You will pay real tax on selling virtual items
Trading in virtual objects and currencies is becoming more and more popular every year. Examples include trading characters or equipment in online games or selling Bitcoin. No one should be surprised by the fact that the income from such transactions - if it is connected with receiving real money - should be taxed with income tax, and sometimes also with tax on goods and services.
Virtual sales are real profit and personal income tax
The issue of taxation of revenues obtained from the sale of such virtual objects or currencies has not been separately regulated in any regulations, therefore in this case general rules regarding income in general should be applied. When it comes to income tax, the most important thing is to establish the source of your income. The dilemma in the case of profit from the sale of virtual goods may concern the choice of one of three sources - due to property rights, business activity or other sources. As it turns out, each of them may be appropriate depending on the circumstances.
As the Ministry of Finance points out in its explanation regarding the taxation of the sale of Bitcoin and virtual items, each case of this type is different, and therefore requires a separate analysis and assessment. In the case of online games, the provisions of the regulations are important. If it is indicated in them that the player has only the right to grant a license to use a virtual item or character (and their owner is still, for example, the game publisher), then the income from such a transaction should be classified as coming from proprietary rights (Article 10 par. 1 point 7 of the Personal Income Tax Act - hereinafter referred to as the PIT Act).
It may also happen that the regulations do not contain a provision on the sale of the license, and therefore the virtual item will actually be sold. In such a case, the income will come from other sources, in accordance with Art. 10 sec. 1 point 9 of the PIT Act.
At this point, it is worth noting that in both cases described above, the income obtained from the sale of virtual goods will be taxed according to the tax scale (18% or 32%).
The sale of virtual currency also creates a tax liability
Also, selling a virtual currency such as Bitcoin is not tax-free. For this type of transaction, the other sources mentioned above will be the appropriate source of revenue. The sale of virtual money, resulting in a real profit, will be subject to taxation on general principles.
Making money selling virtual items can also take the form of a business. In such a case, taxpayers obtaining revenues from this type of transactions settle as other entrepreneurs, qualifying the profit obtained from them as coming from non-agricultural economic activity (Article 10 (1) (3) of the PIT Act).
They have the right to tax this income both on general terms, using 19% of the income tax. a flat rate, or by choosing a flat rate on recorded revenues (then the appropriate rate is 3%). This applies to the sale of virtual items as well as Bitcoin currencies.
Sales of virtual items and VAT
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Take advantage of the expert advice of the Entrepreneur's Guide
Online advice for businessesThe issue of taxing the sales in question with tax on goods and services applies only to taxpayers conducting business activity. The transaction of selling this type of thing should be treated as the sale of electronic services within the meaning of art. 2 point 26 of the VAT Act. If the player provides such services in a continuous and organized manner, he may be considered a VAT payer who should register with the tax office. In practice, such an obligation will appear only after he exceeds the annual sales limit of 150,000. PLN (pursuant to Article 113 (1) of the Act). The correct VAT rate that the player should apply in such a situation is 23%.
One should also bear in mind the issue of exporting electronic services, i.e. sales to foreign contractors. In certain cases, depending on the taxpayer's status, it may be necessary to tax such a transaction in Poland.
Importantly, in the case of sales of virtual items and currencies that are not subject to tax on goods and services, it may be necessary to pay the tax on civil law transactions (PCC). In this case, a rate of 1% should be applied, and the obligation to pay the tribute will rest with the buyer.
As you can see, even carrying out transactions in the virtual world can have real consequences and arouse the interest of the most real Ministry of Finance.