Business interruption - is it possible?
Entrepreneurs who pay income tax in the form of a tax card do not have to suspend their business. Another solution they can take advantage of is the announcement of a business interruption. How are the two forms different?
Business interruption - for whom?
A break in running a business can be announced by people who pay income tax on the basis of a tax card. For this purpose, it is sufficient to inform the head of the competent tax office in writing. The form in which such notification is submitted depends on the reason why the trader decides to take a break.
The possibility of reporting a break in business activity is allowed by Art. 34 of the Act of November 20, 1998 on flat-rate income tax on certain revenues earned by natural persons.
Business interruption - types
The regulations mention a break in conducting business due to:
- other reasons.
The interruption in business for reasons other than illness must last at least 10 days. In this case, the entrepreneur should notify the head of the tax office about the intention to discontinue the operation of the company, no later than on the day of its commencement, and about its completion - on the day preceding the event.
If the business interruption is caused by an illness, the taxpayer shall notify the tax office of this fact after its completion, on the day of re-commencing business. Such notification should be made on the basis of a medical certificate.
Business interruption - effects
Reporting a break in business activity affects only the amount of tax resulting from the tax card. It does not release the taxpayer from the obligation to pay ZUS contributions, as happens when the activity is suspended. Moreover, such a break may also be reported during the employment of employees.
During the interruption in business, the taxpayer is exempt from the obligation to pay tax in the amount of 1/30 of the monthly fee for each day.
The entrepreneur pays income tax in the form of a tax card, reported a break in business from October 16 to October 30, 2014. This means that he should pay 15/30 less tax due for October.
Importantly, during a break in conducting business, the taxpayer may not perform any activities falling within the scope of his activity. However, reporting such a break does not involve any additional fees for the tax office.