Natural inventory - everything you need to know?
Taxpayers keeping KPIR taxed on general principles and on a straight-line basis at the end of the year are required to prepare an inventory (physical inventory). Read the article and find out how to do it!
When to make a physical inventory
Pursuant to § 24 sec. 1 of the Regulation of the Minister of Finance on the conduct of KPIR, taxpayers are required to prepare a physical inventory at the end of each tax year, as well as on:
- commencement of operations during the tax year
- loss of the right to flat-rate income tax
- change of shareholder
- changes in the proportion of shares
- business liquidation
If the taxpayer has made a physical inventory as of December 31, there is no obligation to make another inventory as of January 1.
What do we include in the inventory?
§ 24 (1) of the Regulation on the conduct of the KPIR directly informs what should be included in the physical inventory. These are :
- commercial goods
- basic and auxiliary materials
- production in progress
- finished products
- shortages and waste
§ 25 clause 3 of the Regulation on the operation of the KPIR:
The physical inventory should also include goods owned by the taxpayer, located outside the taxpayer's establishment on the day the inventory was drawn up, as well as foreign goods located at the taxpayer's establishment. Foreign goods are not subject to valuation; it is sufficient to enter them quantitatively in the inventory of goods, specifying who they are owned.
Data that should be included in the physical inventory
The physical inventory should be made carefully and permanently. It should contain at least the following data:
- First and last name of the management board owner or company name
- Date of preparation
- Sequence number of the physical inventory sheet item
- Detailed definition of inventory components
- Measure unit
- Quantity found at the time of the census
- Price in zlotys and grosze per unit of measurement
- the value resulting from the multiplication of the quantity of the commodity by its unit price
- total value of physical inventory
- the clause "The inventory has been completed on the position ..."
- signatures of persons drawing up the list and signature of the plant owner (partners)
The exceptions are bookstores and antique shops, bureaux de change, and special agricultural production departments
- bookshops and antiquarian bookstores - a physical inventory can include one item of a publishing house of the same price, regardless of the name and surname of the author, divided into books, brochures, albums and others;
- currency exchange operations - the physical inventory should include unsold foreign exchange values;
- special departments of agricultural production - the physical inventory should include materials and raw materials not used in the course of production, as well as the number of animals by species, broken down by groups.
Valuation of inventory components
The taxpayer is obliged to evaluate the components included in the inventory on the basis of the purchase or acquisition price.
According to § 26 of the Regulation of the Minister of Finance on the conduct of the KPIR:
- commercial goods according to the purchase price, purchase price or market prices from the date of the inventory,
- Valuation at market value can be made when it is lower than the purchase or purchase prices, then the valuation takes into account the market prices used in the trade of items of the same type and type, taking into account in particular their condition and degree of wear,
- basic and auxiliary materials at purchase or purchase price or at market prices on the date of the inventory, if they are lower than the purchase or acquisition prices - the market prices used in the trade of items of the same type and type are taken into account, taking into account in particular their condition and degree wear
- semi-finished products are valued according to their manufacturing costs
- production in progress is measured at production costs, however, it should be remembered that it cannot be a value lower than the costs of direct materials used for work in progress.
- finished products are valued at manufacturing costs
- deficiencies are valued at manufacturing costs
- utility waste, which has lost its original value in use in the course of business, is valued at the value resulting from the estimation taking into account its suitability for further use.
Purchase price - this is the amount due to the seller reduced by the tax on goods and services, which is deductible in accordance with separate regulations, less rebates, discounts and other reductions. In the case of import, it is the value additionally increased by the due customs duty, excise tax and additional customs fees.
Purchase price - the purchase price of an asset plus incidental costs related to the purchase of goods and assets until deposited in the warehouse according to their purchase price, in particular the costs of transport, loading and unloading and insurance by way of
Cost of manufacturing - a product includes costs directly related to a given product and a justified part of costs indirectly related to the production of this product
Additionally, it is worth knowing that:
Foreign goods are not subject to valuation - it is sufficient to quantify them in the inventory of goods and indicate whose property they belong to.
The livestock production included in the physical inventory is valued at market prices on the date of the inventory, taking into account the species, group and weight of animals.
The valuation should be made no later than 14 days from the date of completion of the physical inventory.
Summing up the physical inventory should be made on December 31 of each year, on January 1 of the tax year, the entrepreneur enters the inventory in the book or records as at December 31 of the previous year, he is not obliged to carry out the inventory for the second time.