Today's businesses pay more and more attention to their image, which covers not only the quality of their products or services but also the look of their surroundings. Well-kept green areas around a company's premises can significantly shape how customers and business partners see the company. That is why many businesses decide to buy lawn mowers to look after the grounds around their office or production buildings.
Whether a lawn mower can be treated as a tax-deductible cost matters especially for your company's tax settlements. Accounting for this kind of expense correctly can reduce your tax base and, as a result, your company's tax burden. At the same time, remember to meet all the formal requirements for documenting and recording such purchases. Our accounting firm in Warsaw keeps records of purchases and write-offs like these for its clients.
Legal basis for tax-deductible costs
Under Article 22 of the PIT Act (personal income tax), tax-deductible costs are expenses incurred to earn revenue or to maintain or secure a source of revenue, except for the costs listed in Article 23 of that Act. Although this definition may seem clear at first glance, in practice it leaves considerable room for interpretation.
The tax act does not contain a closed list of expenses that can be treated as tax-deductible costs. This means that every case needs to be analysed individually against the conditions set out in the law. The key is to show the link between the expense and your business activity
Because business events are unlimited in variety, the legislator could not foresee every situation in which entrepreneurs incur business-related expenses. That is why the assessment of whether a given expense can be treated as a tax-deductible cost must take into account the specifics of the case and the nature of the business.
It is particularly important to distinguish between expenses directly related to the business and those with only an indirect link. Expenses on keeping the grounds around a company looking good belong to the second category, but this does not automatically exclude them from tax-deductible costs.
An indirect link with the business may be enough for an expense to be treated as a tax-deductible cost, provided you can show that it affects your ability to earn revenue. This applies in particular to expenses that improve the company's image and how it is perceived by the business community
Expenses on landscaping green areas
Investments in landscaping the grounds around a company's premises cover a wide range of activities, from planting lawns and shrubs to buying equipment to maintain them. All these expenses share a common goal – making the company's surroundings more attractive, which can lead to the company being better perceived by customers and business partners.
Planting grass, trees, flowers or shrubs is a long-term investment that will affect the company's appearance for years. However, keeping these plantings looking good requires regular care, which in turn requires suitable equipment and tools.
Expenses on landscaping green areas around a company remain linked to the revenue it earns, even if the link is indirect. Attractive surroundings can influence potential customers' decisions to start working with the company, which may translate into the ability to earn revenue
It is worth stressing that you cannot clearly determine how much revenue was earned thanks to the attractive appearance of the company's surroundings. However, the fact that this effect cannot be measured precisely does not mean that these expenses fail to meet the conditions for being treated as tax-deductible costs.
This is especially relevant for companies that often host business guests, hold meetings with customers on their premises or operate in industries where image is crucial. In such situations, well-kept surroundings can have a direct impact on the contracts signed and the revenue earned.
Practical example: A consulting firm regularly holds meetings with customers at its premises. Well-kept lawns and attractive surroundings give customers a positive first impression of the firm, which may influence their decision to continue working with it. In this case, the expenses on maintaining the green areas are (indirectly) linked to earning revenue.
A lawn mower as a tool for maintaining the company's image
A lawn mower is an essential tool for keeping the lawns and green areas around a company looking good. Without regular mowing, grass quickly loses its neat appearance, which can harm how the company is perceived by the business community.
The cost of buying a lawn mower can be treated as a tax-deductible cost if the business owner shows its link with the business, for example keeping the grounds around the company's premises or a rented pavilion looking neat (Article 22(1) of the PIT Act).
A lawn mower bought to keep the grounds around a company's premises looking neat can be treated as a tax-deductible cost. The key is to show the link between maintaining an attractive appearance and the business activity
When assessing this link, you can point out that maintaining a good company image by looking after its surroundings can influence the decisions of potential customers and business partners. Well-kept grounds around a company show professionalism and attention to detail, which may matter when deciding whether to start a business relationship.
Remember, however, that the assessment always depends on the circumstances of the specific case, and there are no binding precedents in Polish law. Only your own individual tax ruling gives certainty in your situation, and it protects only the applicant (Article 14k § 1 of the Tax Ordinance Act (Ordynacja podatkowa)).
Depreciation of a lawn mower in a business
How you account for a lawn mower in your business depends mainly on its initial value and the planned period of use. Tax law provides different options depending on which conditions are met.
If the initial value of the lawn mower does not exceed PLN 10,000, you can choose between three options:
- One-off depreciation of the full value of the lawn mower in the month it is put into use or in the following month (Article 22f(3) of the PIT Act)
- Recognising the expense directly in costs in the month the lawn mower is put into use, without depreciation write-offs (Article 22d(1) of the PIT Act)
- Standard depreciation write-offs in line with the regulations
A lawn mower worth up to PLN 10,000 can be accounted for in one go or through regular depreciation write-offs. When choosing the method, consider the specifics of your business and your tax plans for the tax year
For lawn mowers worth more than PLN 10,000, regular depreciation write-offs are as a rule required. The lawn mower must be entered in the fixed asset register and depreciated at the applicable rates. The exceptions are one-off depreciation available to small taxpayers and to businesses in the year they start operating (Article 22k(7) of the PIT Act, de minimis aid) and for brand-new fixed assets in KŚT groups 3–6 and 8 up to PLN 100,000 a year (Article 22k(14)).
Lawn mowers have a 14% depreciation rate, which comes from the List of annual depreciation rates (Annex 1 to the PIT Act) for KŚT type 59. This means that the theoretical depreciation period is about 7 years. Seasonal use does not change the rate; it only affects how the write-offs are spread: for fixed assets used seasonally, write-offs are made in the period when they are used (Article 22h(1)(3)).
Seasonal use of a lawn mower
A lawn mower is used seasonally, mainly from spring to autumn, when grass grows actively and needs regular mowing. This pattern of use has important consequences for how depreciation write-offs are calculated.
Depreciation write-offs on a lawn mower used seasonally are made in the period when it is used for business purposes (Article 22h(1)(3) of the PIT Act). This means that in the winter months, when the lawn mower is not used, no depreciation write-offs are made.
You can choose between two methods of setting the monthly write-off:
- Dividing the annual depreciation amount by the number of months in the season when the lawn mower is used
- Dividing the annual depreciation amount by the 12 months of the year
The first method lets you depreciate the equipment faster, which can be beneficial from a tax planning perspective. The second method extends the depreciation period but spreads the costs more evenly over time
Whichever method you choose, depreciation write-offs are recognised as tax-deductible costs only in the months of the season when the lawn mower is used. This means that with the second method too, no write-offs are made for the winter months. Both calculation methods are compared in a complete guide to fixed asset depreciation.
Practical example of accounting for a lawn mower
To better illustrate how lawn mower depreciation works, let's look at a specific example. Suppose a company bought a lawn mower in June for PLN 12,000 and entered it in the fixed asset register in the same month. Write-offs start in the month following its entry in the register (Article 22h(1)(1) of the PIT Act). The equipment will be used from July to October, which gives 4 months of use in the year.
| Calculation method | Annual depreciation amount | Monthly write-off | Total write-off for 4 months |
|---|---|---|---|
| Method 1 (divided by the season) | PLN 1,680 | PLN 420 | PLN 1,680 |
| Method 2 (divided by 12 months) | PLN 1,680 | PLN 140 | PLN 560 |
Using the first calculation method:
- Annual depreciation amount: PLN 12,000 × 14% = PLN 1,680
- Monthly write-off: PLN 1,680 ÷ 4 months = PLN 420
- Total write-off for 4 months: 4 × PLN 420 = PLN 1,680
Using the second calculation method:
- Annual depreciation amount: PLN 12,000 × 14% = PLN 1,680
- Monthly write-off: PLN 1,680 ÷ 12 months = PLN 140
- Write-off for 4 months of use: 4 × PLN 140 = PLN 560
The choice of method for calculating depreciation write-offs has a significant impact on the amount of tax-deductible costs in a given year. The first method lets you write off the value of the equipment faster, which can be beneficial in years with high revenue
Note that in this example, with the first method you can recognise the entire annual depreciation amount as a cost already in the first year of use, because the write-offs cover the whole season (the lawn mower was entered in the register before the season began). With the second method, the write-offs are spread over a longer period, but the amounts in individual years are lower.
Business scenario: A construction company with high revenue in a given year may choose the first depreciation method to make the most of the possibility of recognising costs. A company with low revenue, on the other hand, may prefer the second method to spread the tax benefits over a longer period.
Classifying a lawn mower under the KŚT
Correct classification of a lawn mower under the Classification of Fixed Assets (KŚT) matters for record-keeping and statistical purposes. A lawn mower should be classified in KŚT type 592 (group 5), which covers care machines and tools (Regulation of the Council of Ministers of 3 October 2016, Dz.U. 2016, item 1864).
This classification follows from the link with PKWiU (Polish Classification of Products and Services) code 28.30.40.0, which covers equipment for maintaining lawns, sports grounds and parks. The PKWiU code is directly linked to the corresponding KŚT group, which keeps the classification consistent across different levels of record-keeping.
Correct classification of a lawn mower in KŚT type 592 matters not only for record-keeping but may also be relevant during tax inspections. Correct classification confirms that the equipment is actually used for the purposes covered by this group
KŚT type 592 covers care machines and tools, so it may include various equipment used to maintain green areas. For a specific piece of equipment (e.g. a strimmer or an aerator), it is worth checking its PKWiU code. Getting the classification right can matter for VAT too — one example is the VAT rate on agricultural land sales.
This classification also matters when determining depreciation rates, because the rate is read from the List of annual depreciation rates according to the KŚT type. The 14% rate applies to the whole of KŚT type 59 (agricultural and forestry machinery, equipment and tools) and does not depend on seasonal use.
VAT on the purchase of a lawn mower and fuel
Buying a lawn mower used in your business entitles you to deduct VAT under the general rules of the VAT Act. If the lawn mower is used exclusively for taxable activities, an active VAT payer can deduct 100% of the VAT on the purchase invoice.
VAT on fuel for the lawn mower is particularly important. Under Article 86(1) of the VAT Act, you can deduct VAT to the extent that the goods or services are used for taxable activities. This means that if the lawn mower is used exclusively for business purposes, you can deduct 100% of the VAT on fuel invoices.
You can deduct the full VAT on fuel for the lawn mower provided the equipment is used exclusively for business purposes. You need to keep appropriate documentation confirming the link with the company's business
Remember that the right to deduct VAT is closely tied to the use of goods or services for taxable activities. If the lawn mower were also used for private purposes, the VAT deduction would have to be limited in proportion to the extent of business use.
Fuel purchase documentation should be kept carefully, as it may be checked during a tax inspection. Fuel invoices should be issued to the company and contain all the required elements of a VAT invoice.
Documenting the use of a lawn mower
Properly documenting the use of a lawn mower in your business is key to keeping the right to recognise related expenses as tax-deductible costs. This documentation may prove essential during a tax inspection.
The basic document is the purchase invoice for the lawn mower, which should contain all the required elements of a VAT invoice. It is also worth keeping a log of the equipment's use, recording the dates and circumstances in which the lawn mower was used.
The log should include information on:
- Dates the lawn mower was used
- Areas where it was used
- Operating time of the equipment
- Fuel consumption
- People operating the lawn mower
Keeping a detailed log of the lawn mower's use can help not only with tax settlements but also with planning maintenance and servicing. Regularly recording operating hours lets you plan technical inspections optimally
The documentation should also include invoices for fuel, oils, spare parts and servicing. All these expenses can be recognised as tax-deductible costs, provided they relate to the use of the lawn mower in the business.
Running and maintenance costs of a lawn mower
Apart from the purchase itself, entrepreneurs also incur costs of running and maintaining a lawn mower. All these expenses can be recognised as tax-deductible costs, provided they relate to the use of the equipment in the business.
Running costs mainly include:
- Fuel for the lawn mower
- Oils and lubricants
- Spare parts and consumables
- Servicing and repairs
- Technical inspections and maintenance
Running costs of a lawn mower can be recognised as tax-deductible costs on an ongoing basis, when they are incurred. They do not need to be depreciated, as they are operating rather than capital costs
Pay particular attention to fuel costs, which often make up a significant part of running costs. As mentioned above, if the lawn mower is used exclusively for business purposes, you can deduct 100% of the VAT on fuel invoices.
Servicing and repair costs should be documented with VAT invoices issued to the company. It is worth keeping a record of all repairs and inspections, which can help when planning the budget for the following years and if you ever sell the equipment.
Comparison of methods for accounting for a lawn mower
| Criterion | One-off depreciation | Regular depreciation | Operating cost |
|---|---|---|---|
| Value of the lawn mower | Up to PLN 10,000 (above that only under Article 22k(7) or (14)) | Over PLN 10,000 (also allowed below) | Up to PLN 10,000 |
| Settlement period | One-off | About 7 years (14% per year) | One-off |
| Tax impact | Large in the first year | Spread over time | Large in the first year |
| Documentation | Purchase invoice and fixed asset register | Fixed asset register | Purchase invoice |
| Flexibility | High | Low | High |
