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Child tax relief 2024 and PIT tax settlement. Who and how can benefit from pro-family relief?

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Child relief (pro-family) is one of the most popular tax deductions. Thanks to the child relief – after submitting your PIT – you can receive a tax refund. Nearly 5 million taxpayers benefit from the relief. Check if and how you can take advantage of the pro-family relief in your PIT settlement for 2023.

Settlements PIT for 2023 they start on February 15. If someone wants to take advantage of deductions from income or tax, they should do so in the PIT-37 or PIT-36 tax return, which are submitted to the tax office by April 30.

How to reduce tax? One of the ways is to apply the so-called pro-family relief child relief. Thanks to it, after submitting the annual PIT declaration, we can count on a refund of the overpaid tax to the tax office.

“4.7 million taxpayers took advantage of the child tax relief. The amount deducted from tax, plus an additional refund for the child tax relief, amounted to PLN 7 billion,” the Communication and Promotion Office of the Ministry of Finance told the business editorial staff of tvn24.pl.

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You can also settle accounts with the tax office using the Your e-PIT service. However, in the case of child tax relief, some taxpayers must take additional steps to obtain it tax refund receive the full amount.

Read more: Trap in child tax relief – how to recover the full amount >>>

Child tax relief 2024 – who can benefit?

Parents are entitled to child relief, legal guardians or acting as a foster family and receiving income taxed according to the tax scale (both as a resident and a non-resident for tax purposes) – explained on the government website.

The deduction in the PIT return for 2023 is available for children:

1) minors (under 18 years of age); 2) regardless of their age, if they received care allowance (supplement) or social pension; 3) up to the age of 25, if they are studying in Poland or abroad, if these children have not obtained: – income subject to taxation according to the tax scale or cash capital, with the exception of survivors’ pensions; – or revenues in the total amount exceeding twelve times the amount of the social pension (PLN 19,061.28).

From child relief can not take advantage people earning only income:

– taxed at 19%. flat tax on the title business activity or special sectors of agricultural production, – taxed with a flat-rate income tax (registered lump sum, tax card).

Persons who also received income taxed according to the tax scale (e.g. remuneration for work, sickness benefit, income from private rental) have the right to indicate the amount to be deducted in their tax return.

PIT for 2023 – limits on child tax relief

The deduction is available to parents and guardians whose income have not exceeded in the tax year the amounts:

– PLN 112,000 in a married couple (income with the spouse is added), – PLN 112,000 in the case of single parents, – PLN 56,000 in the case of unmarried persons (also for part of the year).

According to the Ministry of Finance, you are entitled to relief regardless of the amount of income you obtained if you exercised parental authority:

– in relation to two or more children; – in relation to one child who has: 1) a decision qualifying the adjudicating authorities to one of three degrees of disability, or 2) a decision granting a pension for total or partial incapacity for work, a training pension or a social pension, or 3) a decision on disability of a person who is under 16 years of age.

The above rules also apply to you if you supported an adult child (children) in connection with the performance of your maintenance obligation and in connection with the function of a foster family.

“Parents’ income for the purposes of benefiting from the pro-family relief is understood as income obtained in total in a given tax year: taxed according to the tax scale, from monetary capital taxed at a 19% tax rate (e.g. from paid sale of securities), from non-agricultural business activities taxed 19% tax rate, less paid social security and health insurance contributions (flat tax),” it said.

Child tax relief – how much is it?

The pro-family relief is granted in the amount of:: :

– for the first child – PLN 92.67 per month (PLN 1,112.04 per year), – for the second child – PLN 92.67 per month (PLN 1,112.04), – for the third child – PLN 166.67 per month (PLN 2,000.04). ), – for the fourth and each subsequent child – PLN 225.00 (PLN 2,700.00).

On the government website, the effect of the child relief is presented on the example of a parent with three children. “Then the relief will amount to: PLN 1,112.04 for the first child, PLN 1,112.04 for the second child, PLN 2,000.04 for the third child, i.e. a total relief of PLN 4,224.12 per year” – it was written.

It was emphasized that “the deduction applies jointly to both parents, legal guardians of the child or married foster parents.”

Additional refund in the case of child tax relief

“If you do not have enough tax to deduct the full amount of relief, you may receive the difference in the form of: additional refund” – indicated on the government website.

It is explained that the amount that can be received “is limited” and “cannot exceed the deductible social security contributions and health insurance contributions paid less the health insurance contributions deducted from the flat tax or flat-rate income tax.”

“These contributions may also include social security contributions paid on income covered by: PIT exemption for young people, exemption for returnees, exemption for families 4+, exemption for working seniors,” it was reported.

It was emphasized that social security and health insurance contributions which were deducted in the return cannot be included PIT-28in the PIT-36L return or were shown as deducted in PIT-16A.

Child tax relief – how to document it?

Child tax relief can be included in your tax return – the number of children and their PESEL numbers are provided, and in the absence of these numbers – the names, surnames and dates of birth of the children.

“At the request of the tax authorities, you are obliged to present certificates, statements and other evidence necessary to establish the right to deduction, in particular: a copy of the child’s birth certificate; a family court certificate on the appointment of the child’s legal guardian; a copy of the court decision on the establishment of a foster family or an agreement concluded between the family substitute and the starosta; a certificate confirming that an adult child attends school,” it was explained.

Child tax relief – what PIT tax?

To claim child relief, you must submit:

– proper tax return – PIT-36 or PIT-37– together with the attachment PIT/O.

The PIT/O attachment should include the children’s PESEL numbers, and if these numbers are missing, their names, surnames and dates of birth.

“If you tax your income together with your spouse, you submit one PIT/O. If both of you are entitled to the relief, but you submit separate tax returns, each of you enters the amount you deduct from tax in the PIT/O attachment. If the deduction is made by only one of you, , the second one does not attach PIT/O to his/her return,” it was explained.

More information can be found on the website taxes.gov.pl/pit/ulgi-odlicza-i-zwolnienia/ulga-na-dziecko/.

Child tax relief in your e-PIT

There are situations where parents or guardians meet the conditions to benefit from the pro-family relief, but do not have sufficient income, which means that the tax payable is low and they do not have anything from which to deduct the relief. In such a case, it is still possible to return the unused amount of the pro-family relief.

The taxpayer must submit an application for a refund of the undeducted surplus over the deducted amount or for the entire value of the child tax relief – if the tax is PLN 0. However, there is a limit that is equal to the amount of social security and health insurance contributions that were paid in a given year. When in a given year social Security contributions were not paid at all, it is not possible to receive a refund of the unused pro-family relief.

The Ministry of Finance explains that in order to receive such a refund as part of the Your e-PIT service, the taxpayer must use the “add a refund for unused child tax relief” functionality available in the “Your tax relief and deductions” section as information regarding the child tax relief.

The Your e-PIT service is crucial because data from the Ministry of Finance show that for the 2022 tax year, most taxpayers settled electronically – approx. 20 million declarations, including approx. 11.9 million via the Your e-PIT electronic platform and approx. PLN 8 million via e-Declarations. Approximately 1.3 million PITs were submitted in paper form.

According to the Ministry of Finance, “4.7 million taxpayers took advantage of the child tax relief” and “the amount deducted from tax increased by an additional refund for child tax relief amounted to PLN 7 billion, including:

– 2.7 million taxpayers benefited from the tax deduction, and the amount deducted from tax amounted to PLN 3.9 billion, – additional refund for the child tax relief (the amount being the difference between the amount of the deduction and the amount deducted in the tax return up to the total amount of contributions ZUS i National Health Fund) received 2.4 million taxpayers in the amount of PLN 3.1 billion.

Main photo source: Shutterstock

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