Instead of a suspension - a break in business

Taxpayer - do you pay tax in the form of a tax card? You do not have to suspend your business activity, and you can report a break in its conduct. What is the difference between one action and the other, and what their effects are, you will learn in the article below.

The possibility of reporting a break in business activity is directly regulated by Art. 34 of the Act of November 20, 1998 on flat-rate income tax on certain revenues earned by natural persons.

Who can report a business interruption?

A break in running a business may be reported by a person who pays tax on the basis of a tax card. For this purpose, it is sufficient to inform the head of the competent tax office in writing. The form of submitting the notification depends on the reason for the interruption. Above the Act distinguishes between a break caused by an illness and a break for other reasons, as provided for in Art. 34 sec. 1 and 2.

A break in business activities due to reasons other than illness must last at least 10 days. The taxpayer should notify the head of the tax office about the intention of the break at the latest on the day of its commencement, and about its completion on the day preceding its end.

In a situation where the break in business activity is caused by an illness, the taxpayer notifies the tax office about the period of the break after its end, on the day of restarting the activity. The notification should be made on the basis of a medical certificate.

Consequences of reporting a business interruption

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Reporting a break in business activity will only affect the amount of tax resulting from the tax card. However, it does not release the taxpayer from the obligation to pay ZUS contributions, as is the case with the suspension of business activity. Moreover, a break may be reported during the employment of employees.

During the break in conducting business activity, the taxpayer is exempt from the obligation to pay tax in the amount of 1/30 of the monthly fee for each day of the break. How does it look in practice?

Example 1.

The taxpayer pays the tax to the tax office every month in the form of a tax card.

He reported a break in business from June 16 to June 30, 2014.

Therefore, the taxpayer should pay 15/30 less advance payment of the tax due for June, i.e. he will pay the income tax in proportion to the days on which the activity was active.

During a break in business activity, the taxpayer may not perform activities falling within the scope of his activity. Reporting a break is not associated with additional fees to the tax office.