Tax liabilities and arrears are among the most common problems faced by entrepreneurs and individuals. As Benjamin Franklin aptly observed, the only certainties in the world are death and taxes – and data from the Ministry of Finance shows that their burden can be severe. In 2023 alone, tax arrears in Poland exceeded PLN 115 billion, of which PLN 81% related to VAT. At the end of the first half of 2025, the total amount of tax arrears was approximately PLN 121.4 billion., and over 76 % of this sum concerned VAT.
In the article we explain:
- what real and legal solutions can limit its effects or lead to its cancellation.
- what is tax liability,
- when arrears arise, how to check them
Contents:
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What is a tax liability?
A tax liability is a formal obligation to pay a tax to the state or local government units. Its definition is included in the Tax Ordinance, according to which a tax liability results directly from a tax obligation and means the necessity payment of tax in a certain amountand, date and place.
What does tax liability cover?
Tax liability may include, among others:
- personal income tax (PIT),
- corporate income tax (CIT),
- goods and services tax (VAT),
- excise tax,
- tax on civil law transactions (PCC),
- property tax and other public levies.
Expert commentary
In practice, tax liability creates bilateral legal relationship: the taxpayer has an obligation to pay, and the tax authority has the right to demand payment. The key point is that the mere existence of a liability does not necessarily constitute a financial problem; a problem only arises when it is not paid on time.
When does a tax liability arise?
The moment a tax liability arises is strictly defined by the provisions of the Tax Ordinance. Generally, the liability arises either by operation of law, or based on the decision of the tax authority.
An obligation arising from the operation of law
It applies to situations in which the tax law links the creation of an obligation with a specific event, e.g.:
- conclusion of the contract,
- making a sale,
- expiry of the billing period.
Obligation arising from a decision
In this case, the obligation arises upon delivery of the decision establishing its amount.
Expert commentary
In practice, the most doubts arise from obligations arising from the operation of law, especially in periodic taxes (VAT, PIT, CIT). Taxpayers often do not associate the end of a tax month or year with the creation of a specific, due obligation. liabilities, which contributes to the occurrence of arrears.
When does a liability become a tax arrears?
Tax arrears arise when a tax liability is not settled on time.
What is considered arrears?
The following are considered tax arrears:
- unpaid tax,
- unpaid advance tax,
- unpaid tax installment.
Expert commentary
A backlog is arising automatically, without the need for a decision from the tax office. Late payment interest begins to accrue from the day following the payment due date, which results in rapid growth of debt.
How to check tax arrears?
Information on tax arrears can be obtained directly from the tax office competent for the taxpayer's place of residence or registered office.
Available forms of verification:
- submitting an application for certificate of no arrears,
- submitting an application for certificate of arrears,
- application for the issuance of another certificate with specific content.
Expert commentary
Precisely defining the content of the application is crucial. The Tax Ordinance regulates the types of certificates in detail, and an incorrectly worded application may result in a document that does not meet the taxpayer's or contractor's expectations.
What are the consequences of tax arrears?
Tax arrears have a number of negative consequences.
Nthe most common consequences:
- charging high tax interest,
- no possibility of obtaining a certificate of no arrears,
- loss of contracts and financing,
- quick administrative enforcement,
- actual restriction or prevention of conducting business activity.
Expert commentary
Administrative enforcement is much more severe than civil enforcement because the tax office has broad powers and acts faster than other creditors.
What can be done with the resulting tax arrears?
Tax law provides several tools that allow limit the effects of arrears.
Available solutions:
- deferment of payment deadline,
- payment of arrears in installments,
- cancellation of arrears or interest,
- correction of the tax return in the event of an error.
Expert commentary
The tax authority always examines whether there is important interest of the taxpayer or public interest. The mere fact of a difficult financial situation is not sufficient – appropriate justification and documentation are necessary.
Can a tax liability be written off?
The cancellation of a tax liability is exceptional and is only possible in strictly defined cases.
Grounds for cancellation:
- unprofitability of enforcement,
- low amount of arrears in relation to enforcement costs,
- lack of satisfaction in bankruptcy proceedings,
- dismissal of a bankruptcy petition,
- death of the taxpayer without leaving any assets.
Expert commentary
Additionally, the authority examines whether the write-off constitutes unlawful state aid. In practice, these conditions are interpreted restrictively, which makes the applications less effective. depends on their professional preparation.
Benefits of debt write-off in restructuring proceedings
Restructuring proceedings offer much broader possibilities than standard tax law instruments.
Key benefits:
- a comprehensive arrangement involving multiple creditors,
- possibility of partial write-off of taxes and interest,
- protection of assets against enforcement,
- the private creditor test limiting the risk of public aid,
- the possibility of approving the arrangement despite the opposition of some creditors.
Expert commentary
Once the arrangement is approved by the court, its effects take effect by operation of law, and tax liabilities are subject to change. For many entrepreneurs, this is the only real alternative to bankruptcy.
Frequently asked questions:
Do tax arrears expire?
Yes, as a rule after 5 years, but the period may be interrupted.
Can the tax office write off VAT?
Yes, in certain situations, also in restructuring.
How quickly does the tax office initiate enforcement proceedings?
Much faster than civil creditors – often without notice.
Summary
Tax arrears don't have to mean the end of your business. The key is quick action, proper analysis of the situation and selection of the appropriate legal tool – from tax relief to restructuring proceedings.
If you have a problem with tax arrears – consult the situation with a restructuring advisor.
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