Handing over of goods - donation, advertising, company needs


Commercial goods purchased by the entrepreneur may constitute a tax deductible cost. The expenditure should be entered in the tax revenue and expense ledger immediately after the purchase, at the latest before the goods are transferred to the warehouse, processing or sale. What happens if the taxpayer wants to change the purpose of using the commercial good? Is it possible to transfer commercial goods for other purposes? Let's check it out!

What are trading commodities?

Trade commodities are resources intended for sale in an unprocessed state and by-products obtained while running special departments of agricultural production. Purchase of trade goods should be recorded in the KPiR (in column 10. - “purchase of trade goods and basic materials”) and shown in the physical inventory at the end of the year. The following may be used as documentation of the transaction: invoices, bills and customs documents. The purchase of commercial goods from a natural person may be certified by a sales contract. In a situation where the entrepreneur first receives the goods and only then the invoice, he must draw up a description of the purchased commercial goods, which should include:

  • data and address of the supplier of commercial goods,

  • quantity and type of purchased goods,

  • unit price,

  • value of purchased goods,

  • date and signature of the person who accepted the goods.

This description will be the basis for an entry in the KPiR. Upon receipt of the invoice, the entrepreneur should attach to it the previously made entry and store it together.

Provision of commercial goods for other purposes

By definition, commercial goods should be sold unchanged by the trader. However, it sometimes happens that a taxpayer decides to use the purchased commercial goods for his own business or other purposes. Such a solution is possible, but one should remember to correct the provisions in the KPiR. Most often, commercial goods are used by an entrepreneur in his own business or for advertising purposes. It also happens that the taxpayer decides to donate them. It is worth finding out how to correctly record these activities in the KPiR and whether they have tax consequences for the entrepreneur.

Transfer of commercial goods for company purposes

In order to be able to use the purchased commercial goods for business purposes, the entry in the KPiR must be corrected. The expenditure should be moved from columns 10 to 13 - "Other expenses related to business activities". Reclassification of the measure should be documented with a protocol for the transfer of commercial goods to the company's needs, which should consist of the following elements:

  • document number,

  • description of the event,

  • dates,

  • the name of the transferred goods,

  • the value of the transferred goods.

It is worth remembering that the transfer of commercial goods for the purposes of the conducted activity does not necessitate the correction of the VAT charged by the entrepreneur at the time of their purchase.

Provision of commercial goods for advertising purposes

As in the case of the desire to use commercial goods for business purposes, an entrepreneur who wants to use the purchased commercial goods for advertising purposes should transfer expenses from columns 10 to 13. Also in this case, the basis for the correction of the entry will be an internal document drawn up at the time of reclassification of expenses.

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Donation of commercial goods

Donations may not be deductible for tax purposes. If the trader decides to hand over his trade goods free of charge, he will have to write them off from column 10. of the NAP. The value of commercial goods will be determined by the entrepreneur in accordance with the purchase price (an active VAT taxpayer takes into account the net price, and a taxpayer using the VAT exemption takes into account the gross price).

The donation should be documented on the basis of the donation agreement concluded in writing between the donor and the recipient. The document should contain at least:

  • date and place of preparation,

  • identification of the parties to the contract (names, addresses, serial numbers of ID cards),

  • specification of the subject of the donation along with the amount of goods transferred,

  • the recipient's declaration of acceptance of the donation,

  • identification of the party that bears the costs of concluding the contract,

  • signatures of the parties.

The value of the donation is determined on the basis of the prices of the transferred commercial goods. If the donation does not take place immediately at the time of drawing up the contract, the document should include the date of handing over the goods to the recipient. The recipient, on the other hand, is obliged to issue a declaration of acceptance of the donation.