Cash accounting for taxes

According to announcements, a new tax solution will soon be introduced to make things easier for some individual business. It concerns a change in the rules regarding the recognition of revenue for individuals paying income tax (PIT). Currently, especially in business activities, amounts due are considered as revenue, even if they have not actually been received yet. This means that taxable revenue arises when an invoice is issued or goods are delivered.

As a result of the announced change, entrepreneurs would pay income tax only upon receipt of payment for goods or services. Such a mechanism would protect entrepreneurs from the consequences of unpaid receivables and bring the tax payment date closer to the payment of invoices, especially in cases involving agreed long payment terms.