More and more Poles decide to retreat savings from banks and store them in home safes. This phenomenon is increasing, and experts estimation that there may already be respective twelve billion PLN outside the banking system. The origin is not just increasing inflation or fear of the economical crisis. Equally crucial is the desire to defend privacy and the fear of excessive State interference in citizens' finances. Poles fear the failure of banking systems, cyber attacks and possible savings taxes.
Communications from another countries, specified as Germany and Sweden, are inspired, where the authorities propose keeping a certain amount of cash for a “black hour”. The increase in the sale of armored safes and cash registers is the best proof of that. However, keeping money at home, although full legal, poses a serious risk. The taxation office may be curious in our assets, and in utmost cases impose a severe penalty. The key question is how to do it legally and safely.
How much cash can you legally keep at home?
According to Polish law, there are no limits on the amount of cash a private individual can keep at home. You can legally have in the safe both respective 1000 and respective million zlotys. The specified possession of money is not a crime and it does not request to be reported to the taxation office or any another institution. It is simply a fundamental rule that gives you a sense of freedom and control over your own resources.
However, the situation is very different for entrepreneurs. The rules here are much more restrictive. All transactions between companies whose value exceeds PLN 15,000 must be carried out through a bank transfer. Breaking this regulation has serious taxation consequences – the entrepreneur loses the right to charge specified expenditure to the cost of obtaining income. It's a mechanics to seal the strategy and fight the grey zone.
Although, as a natural person, you don't gotta worry about limits, having a large amount of cash can rise interest in the tax. Officials can't enter your home and search the safe without any circumstantial basis, but if taxation control is initiated for another reason, you will gotta prove the legal origin of the money collected.
When can the IRS knock on the door?
The taxation office begins to operate erstwhile suspicions arise concerning the so-called. Undisclosed revenue. The most common alarm signal for officials is simply a situation where the taxpayer's lifestyle differs importantly from his officially declared income. If a individual earning a minimum wage abruptly buys a luxury car with cash or invests in real estate, the taxation office has all right to check it out.
Initiation of controls means that officials will carefully analyse all the assets: receipts on bank accounts, expenditure history, contracts concluded, and even online activity. Where gross non-compliance is detected, the burden of proof falls on the taxpayer. You're the 1 who has to paper that the cash you own comes from legal and taxed sources. If you can't do it, the consequences are very serious. The taxation may impose a sanctioned taxation rate of 75% of the undisclosed amount.
It is worth remembering that control can start not only due to your expenses. The National taxation Administration (KAS) receives information from many sources – banks, offices and even on the basis of reports from 3rd parties. In the digital age, the flow of information is rapid, and anonymity becomes an illusion.
How to avoid punishment? Documentation is crucial
The most effective defence against allegations from the taxation is careful documentation of the origin of any larger sum of money. Before you decide to store cash at home, make certain you have solid evidence of its legal source. It's the only way you can defend yourself from possible problems.
What papers are worth storing? The list is long and depends on the situation:
- Bank account statements certifying the payment of funds.
- Sales contracts property, e.g. car, flat or plot.
- Notarial acts concerning inheritance or donation.
- Official winning certificates The lottery, the casino or the bookie.
- Applications to the taxation office – especially crucial in the case of donations and inheritances, even those from the closest household that are exempt from tax. The absence of a formal notification may make it impossible to prove the legality of the measures later.
Having a evidence like this is your insurance policy. In the event of a check, you will be able to easy show where the money comes from by closing the case before it starts for good.
Safe is not a bank. How to safely store money?
The decision to keep cash at home is not only a taxation issue, but besides a safety issue. The home safe, unlike the bank account, is not protected by the Bank warrant Fund (BFG). In case of theft, fire or flooding, it may not be possible to recover the money. It is so essential to take appropriate steps to minimise risks.
Experts urge primarily investment in high quality, certified safewhich should be firmly anchored in the building's structural elements. That'll make it much harder for burglars to carry him out. An alarm strategy and video surveillance are equally important. It is besides worth reasoning about insurance of the home or apartment, but you should check the policy conditions carefully. Most insurers usage low limits of liability for stored cash, frequently only a fewer 1000 zlotys.
In addition to the physical safety of money, take care of the safety of papers confirming their origin. store their copies elsewhere – for example in the cloud, a bank box or a trusted notary. In the event of a dispute with the taxation office or insurance company, any evidence will be of gold weight.
Continued here:
Poles keep billions in cash. The taxation may impose 75% of the criminal tax
