The interest on tax arrears is not a tax expense

Timely payment of tax obligations is not always possible for entrepreneurs due to various - often unpredictable - circumstances. Often, these factors depend on the nature of the taxpayer - some people forget to make a transfer on time, while others use the available funds first for other purposes. There are also entrepreneurs who pay their liabilities conscientiously and on time. In the latter case, delays may result from the fault of contractors, as a result of which a reliable businessman does not have sufficient funds due to untimely payment for delivered goods or services rendered. Regardless of the situation, each taxpayer in the event of untimely payment of liabilities must bear the consequences specified in the relevant provisions. Interest is mentioned first of all.

Art. 53 of the Tax Ordinance constitutes the legal basis for calculating tax interest. The amount of interest is determined by the Minister of Finance and then announced in the Monitor Polski. The amount of tax interest is twice the basic interest rate on the Lombard loan, additionally increased by 2%.

Taxpayers who, for various reasons, have not been able to pay their tax liabilities on time, should add interest in this situation. The correct calculation of interest is due from the day following the payment deadline to the date on which the outstanding tax liability was paid. The exception to this rule are the dates falling on public holidays (e.g. Sunday) - then the date is postponed to the first working day.

Entrepreneurs who have problems with calculating tax interest can use interest calculators. Thanks to this, the calculations are limited to specifying the amount in arrears and specific dates - the value of interest is calculated automatically. It is worth remembering that interest is not charged when the total amount is not more than three times the amount of the postage (currently PLN 2.90) - in total it is PLN 8.70 (3 x PLN 2.90).

It would seem that since the taxpayer pays the interest - and thus incurs the expense - it may include it in tax deductible costs. However, as it turns out, in accordance with Art. 23 section 1 point 18 of the Personal Income Tax Act, in the case of tax interest, there is no such possibility - "Late payment of late payment of budget receivables and other receivables, to which the provisions of the Act from on August 29, 1997 - Tax Ordinance. This means that the interest is not tax deductible and cannot be recognized in the tax revenue and expense ledger.

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Interest may also occur when the entrepreneur pays tax liabilities on time, where arrears arise due to adjustments in the current period. In this situation, the taxpayer is required to charge interest from the date of payment of the principal. As in the above case, interest cannot be recognized in the tax revenue and expense ledger, and therefore does not constitute a tax deductible cost.

To avoid the situations discussed above, it is best to simply pay your tax liabilities on time, although it is not always possible for the entrepreneur. It should be remembered that the necessity to pay interest arises after exceeding the amount of PLN 8.70. It is not worth postponing the fee, because it may quickly turn out that the company is indebted for a much larger amount, which additionally cannot be counted as costs.