About True Balance

A true balance is not the account balance.

True Balance means "prawdziwy bilans" in Polish. The concept can be confusing, especially for people outside accounting: there may be no money in the account, while the books show a profit and tax to pay.

That is why we put the two pictures side by side. Every month we show the management board the profit from the books next to the account balance and explain the difference. This is what Limited company accounting looks like with us, and our day-to-day cooperation is described on the How we work page.

The money is spent on the warehouse, the tax on profit remains

We tell the story of the name using the example of a company that buys a storage warehouse in December.

The company had a profit of one million and in December bought a warehouse with it: zero in the account, while tax for that year is calculated on the whole million.

• 2026: sale of goods and service costs: in the account (balance) PLN 1,000,000, in the books (year-to-date result) PLN 1,000,000, payable (what, how much, deadline) none
• December 2026: purchase of a warehouse with land for PLN 1 million: in the account (balance) PLN 0, in the books (year-to-date result) PLN 1,000,000, payable (what, how much, deadline) CIT for 2026 (9%) PLN 90,000 (deadline: 31.03.2027)
• 2027: sales and costs as in 2026, payment of CIT for 2026, instalment of the building cost: in the account (balance) PLN 910,000, in the books (year-to-date result) PLN 980,000, payable (what, how much, deadline) CIT for 2027 (9%) PLN 88,200 (deadline: 31.03.2028)

Gap: spent on the warehouse with land in 2026 minus the cost of the warehouse in the 2026 result · PLN 1,000,000 · 25.0% of revenue (PLN 4,000,000)

We give the step-by-step calculation and the legal basis at the end of the page.

Informational material, not tax or legal advice; examples use fictitious data; legal status as of 2026-09-27.

A warehouse bought in December does not reduce the tax for that year by even a zloty

Mechanism: straight-line depreciation of a non-residential building at 2.5%.

Sample limited liability company (fictitious data, sample amounts), trading in goods, revenue PLN 4,000,000 per year. Period 1 (2026: sale of goods and service costs): proceeds from the sale of goods PLN 4,000,000, payment for those goods PLN 2,000,000, sales service costs (employees, office and other) PLN 1,000,000, all paid in 2026; PLN 1,000,000 each in the account and in the result. Period 2 (December 2026): the company buys a new storage warehouse with land for PLN 1,000,000: the contract states separately the building price of PLN 800,000 and the land price of PLN 200,000; the warehouse is put into use and entered in the fixed assets register in December 2026; 800,000 + 200,000 = PLN 1,000,000 leaves the account (balance PLN 0), and the 2026 result does not change: depreciation of the building starts in January 2027, and land is not depreciated at all; CIT for 2026: 9% × PLN 1,000,000 = PLN 90,000, deadline 31.03.2027 (Wednesday, a business day). Period 3 (2027): sales and costs as in 2026 (proceeds PLN 4,000,000, payment for goods PLN 2,000,000, service costs PLN 1,000,000) and payment of CIT for 2026 of PLN 90,000: in the account 0 + 4,000,000 − 2,000,000 − 1,000,000 − 90,000 = PLN 910,000; the 2027 result calculated from zero: 4,000,000 − 2,000,000 − 1,000,000 − depreciation of the building for 12 months (PLN 800,000 × 2.5% = PLN 20,000) = PLN 980,000; CIT for 2027: 9% × PLN 980,000 = PLN 88,200, deadline 31.03.2028 (Friday, a business day).

The warehouse is a fixed asset: a non-residential building whose price is not a cost on the date of purchase (Article 16(1)(1)(b) of the CIT Act). The tax-deductible cost arises gradually, and the mechanism is tax depreciation: straight-line charges on an amount that is the initial value of the building (here the building price from the contract), at a rate of 2.5% per year (Table of annual depreciation rates, item 01), starting from the month following entry in the register (Article 16h(1)(1), Article 16i(1)). With a purchase in December, the depreciation charge for the year of purchase is PLN 0, and tax is calculated on the excess of revenue over the year's costs (Article 7(2)), that is, on the full result. One-off depreciation does not cover buildings: Article 16k(7) and (14) concern selected groups 3–8 of the Classification of Fixed Assets (KŚT), and buildings belong to group 1. Land is not depreciated at all (Article 16c(1)): its price becomes a cost only on a paid disposal (Article 16(1)(1), final sentence). Cash therefore leaves on the day of purchase, while the cost of the building is spread over 40 years (at 2.5% per year).

Assumptions: account balance and result at the start PLN 0; net amounts, sales and expenses paid in the year to which they relate (without unsettled invoices at year end); service costs are entirely a cost of the given year; the warehouse is new (previously unused), an above-ground non-residential building: Table of annual depreciation rates, item 01, Classification of Fixed Assets (KŚT) symbol 10 (non-residential buildings), rate 2.5% per year, straight-line method, without increased rates (Article 16i(2) of the CIT Act) and individual rates (Article 16j); depreciation in the books adopted as in tax (2.5% per year from January 2027), so the result in the books equals the tax result; initial value of the building = building price from the contract PLN 800,000; land PLN 200,000, without depreciation; year's result = revenue − value of goods sold − service costs − depreciation of the building; CIT 9% for 2026 and 2027, small taxpayer: gross sales (including VAT) in the previous year (2025, and for 2027: 2026) ≤ the equivalent of EUR 2 million (NBP rate from the first business day of October of the previous year), the year's revenue (PLN 4,000,000) ≤ the equivalent of EUR 2 million (NBP rate from the first business day of the year), no exclusions under Article 19(1a)–(1c) of the CIT Act (among others, the company was not formed in 2025–2027 by transformation, merger or division or by contribution of an enterprise, did not contribute an enterprise in kind in those years, and is not a tax capital group); without these conditions the rate is 19%; the company settles CIT under general rules: it has not chosen the lump-sum tax on company income (Chapter 6b of the CIT Act, Articles 28c–28t); tax = 9% of the year's result, rounded to full zlotys; gap = expenditure on the warehouse with land in 2026 (PLN 1,000,000) minus the cost of the warehouse in the 2026 result (PLN 0) = PLN 1,000,000, that is 25% of revenue.

Simplifications: we omit (1) CIT advance payments during the year: by default they are calculated at 19%, and at 9% only if a small taxpayer opts for it, for periods in which its revenue from the beginning of the year has not exceeded the equivalent of EUR 2 million (Article 25(1f)–(1g) of the CIT Act); a small taxpayer may also pay quarterly advances by the 20th day of the month after the quarter (for the fourth quarter: by 20 January of the following year, unless it files its return and pays the tax earlier), and by the return deadline it settles the difference between the tax for the year and the advances paid (Article 25(1b)–(1c) and Article 27(1) of the CIT Act); the tax for each year does not change (PLN 90,000 and PLN 88,200) regardless of the advance rate: in 2026 the money for advances would have left the account even before the warehouse purchase (with advances at 9%: part of the tax for the year, at 19%: even more than the whole tax for the year), and the balance at the end of 2027 would be lower by the advances for the first to third quarter of 2027 (with advances at 19%: by more); (2) VAT: amounts are net, the company deducts the VAT paid on purchases, so it does not change the result; (3) taxes and fees related to the warehouse purchase (e.g. notary): as a rule they increase the acquisition price (Article 16g(3) of the CIT Act), that is the basis of the cost instalments, and not the cost of 2026; (4) profit distribution: after buying the warehouse the company has no money for it in 2026; (5) subsequent years: the annual instalment of the building cost continues until its entire price is settled, and the price of the land becomes a cost only on sale (Article 16(1)(1) of the CIT Act, final sentence); (6) month of purchase: with a purchase earlier in the year, depreciation for the remaining months would reduce the result of the year of purchase by only a fraction of the building price (2.5% per year). None of them reverses the conclusion: in the year of purchase the money leaves the account in full, while the result and the tax practically do not change.

How True Balance helps: True Balance provides Limited company accounting (including spreading the building price into annual cost instalments) and shows the management board the result and the tax next to the account balance. The cash flow planning module forecasts the balance and warns of a cash shortfall: a period in which the account may run out of money, for example for tax after a large purchase. For such a period the module shows the message "Payment deadlines need to be moved." Tax advice on planned investments is provided by an external partner we work with.

The cash flow planning module is the Forecast module in the My True Balance platform. We implement this module for a limited number of our accounting clients. The scope of connections is agreed during implementation.

Informational material, not tax or legal advice; examples use fictitious data; legal status as of 2026-09-27.