Monthly or quarterly income tax advance? Find out what deadlines apply in 2026, who can choose quarterly settlement and how to correctly calculate the amount due.
Income tax advances are one of those obligations that regularly keep entrepreneurs up at night — especially those who have just started their business. An incorrect calculation or a missed deadline can result in interest for late payment and even penalties from the tax office (US). In this article we explain how monthly advances differ from quarterly ones, who can use them, how to correctly calculate the amount due and which deadlines must be strictly observed in 2026.
An income tax advance is a portion of the annual PIT paid on an ongoing basis during the tax year. The state does not wait for the annual return — it requires the taxpayer to settle their liabilities on a current basis as income is earned. This obligation applies primarily to: • individuals running a sole proprietorship (JDG), • partners in partnerships (jawna, partnerska, komandytowa), • individuals settling under the progressive tax scale, flat tax or lump-sum recorded revenue (ryczałt ewidencjonowany). Failing to pay advances on time does not automatically result in a penalty, but it does generate interest for late payment calculated from the day the advance should have been paid. It is therefore worth keeping track of the calendar and the accuracy of calculations throughout the year.
Monthly advances are the standard settlement method for the majority of entrepreneurs. Payments are made by the 20th day of the month following the month for which the advance is due. For example, the advance for January must be paid by 20 February. An exception applies to the December advance — the regulations exempt the taxpayer from making a separate payment for it, provided they file their annual return and settle the resulting liability by the end of January of the following year. Basis for calculating a monthly advance: 1. Determine cumulative income from the beginning of the year (revenue minus tax-deductible costs). 2. Deduct social insurance contributions (ZUS) paid in the given month (if not included in costs). 3. Apply the applicable tax rate (progressive scale: 12% / 32%, flat tax: 19%, lump-sum: rate depending on PKD classification). 4. Deduct advances already paid in previous months of the year. 5. Pay the resulting difference to your individual tax micro-account.
Quarterly settlement is a convenient alternative for those who want to deal with formalities less frequently. A quarterly advance is paid by the 20th day of the month following the end of the quarter, i.e.: • Q1 (January–March) → by 20 April, • Q2 (April–June) → by 20 July, • Q3 (July–September) → by 20 October, • Q4 (October–December) → in the annual return (analogously to the monthly method). Quarterly advances may only be used by: • small taxpayers — i.e. businesses whose sales revenue (including VAT) in the previous year did not exceed the equivalent of EUR 2,000,000, • taxpayers starting a business (in their first tax year). The choice of quarterly settlement must be notified to the tax office (US) (by updating CEIDG or submitting form CEiDG-1) by the 20th day of the second month of the quarter for which quarterly settlement is to apply for the first time.
Let us take a simple example for an entrepreneur settling under the flat tax (19%): Data after 3 months of activity: • Cumulative revenue: PLN 80,000 • Cumulative tax-deductible costs: PLN 30,000 • Social insurance contributions (ZUS) paid: PLN 3,000 • Advances paid for previous months: PLN 5,000 Calculation: 1. Income = 80,000 – 30,000 = PLN 50,000 2. Tax base = 50,000 – 3,000 = PLN 47,000 3. Cumulative tax = 47,000 × 19% = PLN 8,930 4. Advance due = 8,930 – 5,000 = PLN 3,930 Please note that under the progressive tax scale it is necessary to account for the tax-free amount and the progressive rate structure. Under the lump-sum method the tax base is revenue (not income) and the rate depends on the type of activity carried out.
Errors in calculating advances occur even among experienced entrepreneurs. Here are the most frequent ones: • Ignoring the cumulative calculation method — each advance takes into account income from 1 January, not just from the given month. • Forgetting to deduct ZUS contributions — social insurance contributions (not health insurance) reduce the tax base if they have not been included in costs. • Incorrect revenue classification under the lump-sum method — different types of activity may be subject to different rates, even within a single business. • Mismatching the form (monthly/quarterly) with the taxpayer's status — using quarterly advances without entitlement to them creates a tax arrear. • Overlooking the change in the tax threshold — under the progressive scale, exceeding PLN 120,000 of income changes the rate from 12% to 32%, which dramatically increases the advance due.
Since 2022, the health insurance contribution has been linked to the form of taxation and the level of income. In 2026 these rules remain in force, although specific thresholds and rates may be subject to annual legislative updates. Key rules: • Flat tax: the health insurance contribution is 4.9% of income (a minimum contribution applies regardless of income level). • Progressive tax scale: the contribution is 9% of income, with no possibility of deducting it from tax. • Lump-sum recorded revenue (ryczałt ewidencjonowany): the contribution is set as a flat amount depending on the revenue bracket. The health insurance contribution is no longer a tax-deductible cost or a tax deduction to the same extent as before 2022 — the exception being a partial deduction under the flat tax and the lump-sum method. This is an important factor affecting the effective tax burden and should be taken into account when planning the company's cash flows.
Income tax advances require consistency and knowledge of current regulations — a mistake in the method or deadline can cost more than the time saved. If you want to be sure that your company is settling correctly, contact the Danexis accounting office. Our specialists will help you choose the optimal form of settlement and ensure that every payment is made on time. Call us on +48 780 760 666, write to kontakt@danexis.pl or visit us at ul. Braniborska 74/20 in Wrocław.