Inventory surpluses and shortages in the KPiR


Entrepreneurs operating on the basis of the tax revenue and expenditure ledger at the end of the tax year are required to make a physical inventory. If, when creating the inventory, it turns out that there are surpluses or shortages in goods, it is necessary to update the kept records. Although this phenomenon is common, it repeatedly causes problems for entrepreneurs in terms of correctly demonstrating the differences in the KPiR.

What is included in the physical inventory?

As it results directly from § 24 par. 1 of the Regulation of the Minister of Finance on keeping a tax book of revenues and expenditures, taxpayers are required to prepare and enter in the book at the end of each tax year a physical inventory:

  • commercial goods,
  • basic and auxiliary materials (raw materials),
  • semi-finished products,
  • work in progress,
  • finished products,
  • shortages and waste.

Materials and commercial goods included in the inventory should be valued no later than 14 days from the date of its completion. The valuation should be carried out according to the purchase or acquisition prices or market prices on the date of the inventory (if they are lower than the purchase or acquisition prices).

Importantly, the inventory should also include goods that are the property of the taxpayer, located on the date of the inventory outside the establishment, as well as foreign goods in his possession. The latter are not subject to valuation, it is enough to enter them quantitatively in the list with an indication of whose property they are.

Not all shortages may be a cost

In a situation where, after drawing up the physical inventory, the entrepreneur finds that the warehouse records are inconsistent with the actual state (i.e. shown in the inventory), he is obliged to bring the inventory to the actual state. Inventory differences may occur in the form of:

  • shortage of goods - the actual state is lower than the inventory status,
  • surplus goods - the actual state is higher than in the records.

If any of the above-mentioned situation, in the first step it should be checked whether they are not a consequence of incorrect recording of revenues and expenses of goods in the warehouse records in the past.

The shortage of goods requires an investigation and appropriate documentation of the identified differences. For this purpose, protocols describing non-conformities and their causes are prepared. They should be accompanied by a written explanation of materially responsible persons. This is an important procedure because in a situation where the shortage was caused by carelessness or deliberate action by the taxpayer, then it cannot be a tax deductible cost.

Surpluses and shortages - records

The value of purchased commercial goods is required by the taxpayer in column 10 of the KPiR - purchase of commercial goods and materials according to purchase prices. If, during the preparation of the physical inventory, a faultless shortage is found, its value should be derecognised from the aforementioned column 10 (entry preceded by a "minus" sign) and entered into column 13 - other expenses.

The situation is different when the shortage arises from the fault of the taxpayer and therefore cannot constitute a tax deductible cost. In this case, the correct action will also be to write off the value of the identified shortage from col. 10, but due to the taxpayer's fault, it is not entered into any other column (the costs are completely derecognised).

If the taxpayer finds a surplus of goods during the physical inventory, then its value is income for him. This value should be entered in the column 8 - other income.

Example 1.

Jan Kowalski runs a sole proprietorship (stationery shop) and settles accounts based on the KPiR. On December 31, 2020, he made a physical inventory. He compared its value with the record status and found the following shortages in goods:

  1. 4 reams of printer paper, purchase price PLN 15 (per piece) = PLN 60

  2. 7 sets of felt-tip pens, purchase price PLN 11 (per piece) = PLN 77

Total shortages: PLN 137

After verifying the stock levels, Mr. Jan stated that all commercial goods were correctly recorded, and therefore the shortages were most likely the result of theft. In the created protocol, the taxpayer emphasized the sporadic nature and small scope of the identified losses. On the basis of the documents created (Protocol 1/2020), on December 31, 2020, Mr. Jan made a reclassification of their values ​​in the KPiR.


Account number


Description of the economic event

Purchase of commercial goods and materials


Other expenses









Protocol 1/2020


physical inventory shortages

- 137,00