Switching to full accounting in 2026 is a key moment in the development of any business, especially for companies whose turnover is growing fast and whose revenue keeps rising. Moving from simplified tax records to comprehensive accounting is not just a legal requirement, but also a strategic step that enables better financial management and more precise reporting on the business.
As a business grows, the requirements for recording business events naturally increase. Full accounting not only ensures compliance with the applicable rules, but also gives managers detailed information needed to make strategic business decisions. Given growing regulatory requirements and the need for financial transparency, introducing accounting books becomes a natural stage in the development of every growing business.
Record-keeping obligations in business
Running a business in Poland requires systematic recording of all economic events related to its operation. Tax and accounting rules impose different obligations on businesses, depending on many factors, such as the legal form of the business, its size, its ownership structure and the specifics of the industry in which it operates.
The variety of forms of taxation and methods of recording business events results from the need to adapt the accounting system to the specific needs of different types of businesses. Smaller businesses can use simplified forms of record-keeping, while larger organisations need more advanced accounting systems that allow detailed tracking and analysis of transactions.
The choice of legal form, as well as the size and scope of the business, are closely linked to the obligation to use a specific method of taxation and a specific form of accounting records. These decisions have long-term consequences for the business and require careful consideration of all legal and economic aspects
Business owners who have chosen the tax scale (12% and 32%) or the flat 19% tax (podatek liniowy) record their business events in the KPiR (tax revenue and expense ledger) – until their revenue reaches the limit that triggers the obligation to keep accounting books. This form of record-keeping is intended for PIT (personal income tax) taxpayers and is a simplified accounting method suitable for smaller businesses with a relatively simple operating structure. We keep the KPiR – and, once the limit is exceeded, the accounting books – at our accounting firm in Warsaw.
All entities subject to CIT (corporate income tax) are required to keep accounting books, i.e. so-called full accounting. This requirement stems from the need for greater transparency and accuracy in recording business events for entities with a more complex legal and economic structure.
Entities required to keep accounting books
The obligation to keep accounting books is governed by the Accounting Act, which applies to a wide range of entities with their registered office or place of management in Poland. Its scope covers various organisational forms, from commercial companies to local government units. Every entity that starts keeping accounting books must also adopt an accounting policy.
Commercial companies, both partnerships and capital companies, including companies in organisation and civil-law partnerships (spółka cywilna), are required to keep accounting books under the Accounting Act (Article 2 section 1 point 1) – except for general partnerships of natural persons, professional partnerships and civil-law partnerships of natural persons, for which the revenue limit described below is decisive. The requirement also applies to other legal persons, except the State Treasury and the National Bank of Poland, which are subject to separate regulations.
Natural persons, civil-law partnerships of natural persons, general partnerships of natural persons and professional partnerships are required to keep accounting books if their net revenue from the sale of goods and products for the previous financial year was at least the equivalent in Polish currency of EUR 2,500,000 (threshold in force since 1 January 2025; previously EUR 2,000,000). This revenue threshold is the key factor determining the obligation to switch to full accounting
Special rules apply to an enterprise in probate (przedsiębiorstwo w spadku) operating under the Act on succession management of a natural person's enterprise. If accounting books were kept on the day before the opening of the succession, the enterprise must continue to keep them regardless of its revenue.
- Analyse the legal form of your business
- Check your net revenue for the previous financial year
- Determine whether your business is subject to special industry rules
- Verify whether the criteria requiring accounting books are met
- Prepare the documentation needed to start keeping accounting books
Organisational units operating under banking law, securities trading rules, rules on crowdfunding services for business, rules on investment funds and alternative investment fund management, rules on insurance and reinsurance, rules on cooperative savings and credit unions, or rules on the organisation and operation of pension funds are required to keep accounting books regardless of their revenue.
| Type of entity | Criterion for the obligation | Legal basis | Additional requirements |
|---|---|---|---|
| Commercial companies | Legal form | Article 2 section 1 point 1 | Except general partnerships of natural persons and professional partnerships |
| Natural persons | Revenue EUR 2.5 million | Article 2 section 1 point 2 | For the previous year |
| Financial entities | Type of activity | Article 2 section 1 point 3 | Regardless of revenue |
| Local government units | Legal status | Article 2 section 1 point 4 | Municipalities, districts, provinces |
Revenue limit for switching to full accounting
Revenue is the key factor determining whether natural persons, civil-law partnerships of natural persons, general partnerships of natural persons and professional partnerships must keep accounting books. Under the PIT Act (Article 24a section 4), these entities must keep accounting books if their revenue within the meaning of Article 14 of that Act for the previous tax year was at least the equivalent in Polish currency of the amount set in the accounting rules.
Since 1 January 2025, the threshold set in the Accounting Act has been EUR 2,500,000 (previously EUR 2,000,000). This amount is converted into Polish zloty at the average exchange rate published by the National Bank of Poland (NBP) for the first working day of October of the year preceding the financial year (Article 3 section 3 of the Accounting Act, Article 24a section 6 of the PIT Act). This mechanism keeps the revenue threshold up to date with exchange rate fluctuations.
The revenue limit requiring accounting books in 2026 is PLN 10,646,500. This amount was calculated using the NBP average exchange rate of 1 October 2025, which was PLN 4.2586 per euro. Reaching this threshold with revenue for 2025 means you must switch to full accounting from 1 January 2026. From 1 January 2027 (revenue for 2026), the limit is PLN 10,942,500 – based on the exchange rate of 1 October 2026 (PLN 4.3770 per euro)
The revenue limit for 2026 is calculated as follows: EUR 2,500,000 × PLN 4.2586/EUR = PLN 10,646,500. The average rate was published by the NBP in average exchange rate table No. 190/A/NBP/2025 of 1 October 2025 and is the basis for converting the threshold into Polish zloty.
The annual conversion of the revenue limit keeps it in line with current economic conditions and exchange rate fluctuations. Business owners must monitor their revenue against the applicable threshold on an ongoing basis so that they can prepare properly for a possible switch to full accounting in the following financial year.
How to calculate total revenue for the previous year
Correctly calculating total revenue for the previous year is a key element in checking whether you must switch to full accounting. Business owners must include all revenue as defined in the PIT Act, which covers not only taxable revenue but also tax-exempt revenue.
Under the PIT Act, business revenue means amounts due, even if they have not actually been received, less the value of returned goods, discounts and cash discounts granted. For taxpayers selling goods and services subject to VAT, revenue from such sales is the amount less the VAT due.
When calculating total revenue to check the obligation to keep accounting books, you must include all tax revenue, including tax-exempt revenue. This applies, among others, to grants, subsidies and other forms of financial support that are exempt from tax under the tax rules but are revenue within the meaning of the income tax act
Taxpayers who keep the KPiR start by checking the revenue recorded in the "Total revenue" column – in a ledger kept until the end of 2025 this is column 9 (the sum of column 7 "Value of goods and services sold" and column 8 "Other revenue"), and in a ledger following the template in force from 1 January 2026 – column 11 (the sum of columns 9 and 10). This column contains the basic tax revenue recorded in the course of the business.
To the revenue from the "Total revenue" column of the KPiR, you must also add tax-exempt revenue that is not recorded in the standard KPiR records. Examples of such revenue include grants specified in the PIT Act, the value of free-of-charge benefits and tax revenue for which tax collection has been waived.
- Revenue from the "Total revenue" column of the KPiR (column 9 until 2025, column 11 from 2026)
- Grants exempt from tax under the tax rules
- The value of free-of-charge benefits specified in the income tax act
- Tax revenue covered by a waiver of tax collection
- Subsidies received to carry out business tasks
- Other tax-exempt revenue that still counts as tax revenue
Practical aspects of checking the revenue limit
Checking whether the revenue limit has been exceeded requires a systematic approach and taking into account all categories of revenue that, under the tax rules, should be included in the threshold calculation. Business owners must remember that the definition of revenue used to determine the obligation to keep accounting books is broader than the definition of taxable revenue.
In an individual tax ruling (KIS) of 28 April 2022 (0113-KDIPT2-1.4011.56.2022.2.KO), the Director of National Tax Information explained that the provision of the PIT Act merely defines business revenue and does not distinguish between taxable and tax-exempt revenue for the purpose of the revenue level that triggers the obligation to keep accounting books. Keep in mind that the Accounting Act itself (Article 2 section 1 point 2) refers to net revenue from the sale of goods and products, while the PIT Act (Article 24a section 4) refers to revenue within the meaning of Article 14; the tax authorities apply the measure from the PIT Act.
Grants and subsidies received, except those intended for the purchase or in-house production of fixed assets or intangible assets that are depreciated, are business revenue. This revenue must be taken into account when determining the revenue limit that triggers the obligation to keep accounting books, regardless of its tax exemption
If the total revenue calculated by the business owner for the purpose of the revenue level triggering the obligation to keep accounting books in 2025 is equal to or higher than the limit of PLN 10,646,500, the taxpayer must close the KPiR for 2025 and open accounting books from 1 January 2026.
A business owner running a JDG (sole proprietorship) earned revenue of PLN 10,580,000 in 2025, recorded in column 9 of the KPiR. In addition, he received a one-off grant of PLN 100,000 to start a business, exempt from tax. Total revenue was PLN 10,680,000, which exceeded the limit of PLN 10,646,500, requiring him to switch to full accounting in 2026.
Example: EU subsidies in a training business
Consider a business owner running a sole proprietorship providing educational services. Mr Jan keeps a tax revenue and expense ledger and pays the flat 19% tax (podatek liniowy). In his business, he runs both commercial training paid for by clients and training as part of EU projects financed from public funds.
In connection with the EU projects, Mr Jan receives subsidies for direct costs, which are not recorded in the KPiR because they cover expenses that are not tax-deductible costs in his business. Nevertheless, the subsidies received are revenue within the meaning of Article 14 of the PIT Act (section 2 point 2) and must be taken into account when calculating the revenue limit.
This means that to determine the revenue limit triggering the obligation to keep accounting books, Mr Jan must include not only revenue from his commercial activity but also the subsidies received to finance direct costs related to carrying out EU project tasks.
A business owner running a training business earned commercial revenue of PLN 8,700,000 in 2025 and received EU subsidies for educational projects of PLN 2,000,000. Total revenue amounted to PLN 10,700,000, which exceeded the PLN 10,646,500 limit applicable for 2026. As a result, the business owner must keep accounting books from 1 January 2026.
Keeping accounting books voluntarily
The Accounting Act allows accounting books to be kept voluntarily by entities that are not required to do so because of the revenue limit or the nature of their business. Natural persons, civil-law partnerships of natural persons, general partnerships of natural persons, professional partnerships and enterprises in probate may choose to keep accounting books regardless of their revenue.
The decision to keep accounting books voluntarily must be made in advance and cannot be implemented during the financial year. Voluntary accounting books are kept from the beginning of the next financial year. The Accounting Act (Article 2 section 2) requires notifying the head of the tax office (urząd skarbowy) competent for income tax before the start of the financial year, unless separate provisions state otherwise – and the PIT Act (Article 24a section 5) provides that the taxpayer reports keeping accounting books in the annual tax return filed for the year in which they were kept.
For PIT taxpayers, this means that the decision to keep accounting books voluntarily does not require prior notification of the tax authorities — the general obligation to notify the tax office (urząd skarbowy) under Article 2(2) of the Accounting Act applies "unless separate provisions provide otherwise", and the PIT Act does provide otherwise.
The decision to keep accounting books voluntarily must be made before the start of the financial year, and a PIT taxpayer reports it in the annual tax return for that year (Article 24a section 5 of the PIT Act). A business owner cannot choose this option during the financial year, which means planning the decision well in advance and taking into account all of its legal and economic consequences
Keeping accounting books voluntarily can be beneficial for business owners who plan to grow and expect to exceed the revenue limit in the coming years. Introducing full accounting earlier helps the organisation prepare for the stricter record-keeping requirements and gradually adapt its internal processes to a more advanced accounting system.
The choice to keep accounting books voluntarily may be driven by various business reasons, such as planned external financing, preparing the business for sale, or the wish to get more precise information on the profitability of individual areas of the business.
Consequences of switching to full accounting
Switching from simplified tax records to full accounting involves a number of significant changes to how the business operates, affecting not only the technical side of record-keeping, but also the organisational and strategic aspects of managing the company. Business owners must prepare for stricter requirements for documenting business transactions and more detailed financial reporting.
Introducing accounting books requires double-entry bookkeeping, which means recording every business transaction in at least two accounts. This system provides greater control over business transactions and makes it possible to prepare more detailed financial statements, but it also requires greater accounting expertise and more advanced IT tools.
Full accounting requires annual financial statements consisting of a balance sheet, a profit and loss account and notes. These statements must be prepared in line with the Accounting Act and submitted to the competent authorities on time, which increases the business's reporting obligations
Businesses that keep accounting books must carry out stocktaking of their assets, which consists of checking the actual condition of the assets and comparing it with the position shown in the accounting books. As a rule, stocktaking is carried out as at the last day of each financial year (Article 26 section 1 of the Accounting Act), and for some assets the law allows a less frequent cycle – once every 2 or 4 years (Article 26 section 3).
- Closing the KPiR for the previous year
- Preparing an opening balance sheet as at the day accounting books start to be kept
- Implementing double-entry bookkeeping
- Drawing up a company chart of accounts tailored to the business
- Carrying out a stocktaking of assets as at the day the books are opened
- Implementing internal control procedures and an accounting document workflow
Procedure: moving from the KPiR to full accounting step by step
Whether the switch to accounting books is voluntary or mandatory after exceeding the revenue limit, the taxpayer should carry out a number of preparatory steps. The first step is to close and settle the tax ledger for the previous year (including the physical stocktake (spis z natury) as at 31 December — § 20 of the KPiR regulation, Journal of Laws (Dz.U.) 2025, item 1299), determining annual income under Article 24(2) of the PIT Act.
When moving from the tax ledger to full accounting, you must prepare a list of assets and liabilities confirmed by stocktaking. Under Article 19(1) of the Accounting Act, this list (inventory) is prepared by entities that have not previously kept accounting books in the manner set out in the Act; its items correspond to the items of the opening balance sheet (Article 19(2)).
Preparing a list of assets and liabilities confirmed by stocktaking is mandatory when moving to full accounting. The stocktaking must cover all assets and liabilities as at the day on which accounting books start to be kept
The next stage is to open the accounting books at the beginning of the financial year, which must be done within 15 days of the start of the financial year (Article 12(1) of the Accounting Act). Before you start keeping accounting books, you also need to set out your accounting policy in writing (Article 10(1)–(2)), which will be the basis for all accounting transactions.
The switch also requires preparing appropriate accounting systems and procedures, which are much more extensive than those used with the tax revenue and expense ledger. You need to allow for keeping additional registers and documentation and meeting reporting requirements.
When to start preparing
Proper preparation for moving to full accounting is key to ensuring continuity of records and avoiding legal problems. The process should start early enough, ideally in the last quarter of the year preceding the planned switch.
The first step is to analyse the current state of the accounting records and identify all assets and liabilities that will have to be included in the opening inventory. You should also prepare the appropriate accounting procedures and choose the chart of accounts that will be used in the new system.
Deadlines for switching to full accounting
Complying with the deadlines and legal procedures related to moving to full accounting is mandatory and has significant consequences for the business owner. Failing to meet these requirements may lead to legal and financial sanctions.
Key deadlines related to moving to accounting books:
- 1 January - the date on which you start keeping accounting books
- 15 January - the deadline for opening the accounting books (15 days from the start of the year)
- 31 December - physical stocktake and closing of the KPiR for the previous year
- By 30 April - the deadline for filing the tax return (PIT-36 or PIT-36L) for the previous year (Article 45(1) and (1a) of the PIT Act)
- By 31 March of the year following the first year of accounting books - preparation of the financial statements for the first year (3 months from the balance sheet date, Article 52(1) of the Accounting Act); the financial statements are sent to the Head of KAS (National Revenue Administration) before the deadline for filing the tax return (Article 45(5) of the PIT Act)
The accounting books must be opened within 15 days of the start of the financial year, i.e. by 15 January. Failing to keep accounting books or keeping them contrary to the rules is punishable by a fine or imprisonment of up to 2 years (Article 77(1) of the Accounting Act), and unreliable or defective books may lead to liability under the Fiscal Penal Code
Elements of accounting books
Under the Accounting Act, accounting books consist of sets of accounting entries, turnovers and balances that form a comprehensive system of financial records for the business. This system is much more extensive than simplified accounting based on the KPiR.
| Accounting element | Function | Frequency | Special requirements |
|---|---|---|---|
| Journal | Chronological entries of transactions | Ongoing | Continuous numbering |
| General ledger | Records in synthetic accounts | Ongoing | Chart of accounts |
| Subsidiary ledgers | Detailed records | Ongoing | Reconciliations |
| Trial balances | Checking correctness | Periodically | Balancing |
| Inventory | List of assets | When the books are opened | Stocktaking |
The journal is the basic element of accounting books, in which all business transactions are recorded in chronological order. Each journal entry must include the date of the transaction, a description and the accounts concerned. The general ledger contains records of all transactions in synthetic accounts according to the adopted chart of accounts.
Subsidiary ledgers are used for detailed records of business transactions and must be reconciled regularly with the general ledger. Trial balances are prepared to check the correctness of the accounting entries and as a basis for preparing financial statements
The list of assets and liabilities, also called the inventory, is prepared on the basis of stocktaking and is the basis for opening the accounting books and checking the entity's assets. In later years, the role of the inventory is played by the trial balances prepared as at the day the books are closed (Article 19(1) of the Accounting Act). All these elements must be kept in line with the adopted accounting principles and the law in force.
Differences between the KPiR and accounting books
Moving from the tax revenue and expense ledger to full accounting means significant changes in how business transactions are recorded. The differences concern not only the scope of records but also the accounting method and reporting requirements.
With the KPiR, records are mainly limited to recording revenue and costs on a cash or accrual basis, depending on the chosen method. Accounting books, by contrast, require comprehensive records of all assets, liabilities and equity using double-entry bookkeeping.
Another important difference is the scope of reporting. The KPiR is mainly used to determine the income tax base, whereas accounting books are the basis for preparing full financial statements, including a balance sheet, a profit and loss account and additional information.
A business owner who previously kept a KPiR recorded only revenue and costs in a simple table. After moving to accounting books, they must keep records in accounts, prepare a trial balance and prepare monthly trial balances. In addition, they must carry out stocktaking of assets and prepare annual financial statements consisting of a balance sheet, a profit and loss account and additional information.
Technical and organisational requirements of full accounting
Keeping accounting books requires meeting a number of technical and organisational requirements that ensure the accuracy, completeness and reliability of the accounting records. Businesses should implement appropriate internal control procedures, ensure a proper accounting document workflow and protect the financial data they store.
Accounting books can be kept on paper or electronically, and more and more businesses are choosing modern IT systems that automate many accounting processes. Whatever the form, businesses must ensure the books' integrity and completeness and that they can be restored in the event of damage or loss.
Accounting documents and accounting books must be kept for at least 5 years, counting from the beginning of the year following the financial year to which they relate (Article 74 sections 2 and 3 of the Accounting Act), and for tax purposes – until the tax liability becomes time-barred, as a rule 5 years from the end of the year in which the tax payment deadline passed (Article 86 § 1 and Article 70 § 1 of the Tax Ordinance Act (Ordynacja podatkowa)). This period may be extended if inspection or court proceedings are pending. Businesses must ensure suitable storage conditions for documents and protect them against damage, loss or unauthorised access
The internal control system in a business that keeps accounting books must include procedures for authorising business transactions, checking that accounting documents are correct, checking that accounting entries match source documents and periodically verifying account balances. An effective internal control system minimises the risk of accounting errors and helps ensure the reliability of the financial statements.
