As of 1 January 2015 the amendment of laws on income taxes will come into force. It will cover, among others, the catalogue of events which trigger revenue generation on the part of a business.

Until now, revenue from sale of assets not included under fixed assets in principle did not have to be disclosed as revenue from non-agricultural business activity. So it was possible to sell a real property not included in the records of fixed assets without an obligation to pay tax after the lapse of 5 years from the end of the year of purchase. However, as of the new year businesses will have to disclose revenue from sale of assets, even if such assets have not been entered to the records. It is enough that the property has been used in business activity.

Marcin Sobieszek, our tax advisor and Partner in ATA TAX, comments on the amendments of income tax regulations in the Rzeczpospolita daily.

- Under pretence of clarifying the regulations, the Ministry of Finance has introduced a new category of revenues from disposal of business assets. At the moment, for example, entrepreneurs who buy a car to their business but decide it will be used for a period shorter than one year so consequently it is not treated as a fixed asset may avoid the tax. The car can be accounted for under costs and no revenue has to be disclosed at the time of its sale. Similar is the case of entrepreneurs who use a real property in the activity, without depreciating such property but including operating expenses under costs. After the new year revenue from sale of such assets will be disclosed in the business. This will not apply, similarly as now, to residential real properties (unless the entrepreneur’s activity consists in trading with such properties). No tax will have to be paid in the case of selling equipment of up to PLN 1,500.

The entire article may be found in the electronic edition of Rzeczpospolita at www.prawo.rp.pl