The beginning of the year is not only a time for planning but also for recapping the past year. Businesses must fulfill a number of obligations related to tax settlements. Among them is submitting an annual tax return on advance payments (PIT-4R) and an annual return on income and advance payments (PIT-11).
Although the names of both forms sound similar, there are significant differences between them.
PIT-4R
It is submitted to the tax office by the employer, including those employing under contracts of mandate and contracts for specific work. This form demonstrates the employer's compliance with its obligations as an income tax payer, which it fulfills by collecting advance payments for employee income tax. It lists all taxpayers for whom advance payments were collected and their amounts. It is submitted exclusively to the tax office responsible for the employer.
However, due to the numerous tax reliefs available to employees and the higher tax-free amount, employers are not always required to collect tax advances. The question then arises whether they should also prepare a PIT-4R form in such a situation. However, the answer is not clear. If the employer did not collect advance payments during the year because the employee benefits from tax exemptions for young people, seniors, those returning from abroad, or for employees with at least four children, the employer does not have to include them in the PIT-4R form as long as the income does not exceed the exemption amount (PLN 85,528). However, a PIT-4R form must be filed if the employer did not collect income tax advances due to the employee's low income. Similarly, a PIT-4R form must be filed if the payer did not employ any employees in 2023 but paid the salary for December 2022 in January 2023.
PIT-11
It is submitted to the tax office and delivered to the employee. Unlike the PIT-4R, the tax office responsible for submitting this form is the employee's tax office. The form is prepared separately for each employee. It includes information on income, tax-deductible expenses, income (including tax-exempt income), and any advance payments collected.
The obligation to prepare a PIT-11 form arises regardless of whether the employer received advance payments during the year. The only relevant factor is whether the employee earned income. Therefore, if remuneration is paid monthly in advance, if the employee was hired in December, a separate form must be prepared. However, if remuneration is paid in arrears, the employer is not obligated to do so.
Deadlines
Both the PIT-4R and PIT-11 forms must be submitted to the tax office by the end of January. Submissions are only possible electronically, for example, via e-Deklaracje. The PIT-11 must be delivered to the employee (in paper or electronic format) by the end of February.
Failure to meet deadlines is punishable by a fine. To avoid penalties, submit the required forms as soon as possible and file an active complaint.
Your e-PIT for entrepreneurs
As announced by the Ministry of Finance, this year, for the first time, a completed annual tax return will be available for sole proprietors (SMEs). The PIT-36 returns will be available for sole proprietors, the PIT-36L for those taxed on a flat-rate basis, and the PIT-28 for those taxed on a flat-rate basis. Unlike the returns filed by individuals earning income from an employment contract (PIT-37), the returns for sole proprietors will only be partially completed. The tax office does not have information about income earned during the tax year or tax-deductible expenses. Social security contributions and available tax relief will also need to be entered separately. The 2023 annual return must be filed between February 15 and April 30, 2024.
This article is for informational purposes only and does not constitute legal advice.
Legal status as of January 29, 2024
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