Closing and reopening a business and a cash register

The legislator narrows the group of entrepreneurs who are not obliged to record sales to natural persons who do not conduct business activity and flat-rate farmers with the help of a fiscal cash register. Entrepreneurs who first ran a business and had to have a cash register, then liquidated this activity and then reopened it are not exempt from this obligation - these people cannot benefit from the exemption from the obligation to have a cash register due to the turnover limit. Check how closing and reopening a business affects the obligation to have a cash register in the company.

The general principle of using the cash register in the company

As a rule, the provisions on VAT impose on taxpayers the obligation to use cash registers when they sell to natural persons who do not conduct business activity and to flat-rate farmers.

The catalog of activities covered by the cash register order is quite wide and covers both supplies and services. However, the legislator provided for exemptions from this obligation, e.g. due to the turnover or the nature of the business.

Who is required to have a cash register

The Ordinance of the Minister of Finance on exemptions from the obligation to keep records with the use of cash registers stipulates that the taxpayers who provide the following services must absolutely have a cash register:

1. passenger transport in car communication,
2. transport of people and their hand luggage by taxis,
3. repair of motor vehicles and mopeds (including tire repair, fitting, retreading and regeneration),
4. as regards the replacement of tires or wheels for motor vehicles and mopeds,
5. in the field of tests and technical inspections of vehicles,
6. in the field of medical care provided by doctors and dentists,
7. legal,
8. tax consultancy,
9. food-related (PKWiU 56), only:
1. provided by stationary catering establishments, including seasonally, and
2. food preparation services for external recipients (catering),
10. hairdressing, beauty and cosmetology
11. cultural and entertainment - only in the scope of admission to circus performances,
12. related to entertainment and recreation - only in the scope of admission to amusement parks, amusement parks, discos, dance halls.

and delivery:

1. liquid gas,
2. engine parts (PKWiU 28.11.4),

3. internal combustion engines of a kind used for propulsion of vehicles (PKWiU 29.10.1),

4. bodywork for motor vehicles (PKWiU 29.20.1),

5. trailers and semi-trailers; containers (PKWiU 29.20.2),

6. parts of trailers, semi-trailers and other vehicles without mechanical drive (PKWiU 29.20.30.0),

7. parts and accessories for motor vehicles (excluding motorcycles) not elsewhere classified (PKWiU 29.32.30.0),

8. internal combustion piston engines of a kind used in motorcycles (PKWiU 30.91.3),
9. radio, television and telecommunications equipment, excluding electron tubes and other electronic components as well as parts for apparatus and devices for sound and image manipulation, antennas (PKWiU ex 26 and ex 27.90),
10. photographic equipment, excluding parts and accessories for photographic equipment and accessories (PKWiU ex 26.70.1),
11. goods made of precious metals or with the participation of these metals, the supply of which cannot benefit from the exemption from the tax referred to in article 2. 113 paragraph. 1 and 9 of the VAT Act,
12. recorded and unsaved digital and analog data carriers,
13. products intended for use, offered for sale or used as motor fuels or as additives or admixtures to motor fuels, regardless of the PKWiU symbol,
14. tobacco products (PKWiU 12.00), alcoholic beverages with an alcohol content above 1.2% and alcoholic beverages containing a mixture of beer and non-alcoholic beverages with an alcohol content exceeding 0.5%, regardless of the PKWiU symbol, excluding goods delivered on board airplanes ,
15. perfumes and toilet waters (PKWiU 20.42.11.0), excluding goods delivered on board airplanes.

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Cash register - exemption due to turnover

Exemption from the cash register related to the turnover limit is one of the most popular discounts provided by the legislator. The tonnage-related exemption applies to all entrepreneurs that do not fall into the group described in the above paragraph of this article. Only sales to natural persons not conducting business activity and flat-rate farmers are taken into account for the limit.

The exemption due to the turnover is mentioned in the regulation of the Minister of Finance on exemptions from the obligation to keep records with the use of cash registers:

§ 3 clause 1 of the Regulation of the Minister of Finance on exemptions from the obligation to keep records with the use of cash registers:

1. Released from the obligation to record in a given tax year, but not longer than until 31 December 2021:

1) taxpayers whose turnover for natural persons who do not conduct business activity and flat-rate farmers did not exceed the amount of PLN 20,000 in the previous tax year, and in the case of taxpayers starting in the previous tax year, the supply of goods or services to natural persons who do not conduct business activity, and flat-rate farmers, if the turnover on this account did not exceed, in proportion to the period of performing these activities in the previous tax year, the amount of PLN 20,000;

2) taxpayers starting after 31 December 2018 the supply of goods or services to natural persons who do not conduct business activity and flat-rate farmers, if the turnover expected by the taxpayer in this respect does not exceed, in proportion to the period of performing these activities in a given tax year, the amount of PLN 20,000.

Thus, a taxpayer whose sales to individuals in the previous tax year did not exceed PLN 20,000 or started a business during the tax year, and whose turnover this year did not exceed the proportional value, converting the limit of PLN 20,000 to the length of business in a given year, does not need to purchase a cash register.

The above limit applies to both active VAT payers and exempt entities. Active VAT payers set the turnover limit based on the net value of sales, while entities exempt from VAT in gross amounts.

Closing and re-opening a business will not save you from the cash register!

What to do if:

• the taxpayer ran a sole proprietorship for several years,

• he provided services to natural persons who do not conduct business activity and flat-rate farmers,

• was obliged to have a cash register and record sales for private persons and flat-rate farmers on it,

• then closed the business,

• and after some time it will re-open a business with the same profile and will sell to non-business natural persons and flat-rate farmers?

In such a situation, will the taxpayer be able to use the sales limit of PLN 20,000 to private individuals before installing the cash register?

Well no. Closing and re-opening a business does not allow this. If the taxpayer exceeded the limit in the previously conducted sole proprietorship, then closed it and reopened it, providing services to private persons and flat-rate farmers, then he cannot take advantage of the limit of PLN 20,000 exempting him from the obligation to purchase a cash register. Instead, it has to install a cash register before making the first sale to the above-mentioned customers.

The regulations are designed in such a way as to prevent taxpayers from escaping the obligation to register sales at the cash register.