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I'd go for 'flat-rate' despite the limits, but the rate can be 20%, which is not reduced compared to the standard first band rate now.
Peter Nicholson (X)
Poland
Just a suggestion
15:20 Mar 7, 2011
1. If the tax is levied on gross income it ought to be obvious that costs are not deductible. 2. The distinction between ‘flat’ and ‘flat rate’ is a hypothesis, based on the two interesting links given earlier.
1. "How about ‘reduced-rate tax on gross income (for specified occupations)’?" Sama stawka podatku przy ryczałcie jest nominalnie niższa, jednak rzeczywiste obciążenie podatkowe (czyli kwota podatku do zapłacenia) może być nawet wyższe niż w przypadku opodatkowania na zasadach ogólnych - właśnie ze względu na brak możliwości odliczenia kosztów uzyskania przychodu (które przecież mogą być równe lub wyższe od przychodu, czyli podatek wyniósłby 0). Tak więc informacja "without deductible costs" jest tu kluczowa. 2. "A distinction between ‘flat’ and ‘flat rate’" Trudno mi uwierzyć w istnienie takiego rozróżnienia - czy jest w sieci jakieś potwierdzenie?
Peter Nicholson (X)
Poland
A distinction between ‘flat’ and ‘flat rate’
06:29 Mar 4, 2011
A ‘flat tax’ doesn’t have to mean the same as a ‘flat-rate tax’. A flat tax is one in which there is a single rate, levied universally on all payers of the tax. This would be podatek liniowy. A flat-rate tax is one in which the amount of tax paid by each individual payer of the tax does not vary, for example according to the taxpayer’s cost of sales. Here, ‘flat’ means ‘without possibility of change; fixed’, and corresponds to ryczałt in this context.
Peter Nicholson (X)
Poland
Another idea
20:47 Mar 3, 2011
How about ‘reduced-rate tax on gross income (for specified occupations)’? The reduced rates are 8.5% (etc) and 20% instead of 18% and 32%. Any takers?
Podatek liniowy (również: podatek płaski) – jest metodą obliczania wymiaru podatku, w myśl której wysokość należnego podatku jest wprost proporcjonalna do wielkości podstawy opodatkowania. Koncepcja podatku liniowego jest formułowana najczęściej w odniesieniu do podatku dochodowego od osób fizycznych lub podatku dochodowego od osób prawnych. W takim przypadku wymiar podatku liniowego jest obliczany w oparciu o jedną stawkę opodatkowania, co oznacza, że wszyscy podatnicy płacą taką samą część (np. 19%) swoich dochodów w formie podatku. http://pl.wikipedia.org/wiki/Podatek_liniowy A flat tax (short for flat rate tax) is a tax system with a constant tax rate. http://en.wikipedia.org/wiki/Flat_tax
Te "progressive rates" to: 18% (minus kwota zmniejszająca podatek 556 zł 02 gr) do 85 528 zł 14 839 zł 02 gr + 32% nadwyżki ponad 85 528 zł http://tinyurl.com/4vpfvrf
Czyli wyszłoby tak: dwie stawki 8,5% i 20% z progiem na 4000 euro mielibyśmy nazywać podatkiem liniowym (flat tax), a dwie stawki 18% i 32% z progiem na 85 528 zł mielibyśmy nazywać podatkiem progresywnym. Czy ma to jakikolwiek logiczny sens?
"There is absolutely no doubt that the term ‘lump-sum’ is completely unsuitable for this tax." Racja - podałem ten odnośnik tylko ze względu na "revenue" (dodałem w tamtym pytaniu komentarz na temat "lump sum"). Usunąłem już przedmiotowy odnośnik (http://www.proz.com/kudoz/532098 ) z mojego komentarza, bo faktycznie wprowadza w błąd. "There, your answer to the question ryczałt ewidencjonowany was ‘(flat-rate) tax on registered income without deductible costs’." Proszę zauważyć, że usunąłem niepoprawny człon "flat rate" przy wpisywaniu terminu do glosariusza. "I still do not understand why the word ryczałt is used for this tax." Proszę spojrzeć na stwierdzenie w trzeciej odpowiedzi ("Słowo "ryczałt" jest trochę mylące."). Dlaczego jest mylące, uzasadniłem we wcześniejszych postach (w skrócie: ryczałt = podatek zryczałtowany = podatek zglobalizowany = podatek od całości przychodów = podatek bez (możliwości odliczania) kosztów).
Peter Nicholson (X)
Poland
Is it flat or isn’t it?
13:37 Mar 3, 2011
I note, Polangmar, that you have agreed with the answer given to this question by jarekab. In your comment on his answer, you include a link to a previous question on exactly the same term. The successful and only answer given to that question was ‘lump-sum tax on registered revenue/income’. There is absolutely no doubt that the term ‘lump-sum’ is completely unsuitable for this tax. Meanwhile, in his answer, jarekab includes a link directing us to a previous question about practically the same term, in which your answer was selected as most helpful. There, your answer to the question ryczałt ewidencjonowany was ‘(flat-rate) tax on registered income without deductible costs’. And now you are telling us that „nie można podawać w tłumaczeniu informacji nieprawdziwych ("flat tax")”.
Peter Nicholson (X)
Poland
What does ryczałt mean?
13:35 Mar 3, 2011
Thank you for your insightful remarks, Polangmar. As far as I understand your method of back-translating KudoZ answers, you should not allow the sequence ryczałt > ‘tax’ > ryczałt, because this would in turn suggest the translation ‘tax ryczałtowy’ > ryczałtryczałtowy. By the way, however do we say ryczałtowy in English? I remain of the opinion that the name ryczałt od przychodów ewidencjonowanych does not state directly that this form of taxation does not allow the deduction of the cost of sales. It does not follow from the fact that the tax called ryczałt od przychodów ewidencjonowanych is levied, as you say, „bez pomniejszania o koszty uzyskania przychodu” that the word ryczałt means bez pomniejszania o koszty uzyskania przychodu. I still do not understand why the word ryczałt is used for this tax.
1. "The fact that ryczałt is paid at 8.5% up to €4,000 is not stated in the name ryczałt od przychodów ewidencjonowanych, so why should it be in the translation of the name?" Nie musi być - i nie jest - ale nie można podawać w tłumaczeniu informacji nieprawdziwych ("flat tax"). 2. "One may as well object to the other three answerers’ use of the word ‘tax’ as a translation of ryczałt on the grounds that someone might back-translate ‘tax’ as podatek." I będzie to prawidłowe tłumaczenie wsteczne - "ryczałt" to skrót myślowy od "podatek ryczłtowy/zryczałtowany". 3. "Since the name ryczałt od przychodów ewidencjonowanych does not state directly that this form of taxation does not allow the deduction of the cost of sales". Yes, it does state directly that this form of taxation does not allow the deduction of the cost of sales (see links above). 4. "Besides, when their revenue does exceed the threshold, is the tax they then pay still called ryczałt?" Yes, of course: http://tinyurl.com/6jzu9s6
Od zleceń 18-proc. podatek zryczałtowany Od 2009 roku, gdy miesięczny przychód od tego samego płatnika z umów zlecenia i o dzieło nie przekroczy 200 zł, zapłacimy 18-proc. podatek bez uwzględniania kosztów uzyskania przychodu. (...) Podatek zryczałtowany wyniesie 18 proc. przychodu. Opodatkowanie podatkiem zryczałtowanym polega na tym, że stawka podatku jest nakładana bezpośrednio na kwotę przychodu. Ekspert dodaje, że podatnikowi nie przysługują więc koszty uzyskania przychodu. Pobór podatku zryczałtowanego oznacza jednakże, że podatnik nie musi już rozliczać się z tak opodatkowanego przychodu w zeznaniu rocznym. Podatek pobrany przez płatnika jest finalnym podatkiem od tego przychodu. http://podatki.gazetaprawna.pl/artykuly/96330,od_zlecen_18_p... Tak więc słowo "ryczałt" oznacza "bez pomniejszania o koszty uzyskania przychodu" - liniowość tego uregulowania jest tu akcydensem; podobnie akcydensem jest użycie określenia "od przychodów" (nie można powiedzieć "od dochodów").
Peter Nicholson (X)
Poland
(continued)
22:06 Mar 2, 2011
3. The statement ‘a flat tax never carries reliefs or exemptions apart from a standard personal allowance’ is, I believe, a correct one. However, in response to your very pertinent observation, some of what I wrote earlier requires clarification, as follows. Since the name ryczałt od przychodów ewidencjonowanych does not state directly that this form of taxation does not allow the deduction of the cost of sales, it is not necessary, nor even advisable, to use the words ‘without deductible costs’ in our translation. The word przychodów is used in contradistinction to dochodów, and this is precisely to indicate the fact that no reliefs, exemptions or deductions of costs are allowed. 4. Despite the existence of a revenue threshold above which tax is paid at a higher rate, ryczałt is, for practical purposes, flat – this form of taxation is intended for small traders with low turnovers. Besides, when their revenue does exceed the threshold, is the tax they then pay still called ryczałt?
Peter Nicholson (X)
Poland
Polangmar
22:05 Mar 2, 2011
1.The fact that ryczałt is paid at 8.5% up to €4,000 is not stated in the name ryczałt od przychodów ewidencjonowanych, so why should it be in the translation of the name? 2. Yet again, the reasoning involved in your back translation of ‘flat tax’ is unwarranted. One may as well object to the other three answerers’ use of the word ‘tax’ as a translation of ryczałt on the grounds that someone might back-translate ‘tax’ as podatek. I have not proposed using the term ‘flat tax’, but ‘flat tax for specified occupations’.
Krzysztof Kajetanowicz napisał: "W takim razie termin "corporate income tax" jest niejasny? przecież na tej zasadzie to wychodzi "korporacyjny podatek od dochodów". Dokładnie tak wychodzi - i bardzo dobrze wychodzi: http://tinyurl.com/6flnev6 .
Peter Nicholson napisał: "Since a flat tax never carries reliefs or exemptions" W polskim systemie podatkowym podatnicy, którzy wybierają rozliczenie w formie podatku liniowego (czyli "flat tax": http://tinyurl.com/6j65c3y ) mają prawo do odliczania kosztów uzyskania przychodów. Natomiast płatnicy podatku ryczałtowego od przychodów ewidencjonowanych nie mogą odliczać takich kosztów, więc użycie określenia "flat tax" byłoby tu mylące (podwójnie, bo ryczałt nie jest "płaski" - ma dwie stawki).
I know it is not a lump-sum tax. That should be obvious to anyone who knows what 'lump-sum' means. However, I have two published translations of updof here, and both of them, like Gajewski, use the term 'lump'. Is there any sound reason for this?
Krzysztof Kajetanowicz (X)
Poland
not this tax
10:21 Mar 2, 2011
What they refer to as "lump tax" is probably "karta podatkowa", where you pay a specific zloty amount per month, regardless of how much you make. Very few occupations qualify, obviously (priests for example).
Funny thing - one of the chapters is titled "Object of Taxation and Sources of Revenues". Admittedly though, Beck is often criticised for its translations of Polish tax laws to English.
profit & loss; income vs profit; income vs revenue
18:15 Mar 1, 2011
Section C.1 of the PIT-37 is entitled Dochody i straty podatnika. Since we often talk about ‘profit and loss’, why do we not translate dochody i straty podatnika using the word ‘profit’? The answer is that the personal income returns of private individuals do not concern profits. Private individuals do not report ‘profits’ in this context – they do not have profits, they have incomes, although the two concepts are essentially the same. In the same way, private individuals do not report ‘revenues’ in their personal tax returns, because they do not have revenues, they have incomes. The equation ‘revenues less costs = income’ is quite incorrect, and the distinction being drawn between ‘revenue’ and ‘income’ will be completely incomprehensible to anyone who is not familiar with the terms przychód brutto or dochód brutto.
Peter Nicholson (X)
Poland
przychód brutto is ‘total income’
18:14 Mar 1, 2011
The two questions which initiated this discussion ( http://sameurl.com/Yclip and http://sameurl.com/q6KKS ) concern a statement issued by the Polish tax authorities giving details of the income of a family of individuals. The statement, as far as I know, contains two figures: przychód brutto and dochód brutto. It doesn’t contain four or five different kinds of przychód brutto, it contains a single, final figure which is the sum of several sources of income (przychód razem) and is now called przychód brutto by the Tax Office. The same goes for dochód brutto. Przychód brutto is ‘total income’ (‘statutory total income’ in a UK tax return).
Peter Nicholson (X)
Poland
PIT-37
18:13 Mar 1, 2011
You are right, Krzysztof, when you say the PIT-37 form does not use the terms przychód brutto or dochód brutto. This is significant, and is because each of the figures entered, for example, into each of boxes 39, 44, 47, 52 and 57 could be called przychód brutto. However, it would similarly be possible to refer to the figure entered in box 62 as przychód brutto, but this last figure is of a fundamentally different nature from the former ones and has to be distinguished from them. This is because it is the sum of several forms of income, and is in the line called razem. Couldn’t we call this one ‘totalprzychód’?
Krzysztof Kajetanowicz (X)
Poland
fields
16:37 Mar 1, 2011
The total amounts (total przychód and dochód) are in boxes 62 and 64 respectively. Przychód and dochód per source are above, except that a loss (negative dochód) from a source does not offset dochód from other sources, so it is eliminated from total dochód.
Peter Nicholson (X)
Poland
Which field?
14:19 Mar 1, 2011
Yes, I know which columns, but which box numbers will contain the figures which we could call 'przychód brutto' and 'dochód brutto'?
Krzysztof Kajetanowicz (X)
Poland
it's there
14:12 Mar 1, 2011
Doesn't say 'brutto' but it is indeed przychód brutto and dochód brutto (here: before income tax), in the 2nd and 4th column in section C.
2. As far as UK tax returns go, I'll have to take your word for it. However, it's the Polish tax return that we're discussing. If 'total income' in the UK tax return is the sum of several types of income, it is something completely different from what we call 'przychód brutto'.
The crucial difference for Polish tax purposes is between whatever you make - 'przychód' - and your bottom line (whatever you make after you've paid the allowable costs - 'dochód'). This pertains to business income, income from rental and even employment income.
- Everything you report in your standard tax return is taxed on a net-of-costs (dochód) basis
- Dividends and interest are taxed on a no-costs (przychód) basis but you don't report this - rather, your bank or stock broker withholds and reports the relevant taxes
- Ryczałt od przychodów ewidencjonowanych is an exception from the above rule, where you report your business sales ('przychód') and have it taxed, and you're not allowed to deduct costs. Hence the crucial meaning of the distinction.
Krzysztof Kajetanowicz (X)
Poland
#1
13:52 Mar 1, 2011
1. Well, it is clear to me. It does not use 'profit' as 'przychód' (turnover, sales, revenue).
Gross Profit is Revenue minus Cost of Goods Sold. Also referred to as Gross Margin. It's a measure of your proftability, not your sales/turnover/przychód. Thus, 'me and the others' would translate 'profit' as 'zysk', which is more or less synonymous to 'dochód' and which we want to call 'income' (when opposed to przychód).
'Gross' is no evidence to the contrary. Here, 'Gross' means 'before further cost items' but in a different context it might mean 'before income tax' or 'including VAT'.
Peter Nicholson (X)
Poland
Krzysztof
13:23 Mar 1, 2011
The Quarterly Profit and Loss Statement shown in the article you have just cited is absolutely clear. It uses the term ‘profit’ in a position which I think you and others want to reserve exclusively for the word ‘revenue’. Note, however, that it uses the terms ‘profit’ and ‘income’ synonymously. We could equally well use the terms ‘profit before tax’ or ‘pre-tax profit’ here. Note, too, how it uses the word ‘gross’ to refer to profit (i.e. income or revenue) less costs of goods sold, in contradistinction to the way ‘gross’ has been used in this question: http://sameurl.com/Yclip . In the context of a UK income tax computation for a natural person, the answers I have given of ‘total income’ and ‘taxable income’ could hardly be clearer. Total income is the sum of several types of income, such as salary, interest income and dividend income. Taxable income is the sum that is liable to tax. I do not think the concepts differ, here, between Polish and UK law, and the distinction being made between revenue and income just doesn’t wash.
Krzysztof Kajetanowicz (X)
Poland
Peter
12:46 Mar 1, 2011
You've made a good point. IFRS terminology is terribly convoluted. I myself sometimes use "finance income" in the revenue section of a company's P&L account. You sometimes see "revenue" and "income" used interchangeably, provided that the context is appropriate for precise understanding of the term in question. Perhaps it's because the IFRS are a compromise between various local influences.
However – for Polish tax purposes, you need a very clear distinction between "money earned" and the bottom line, since this is the difference between "przychód" i "dochód". This is perhaps easier to disinguish under USGAAP:
So if you think "income" is an appropriate translation of "przychód", how would you go about "dochód"? Keep in mind that, as correctly pointed out in one of your quotes, "gains" are normally connected with disposal of assets (e.g. securities), so this only captures a very specific part of the bottom line.
Peter Nicholson (X)
Poland
Rozróżnienie między przychodami i zyskami
12:32 Mar 1, 2011
[The distinction between income, revenue and gains] Rozróżnienie między przychodami i zyskami [The IASB’s Framework for the Preparation and Presentation of Financial Statements defines income as ...] Przychody w Założeniach koncepcyjnych sporządzania i prezentacji sprawozdań finansowych RMSR zdefiniowane zostały jako ... [The Framework explains that this definition of income encompasses both ‘revenue’ and ‘gains’.] W Założeniach koncepcyjnych wyjaśniono, że zakres znaczeniowy definicji przychodów (ang. income) obejmuje zarówno „przychody” (ang. revenue), jak i „zyski” (ang. gains). [Revenue arises in the course of the ordinary activities of an entity ...] Przychody powstają w ramach działalności gospodarczej jednostki ... [gains represent other items that meet the definition of income] mianem zysków określa się inne pozycje, które spełniają warunki definicji przychodów ... [Consequently, in distinguishing between ‘gains’ and ‘revenue’ in its definition of income, the IASB is able to exclude ...] Ze względu na rozróżnienie między „przychodami” i „zyskami” w definicji przychodów RMSR mogła wykluczyć …
Peter Nicholson (X)
Poland
MSSF
12:31 Mar 1, 2011
Now let’s take a careful look at how that section from GAAP looks in the published translation made by experts from Katedra Rachunkowości Menedżerskiej at SGH.
Peter Nicholson (X)
Poland
The distinction (continued)
12:30 Mar 1, 2011
Consequently, in distinguishing between ‘gains’ and ‘revenue’ in its definition of income, the IASB is able to exclude ‘gains’ from the scope of IAS 18, thereby avoiding the issue of the recognition of gains that are earned but unrealised.
Peter Nicholson (X)
Poland
The distinction between income, revenue and gains
12:30 Mar 1, 2011
The distinction between income, revenue and gains The IASB’s Framework for the Preparation and Presentation of Financial Statements defines income as ‘increases in economic benefits during the accounting period in the form of inflows or enhancements of assets or decreases of liabilities that result in increases in equity, other than those relating to contributions from equity participants’. The Framework explains that this definition of income encompasses both ‘revenue’ and ‘gains’. Revenue arises in the course of the ordinary activities of an entity and is referred to by a variety of different names including sales, fees, interest, dividends, royalties and rent; gains represent other items that meet the definition of income and may, or may not, arise in the course of the ordinary activities of an entity. Gains include, for example, those arising on the disposal of non-current assets. The definition of income also includes unrealised gains; for example, those arising on the revaluation of marketable securities and those resulting from increases in the carrying amount of long-term assets.
Peter Nicholson (X)
Poland
International GAAP
12:29 Mar 1, 2011
Let’s take a look at the terms ‘revenue’ and ‘income’ as defined in International GAAP: Generally Accepted Accounting Practice under International Financial Reporting Standards, published under the auspices of Big Four company Ernst & Young.
Peter Nicholson (X)
Poland
Confusing title
12:28 Mar 1, 2011
James Hutchison’s use of accounting terms in the first article cited by Krzysztof is extremely misleading. The title suggests the article will explain a difference between ‘revenue’ and ‘income’, whereas it in fact explains the difference between ‘income’ (or what in less technical situations is its synonym, ‘revenue’) and ‘net income’. The second article confuses the issue in a similar way.
Peter Nicholson (X)
Poland
Discussion continued
12:27 Mar 1, 2011
This discussion is carried over from another recent question at: http://www.proz.com/kudoz/polish_to_english/finance_general/... , a question which relates to personal income tax due from an individual, and so to a statement which does not directly concern sales and which does not, therefore, contain information about revenue as a separate item.
Works the same for individuals as it does for companies. If you pay personal income tax, it's also due on revenues less costs (even if, as is the case with employees, the costs are legally pre-determined on a very low level).
Peter Nicholson (X)
Poland
Krzysztof
09:54 Mar 1, 2011
Can you explain why you think revenues less costs = income?
From the Oxford Dictionary of Accounting: flat tax (proportional tax) A tax with a single rate (as opposed to one in which the rate of tax increases with the size of the tax base) and with no reliefs or exemptions apart from a standard personal allowance.
Since a flat tax never carries reliefs or exemptions, it is not necessary to use the words ‘without deductible costs’ in our translation. Indeed, this will only be confusing. The word ‘lump’ or lump-sum’ here is completely inappropriate, because the tax concerned simply is not a lump sum – it is a percentage of revenue. Yes, ‘revenue’ here, because we are talking about income from sales. The word ‘registered’ also carries the wrong connotations, here. ‘Recorded’ is much better, but ‘booked’ might be better still. Consideration should be given to the reason why ryczałt od przychodów ewidencjonowanych has been given this name. I do not know why the word ryczałt should be considered appropriate for this tax. Every tax in the world is based on income/revenues which have been booked, recorded, noted or detected – it would not be possible to levy a tax otherwise. It follows that special significance should not be seen in the word ewidencjonowanych, and that we do not need to specify this feature of the tax in the translation of its name. However, the word przychodów is used in contradistinction to dochodów, and this is precisely to indicate the fact that no reliefs or exemptions are allowed. Ryczałt od przychodów ewidencjonowanych is no ordinary proportional tax levied on the income of all private individuals, such as is in operation in several countries around the world. Our tax applies to specific groups of people, with a different rate for each group. The groups are defined on the basis of the kind of job done. Not all of these jobs may be called ‘professions’, so I have opted for ‘occupations’. In the appropriate context, the words ‘specified occupations’ could be substituted with the name of the occupation concerned.
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peer agreement (net): -1
