A programmer on a JDG (sole proprietorship) may use the VAT exemption as long as their sales in Poland do not exceed PLN 240,000 in 2026 and they do not provide advisory services for which the exemption is excluded. Services for foreign firms do not count towards the limit, but require VAT UE registration even under exemption. In practice, the decision depends on three questions: who is the client, is there advice in the service and how much VAT is paid on firm purchases.
Step 1: is the exemption available at all
Sales limit
The turnover-based VAT exemption covers a taxpayer whose sales without VAT did not exceed PLN 240,000 in either the previous or the current year. Anyone starting mid-year calculates the limit in proportion to the number of days of running the firm. With a start on 1 July 2026, the limit is around PLN 120,986 (PLN 240,000 × 184 days / 365). The exemption is lost from the transaction on which the limit is exceeded — VAT is charged already on that invoice.
Only "sales" within the meaning of the VAT Act, i.e., among others, services taxable in Poland, count towards the limit. Programming services for a firm with its seat abroad are usually taxed in the client's country, so do not use up the limit.
Services excluded from the exemption
Article 113(13) of the VAT Act strips the exemption from, among others, taxpayers providing advisory services. For an IT specialist this means that invoices for IT advice, architecture audit or technology consultations require VAT registration from the first such service — regardless of the amount. Programming, testing or maintaining systems is not advice, but the description on the invoice and the content of the contract should reflect that. In case of doubt whether a given service is advice, an individual tax interpretation gives protection.
Step 2: who is the client
| Client | Turnover-based exemption | Active VAT |
|---|---|---|
| Polish firm — VAT payer | invoice without VAT; the client has nothing to deduct, but their cost is the same as at the net price | invoice with 23% VAT; the client deducts the tax, the programmer deducts VAT on purchases |
| Firm from the EU | VAT UE registration required; invoice without Polish VAT, the sale does not count towards the limit | invoice with the "reverse charge" note, reported in JPK_V7 and the VAT-UE recapitulative statement |
| Firm outside the EU (e.g. USA, United Kingdom) | invoice without Polish VAT, not counted towards the limit | invoice "not subject" to Polish VAT, with the right to deduct VAT on purchases |
| Private persons | the exemption really lowers the price for the client | 23% VAT raises the price or cuts the margin |
A programmer working exclusively for a Polish company on a B2B contract usually achieves sales above the limit and must register anyway. At a rate of PLN 20,000 net per month, the PLN 240,000 limit is exhausted exactly over a year, and an amount higher by even one zloty means the obligation.
Step 3: purchases from abroad and VAT UE
A programmer's tools — IDE licences, cloud hosting, subscriptions — are often bought from firms in the EU or outside it. For the Polish firm this is an import of services: tax is settled by the buyer. A VAT-exempt taxpayer must register for VAT UE before the first such purchase from an EU counterparty, and pays the tax on the import of services without the right to deduct. An active VAT payer reports the same tax as output and input tax simultaneously, so nothing is paid in addition.
Comparative example
A programmer issues a monthly invoice of PLN 18,000 net to a Polish company. He buys licences and cloud services from foreign suppliers for PLN 600 per month and equipment and services in Poland for PLN 1,500 net per month.
- Exemption: annual sales PLN 216,000 — within the limit. On the import of services he pays 23% × PLN 600 = PLN 138 per month without deduction, and domestic purchases are paid at the gross price (PLN 1,845). Monthly he loses around PLN 483 of VAT.
- Active VAT: the client pays PLN 22,140 but deducts PLN 4,140 of VAT, so their cost does not change. The programmer pays in PLN 4,140 minus PLN 345 of VAT on domestic purchases; the import of services is neutral. Over the year he recovers around PLN 5,800 of tax, which under the exemption would have been his cost.
The result is unambiguous when the client is a VAT payer. The exemption defends itself mainly for private clients or very low firm outlays.
How to move to active VAT and back
- File the VAT-R notification before the day of the first taxable act or — on resignation from the exemption — before the start of the month from which you want to settle VAT.
- For an EU client or EU service purchases, mark VAT UE registration on the same form.
- From the first period file JPK_V7M (or JPK_V7K as a small taxpayer after 12 months) by the 25th day of the following month.
- Issue invoices in KSeF, which from 2026 covers successive groups of entrepreneurs.
Resigning from the exemption or losing it blocks return: the exemption can be used again at the earliest after one year, counted from the end of the year in which the resignation or loss occurred. The course of registration for EU transactions is described in the article on VAT UE registration.
VAT and the form of income taxation
The VAT status does not depend on the choice of ryczałt, scale or flat tax (podatek liniowy). A programmer on 12% ryczałt may and often should be an active VAT payer. Ryczałt is calculated on net revenue, so VAT on the invoice does not increase income tax. The industry's ryczałt rates are discussed in the article on 12% and 8.5% ryczałt in IT.
How Good Balance can help
We analyse the structure of clients and purchases, prepare the VAT-R and VAT UE notification, and then run the settlements, JPK and invoicing in KSeF. See the VAT invoice handling service.