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New depreciation limits in Poland in 2025

31.12.2024

Along with the beginning of 2025, taxpayers can decide to make changes in depreciation. The process should be thought out because, as costs, depreciation write-offs have influence on tax optimization of the company. What are the new depreciation limits in 2025 and what changes in depreciation are possible at the beginning of the new year?

 

Adjustments of the frequency of depreciation write-offs

Depreciation is made, in equal instalments, each month, each quarter or as a once at the end of the year. The decision on the frequency of depreciation write-offs is made by the taxpayer. The said frequency cannot, however, be changed during the year (according to the Act of 15 February 1992 on corporate income tax). The changes can be used from the new year.

 

Replacing the declining balance method with straight-line depreciation

In case of the declining balance method, depreciation write-offs are higher than average (established with the straight-line method) in the initial periods of use of the fixed asset and gradually decrease. Depreciation write-offs will keep decreasing until the value of the written off loss becomes lower than the instalment established with the straight-line method. The taxpayer using the declining balance method is obligated to pay attention to the time (of the year) when they should switch to straight-line depreciation.

 

Change of depreciation rates

The taxpayer will be able to increase or decrease the depreciation rates multiple times. Changes in fixed assets that have already been put in the records is made in the first month of each consecutive fiscal year. Change of rates during the year is impossible. Rates can be changed only in the case of straight-line depreciation.

 

Limit for one-off depreciation in 2025: EUR 50,000

New business owners and small taxpayers can make one-time depreciation write-offs of fixed assets categorized as 3-8 of the Polish Classification of Fixed Assets (excluding passenger carsup to the amount that will not exceed the equivalent of EUR 50,000. A single write-off is made in the fiscal year in which the fixed assets were put in the recordsIn 2025, this limit will be PLN 214,000 (compared to PLN 230,000 in 2024).

 

Accelerated depreciation – for whom?

Micro, small and medium-sized businesses can determine the depreciation rates on an individual basis for internally generated tangible assets being non-residential buildings (premises) and structures classified in groups 1 and 2 of KŚT that were put in the records of fixed assets for the first time, as well as for intangible assets of the taxpayer in a situation when such a fixed asset is located within the territory of a commune:

  • located in a district where the average unemployment rate is at least 120% of the average unemployment rate in the country, and
  • where the ratio of income subject to taxation per capita in the commune is lower than 100% of the ratio of income subject to taxation for all communes.

Taxpayers can reduce the depreciation period to 5 or 10 years, depending on the unemployment rate.

Optimize Your Tax Strategy with Thoughtful Depreciation Planning! Contact us today and learn more.

 

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