Translation of accounting documents - is it always required?

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Polish entrepreneurs often purchase goods and services from foreign contractors for which they receive invoices in a foreign language. Do they have to translate them in order to properly account for the expense? Should the translation be done by a sworn translator? Let's check whether the translation of accounting documents is required by the regulations and how it should be properly carried out.

Translation of accounting documents according to regulations

The regulation of the Minister of Finance on keeping a tax book of revenues and expenses indicates that it should be kept on the basis of correct and reliable evidence, in Polish and in Polish currency, in a careful, legible and permanent manner. On the other hand, accounting documents should be prepared in Polish, and their content must be complete and understandable.

In conclusion, the translation of accounting documents is not a required obligation of the entrepreneur, failure to do so will result in a penalty. The most important issue is the interpretation of the document and its proper accounting in the KPiR. If the entrepreneur correctly understands the content of the invoice received and properly books the document, he is not obliged to translate it. Therefore, translating accounting documents is not a necessary obligation.

Translation of accounting documents and control

The entrepreneur does not have to translate foreign documents into Polish for his own purposes. However, in the event of a fiscal or tax inspection, at the request of the inspector, it should fulfill this obligation. There is little mention of the translation of accounting documents. The VAT Act and the PIT Act are silent on this matter. However, the confirmation is found in Art. 287 § 1 point 2 of the Tax Ordinance, which states that in the event of an inspection, the entrepreneur should: present, at the inspector's request, a translation into Polish of the documentation concerning the matters being the subject of the inspection, prepared in a foreign language.

In addition, it indicates that the entrepreneur is obliged to perform the translation at his own expense, in accordance with Art. 189 § 3.

Who should prepare the translation of accounting documents?

The entrepreneur is responsible for the translation. He can make it on his own, but in the event of accounting errors resulting from improper understanding of the received document, he will respond by himself.

In ordinary cases, the entrepreneur may translate the documents on his own for his own purposes. Sometimes, however, it will be necessary to use the services of a professional, especially if the controlling entity requires its preparation.

If it is necessary to translate the documents indicated by the inspector, it will be necessary to use the services of a sworn translator.

Costs related to the translation of documents

When using the services of translating company documents, the entrepreneur incurs an expense that can be booked as tax deductible costs. Including the expense as a cost should be documented with an invoice received from a translation company or a natural person who is not a sworn translator, on the basis of the invoice issued.

Posting of translation expenses in the wFirma.pl system

In the wFirma.pl system, users can easily book expenses related to the translation of company documents.

To do this, go to the tab EXPENDITURE »ADD AN EXPENSE» VAT INVOICE or INVOICE (EXCLUDING VAT).

In the window for adding an expense, fill in the required fields in accordance with the document received and mark the type of expense as "Other expenses related to business activity".

After saving, the invoice will be automatically entered in the KPiR in col. 13 as remaining expenditure and if the booking was made on the basis of a VAT invoice, then in the VAT purchase register (in the case of active VAT payers).