The competent tax office for VAT and PIT - how is it determined?
One of the most important obligations of every entrepreneur is submitting a tax declaration and paying tax to the appropriate tax office. Therefore, before starting the activity, the taxpayer should find out to which tax office is subject, and more precisely, which office will be competent for him in terms of VAT and which in terms of income tax. How to determine the competent tax office?
The competent tax office for income tax settlements
In accordance with par. 4 Regulation of the Minister of Finance of August 22, 2005 on the properties of tax authorities, the local jurisdiction of tax authorities in matters of personal income tax is determined according to the place of residence.
There is one exception to the above recipe. It concerns taxpayers taxed on the basis of a tax card. According to Art. 29 (3) of the Act on flat-rate income tax on certain revenues earned by natural persons: Locally competent for income tax paid in the form of a tax card is the head of the tax office according to the location of the organized establishment, indicated in the application for the register of economic activity, and in the event of failure to register the activity in the register or if the activity is carried out without having an organized establishment - according to the place of residence of the taxpayer or the seat of the partnership, and if the seat of the partnership cannot be determined - according to the place of residence of one of the partners.
Change of the place of residence and the jurisdiction of the tax office for PIT settlements
If the entrepreneur changes his place of residence during the tax year, the tax office competent for income tax settlements will also change.
In such a situation, the jurisdiction of the tax office is determined according to the place of residence on the last day of the settlement period to which the settlement of the PIT advance payment relates.
The change of the place of residence and the change of the competent tax office are reported by updating the CEIDG-1 application within 7 days from the date of the change.
The competent tax office for VAT settlements
As of January 1, 2016, the jurisdiction of the tax office for VAT settlements has changed. Currently, in the case of sole proprietorships, the competent office for VAT settlements is the tax office in accordance with the place of residence of the taxpayer, i.e. the same as for income tax settlements.
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Change of the place of residence and the competence of the tax office for VAT settlements
In a situation where a VAT payer changes his place of residence, apart from submitting an update of the CEIDG-1 application, he is also obliged to report this fact on the VAT-R application. The VAT-R application should be submitted to the "new" tax office within 7 days from the date of the change.
If the properties of the tax office change during the settlement period, the competent office for VAT settlements will be the one that was competent on the last day of this period, i.e. the last day of the month - for monthly VAT settlements or the last day of the quarter - for quarterly VAT settlements.
Therefore, entrepreneurs running a sole proprietorship settle both income tax and VAT in one tax office competent for the place of residence. The place of residence is understood as the place where the taxpayer is staying with the intention of permanent residence.