Anti-crisis shield: Relief for bad debts in CIT 2020

The new regulations of the anti-crisis shield waive, under the so-called relief for bad debts, the obligation to increase income constituting the basis for calculating advance payments for the unpaid liabilities related to commercial transactions.

Relief for bad debts - new deduction for entrepreneurs also during pandemic

The relief for bad debts provides for an exemption from the obligation to increase the income used to calculate the advance payments in 2020 by the unpaid liabilities of the taxpayer related to the purchased goods and services.

CIT taxpayers who benefit from this relief, starting from the advance payment due for March 2020, are not obliged to take into account the amount of unpaid liabilities when calculating the advance payment base, even if the failure to pay is due to lack of funds resulting from the coronavirus epidemic.

The relief for bad debts relates to advances for the period from March to December 2020 and does not provide for a minimum or a maximum amount at which the increase in income used to calculate the advance payment base shall be waived. Moreover, the right to reduce the basis for calculating the advance payment by the debts, i.e. receivables not yet collected by the taxpayer, in respect of goods or services sold also remains in force.

The relief can be granted to all entrepreneurs (regardless of the legal form of business activity, the status of the entrepreneur and the form of taxation applied) who have suffered negative economic consequences due to the SARS-CoV-2 virus epidemic and their revenues have decreased by at least 50% as compared to 2019.


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Agata Nie┼╝ychowska
Agata Nie┼╝ychowska
Tax Director, Partner