Depreciation of fixed assets up to PLN 10,000 in Poland – rules and methods

Depreciation of fixed assets is one of the most important aspects of bookkeeping in any business. It is particularly important to understand the rules for assets worth no more than PLN 10,000, because special rules apply to this group of assets and give business owners more flexibility in choosing how to settle them.

Business owners who acquire fixed assets and intangible assets must expect to make depreciation write-offs – in equal monthly or quarterly instalments, or as a single write-off at the end of the tax year (Article 22h section 4 of the PIT Act). Depreciation is the monetary expression of the loss of value of a business's long-term assets and is a non-cash expense – it does not involve a direct movement of money when the write-off is booked.

Basic rules of depreciation under Polish tax law

Under the PIT (personal income tax) Act, depreciation write-offs are made when the initial value of a fixed asset or intangible asset on the day it is put into use exceeds PLN 10,000 (Article 22f section 3 of the PIT Act; for CIT (corporate income tax), Article 16f section 3 and Article 16d section 1 apply in the same way). At the same time, the asset must meet the definition of a fixed asset or intangible asset, which means, among other things, that its expected useful life is longer than one year. How write-offs translate into a lower tax bill is shown in our article on depreciation as a way to lower your tax.

Before depreciation starts, the business owner chooses the depreciation method for the fixed asset and applies it until the asset is fully depreciated (Article 22h section 2 of the PIT Act). The rates in the List of depreciation rates (Wykaz stawek amortyzacyjnych) may be reduced – from the month the asset is entered in the register or from the first month of each subsequent tax year (Article 22i section 5). Periodic review of depreciation periods and rates, on the other hand, is an obligation of entities keeping accounting books (Article 32 section 3 of the Accounting Act).

Depreciation write-offs are recorded in the KPiR (tax revenue and expense ledger) in column 15 – Other expenses (KPiR template in force from 1 January 2026, regulation Dz.U. 2025 poz. 1299; until 2025 this was column 13). This is the column in which business owners using simplified accounting record all depreciation write-offs, regardless of the method chosen.

When an asset is subject to depreciation

For the taxpayer to be required to make depreciation write-offs under the general rules, two conditions must be met at the same time: the value of the asset must exceed PLN 10,000, and its expected useful life must be longer than one year. These criteria are closely linked and determine how the asset is settled.

There are also opposite situations – where the value of an asset exceeds PLN 10,000 but the taxpayer does not intend to use it in the business for more than a year, the asset is not classified as a fixed asset or an intangible asset. In that case, no depreciation write-offs are needed, and the full purchase cost can be recognised as a tax-deductible cost in the current settlement period.

Depreciation rates set by law

The List of annual depreciation rates is set out in Annex 1 to the PIT Act. The rates differ depending on the type of fixed asset and reflect the actual pace at which different categories of assets lose value.

Machinery and equipment, depending on their type and purpose, may be depreciated at different rates, including: 7 per cent, 10 per cent, 14 per cent, 18 per cent, 20 per cent, 25 per cent or 30 per cent. The specific rate depends on how the equipment is classified under tax law.

One-off depreciation – a flexible solution

Where the initial value of an asset is PLN 10,000 or less, taxpayers can choose between depreciation under the general rules and a one-off depreciation write-off. The second option gives considerable flexibility in managing tax-deductible costs.

A one-off depreciation write-off means recognising the entire depreciation amount at once in other expenses. It can be made in the month the fixed asset or intangible asset is put into use or in the following month (Article 22f section 3 of the PIT Act). This flexibility allows business owners to manage their tax burden in a given year in the best way.

To use one-off depreciation, the asset must be entered in the register of fixed assets or intangible assets. This method cannot be used for assets recognised directly in costs as current expenses.

No depreciation obligation – when the cost can be expensed

There are situations in which no depreciation write-offs are needed for assets acquired or produced in-house. Under the PIT Act, where the initial value of an asset is PLN 10,000 or less, the expenditure on acquiring fixed assets or intangible assets can be recognised as a tax-deductible cost in the month they are put into use (Article 22d section 1 of the PIT Act).

This gives business owners a third way of settling assets worth no more than PLN 10,000:

1. Recognising the cost directly in the month the asset is put into use
2. Entering it in the fixed asset register with one-off depreciation
3. Entering it in the fixed asset register with straight-line depreciation at the statutory rates

Special situations requiring correction

Tax law also provides for special situations that may require later corrections in the settlement of assets. Where an asset with an initial value exceeding PLN 10,000 has not been classified as a fixed asset or intangible asset because its expected useful life was one year or less, and it is actually used for more than a year, taxpayers must take certain steps (Article 22e section 1 of the PIT Act).

In the first month following the month in which that year has passed, the business owner must:

1. Classify the asset as a fixed asset or intangible asset
2. Enter it in the register at its purchase price or production cost
3. Reduce tax-deductible costs accordingly by the difference between the purchase price and the depreciation write-offs attributable to the period of use so far (at the rates in the List)
4. Apply the depreciation rates set out in the Act throughout the depreciation period
5. Pay the tax office (urząd skarbowy) the interest charged for the relevant period

The interest must be paid by the 20th day of the first month following the month in which the asset's one-year period of use ended (Article 22e section 1 point 4 of the PIT Act). This is an additional financial burden that should be taken into account when planning the use of assets.

Practical aspects of record-keeping

Keeping records of fixed assets worth up to PLN 10,000 requires a well-thought-out approach to documentation and bookkeeping. Whatever settlement method you choose, each asset must be properly documented and described. We keep fixed asset registers and book write-offs for clients as part of our bookkeeping services.

A business owner running a trading business bought a computer worth PLN 8,000. He plans to use it for 4 years. He can choose between three options: recognising the whole amount as a cost in the month it is put into use, one-off depreciation after entering it in the fixed asset register, or straight-line depreciation at a rate of 30 per cent a year (PLN 2,400 a year, i.e. about 3 years and 4 months), or over 4 years at a rate reduced to 25 per cent.

The documentation for each asset should include:

• The purchase document with a precise description of the asset
• The date it was put into use
• The expected useful life
• The chosen settlement method
• The reasons for the decision

Impact on tax planning

The flexibility in settling assets worth up to PLN 10,000 gives business owners an important tax planning tool. The ability to choose between different methods makes it possible to spread the tax burden over time depending on the company's current financial situation.

In years with high revenue, business owners may prefer faster recognition of costs through:

• Recognising the cost directly in the month the asset is put into use
• Using one-off depreciation
• Using the maximum depreciation rates

In years with lower revenue, they may consider:

• Spreading costs over time through straight-line depreciation
• Using lower depreciation rates
• Postponing purchases to later periods

Checking and reviewing depreciation write-offs

In accounting books, the correctness of the depreciation periods and rates applied to fixed assets should be reviewed periodically (Article 32 section 3 of the Accounting Act). A business owner settling under the PIT Act should also review the rates applied, because a rate from the List can be reduced from the first month of each subsequent tax year (Article 22i section 5) if the original assumptions turned out to be wrong.

The review should cover:

• An assessment of the actual technical condition of the assets
• A comparison of the expected and actual period of use
• An analysis of changes in how the assets are used
• A check of compliance with current legislation

Regular review makes it possible to:

• Adjust depreciation rates to the actual pace of wear
• Avoid errors in tax settlements
• Optimise tax-deductible costs
• Ensure compliance with the law

Frequently asked questions