After months of hard work, the imagination of exotic holidays, luxury hotel or long journey becomes a desired goal for many Poles. We save, plan, and yet spend crucial amounts to make our dreams come true. However, after returning, in addition to beautiful memories and tans, there may be an unpleasant surprise for any – a call from the taxation Office. In the public debate, there is an expanding amount PLN 15,000 as a symbolic threshold that exceeding on vacation expenses can draw the attention of the tax. Although it is no authoritative border, it is simply a signal that in the age of digital trace and financial transparency, the treasury has the tools to initiate control of undisclosed sources of revenueAnd the consequences can be devastating.
Why is the amount of PLN 15,000 and is it an authoritative limit?
It should be clear from the outset: There is no regulation that says that spending PLN 15,000 on vacation automatically triggers taxation control. This amount is contractual and symbolic. It represents the level of expenditure which for the average Pole is crucial and may propose having above average income.
The real reason for interest on the part of the taxation Office is not the fact that a large sum is spent, but gross disparity between documented authoritative income and surviving and consumption. If a individual who shows income at the minimum national level in his yearly PIT message abruptly spends 2 weeks in a five-star hotel in Maldives, a red lamp lights up for the taxation analyst. It is simply a signal that the spending of this individual far outweighs its legal earnings, which gives emergence to suspicion of the existence of undisclosed, and thus untaxed, sources of income.
How does the IRS find out about our vacation?
Many people feel that their private expenses are invisible to the tax. It's an illusion. In today's world, the IRS has access to many sources of information, and frequently we ourselves, unconsciously, supply it with evidence on a tray.
- Social media – a cognition mine: It is now 1 of the main sources. Facebook, Instagram or TikTok are full of photos and accounts of luxury travel. Public commendation of staying in an costly resort, marking exotic locations or posing with costly purchases is an open invitation to verify. IRS employees, like everyone else, usage the net and can connect facts.
- ‘Wish’ tips: It is inactive an highly popular method of obtaining information. A jealous neighbor, a bickering business partner, a erstwhile spouse or even a disgruntled worker may make an anonymous tip to the IRS, informing about the lavish lifestyle of a individual who does not match his authoritative earnings.
- Analysis of data and financial flows: Offices have access to data from different registers (e.g. property or cars). They may besides ask the bank, in justified cases, for information on the flows in the account. A large, one-off transfer to the travel agency account for the amount over PLN 15,000 may be noted and become a starting point for further analysis.
What is control, and what must we prove?
If the IRS considers that there is simply a suspicion of concealing income, it shall initiate proceedings. It usually starts with sending requests for clarification on the origin of appropriations to cover certain expenditure.
And here we come to a crucial moment: in specified a course the burden of proof lies with the taxpayer. We're the ones who gotta prove where we got the money for our luxury vacation. Legal and acceptable sources may be:
- Documented income from work, business activity, contract orders, etc.From which we paid the tax.
- Savings collected in erstwhile years (but besides from taxed sources).
- Bank debt or loan (requires the presentation of a contract).
- Donation or inheritance (requires proof and must be notified to the taxation Office in due time, even if it was exempt from tax).
- Revenue from the sale of assets (e.g. car or property), besides adequately accounted for.
If we are not able to reliably paper the origin of our money, we are facing very serious consequences.
Worst scenario: 75% taxation on undisclosed income
If we cannot prove the legality of our resources, the IRS will apply the sanction provided for in Tax legislation. It's a criminal offence, 75 % taxation rate the amount of undisclosed revenue.
Example: If we spent it on vacation PLN 20,000 And we can't paper where that money came from, and the IRS can consider it as our undisclosed income. In this case, it will charge a taxation of 75% out of PLN 20,000, which gives an astronomical amount PLN 15,000 to be paid. This is 1 of the most severe sanctions in Polish taxation law.
Expert comment: This is not a tourist hunt, but a grey zone
It should be stressed with all the strength: the aim of the taxation Office is not to prosecute Poles for going on holiday. If you gain legally, pay taxes, and even the most costly journey around the planet from your savings, you have absolutely no reason to be concerned. You can print photos and enjoy recreation.
The fiscal measures are aimed at grey zone – people who gain ‘black’ income do not registry their activities, hide their profits and at the same time do not deny themselves luxury consumption. Control of expenditure is 1 of the most effective tools to combat this.
The message from these activities is simple: we are surviving in a time where it is increasingly hard to live a double financial life. The discrepancy between what we show in the taxation message and what we show on Instagram has never been so easy to catch. Therefore, the best warrant of a peaceful vacation and the absence of problems upon return is simply transparency and honesty towards the tax.
Continued here:
Did you spend more than PLN 15,000 on vacation? The IRS can call on you to control “sources of income”
