they should show income from commissions received from borrowers, including interest. So the question is, when is the revenue from fees and commissions generated?

The moment when income from fees and commissions is generated

Pursuant to Art. 11 sec. 1 updof, the income is considered to be the money and cash values ​​received or made available to the taxpayer in the calendar year as well as the value of benefits received in kind and other free benefits. The income is the amounts due, even if they have not been actually received, excluding the value of the returned goods, discounts and discounts granted. However, in the case of taxpayers making sales subject to tax on goods and services, the revenue from this sale is considered to be revenue less the VAT due.


Pursuant to Art. 14 sec. 1c updof, the date on which the income arises is generally considered to be the date of delivery of the item, sale of the property right or performance of the service, or partial performance of the service, no later than the day:

  • issuing an invoice or

  • payment of receivables.


Thus, for tax purposes, revenues that have not yet been received, but are due to the entrepreneur, are subject to taxation.

Income from fees and commissions charged in subsequent billing periods

Lenders most often set the rules for the repayment of the loan (including commission) in the periods specified in the contract. Then, loan agreements contain a provision on the basis of which the service is billed in subsequent settlement periods (most often on a monthly basis). In such a situation, the due revenue arises on the last day of the settlement period specified in the contract that binds the parties or on the invoice issued, at least once a year.

Example 1.

Entrepreneur N granted the loan. The contract with the client was concluded for a period of 2 years. During this time, the client will pay monthly installments in the amount of PLN 700 (repayment of the principal installment with interest and a commission of PLN 50).

In the described situation, income from collected fees and commissions will be generated at the end of each month.

When should I show interest on a loan as income?

The question is whether the interest charged on the loan will constitute taxable income when it becomes due? In this situation, one should use Art. 14 sec. 3 point 2 updof. Pursuant to the aforementioned provision, revenues do not include amounts accrued but not received on receivables, including on loans granted. Thus, this provision postpones the moment of the emergence of interest income on loans granted to the date of their actual receipt.