VAT-26 and 100% Deduction — Business-Only Car in Poland (2026)

A full VAT deduction (100%) and a full PIT cost (100%) for a passenger car are possible — but they require strict conditions to be met. A mere statement by the entrepreneur is not enough.

Most entrepreneurs lose the right to 100% because of a missing mileage log or a late VAT-26 filing.

Two provisions, one condition: exclusion of private use

PIT — 100% deductible expenses

Art. 23 sec. 1 item 46a of the income tax (PIT) Act (Dz.U. 2026 poz. 592) limits deductible expenses (KUP) to 75% for a passenger car in mixed use. The full 100% is possible a contrario — when the car is used exclusively in the business.

VAT — 100% deduction

Art. 86a sec. 3 item 1 lit. a and sec. 4 of the VAT Act (Dz.U. 2025 poz. 775) allow a full VAT deduction when the construction or manner of use of the vehicle rules out private purposes.

Four conditions for a 100% deduction

To apply 100% VAT and 100% deductible expenses, all of the following must be met jointly:

1. Filing VAT-26

A VAT-26 notification must be filed with the head of the tax office by the 25th day of the month following the month in which the first expense related to the vehicle was incurred, but no later than on the day of submitting the JPK_V7.

A missing or late VAT-26 triggers the obligation to apply 50% VAT from the first month.

2. Vehicle mileage log

The mileage log must contain:

• the vehicle's registration number and the driver's name and surname,
• the date and purpose of the trip,
• a description of the route (from–to),
• the number of kilometres travelled,
• the entrepreneur's signature.

The log must be kept on an ongoing basis — it cannot be reconstructed retrospectively.

3. Rules for using the vehicle

Internal rules for using the vehicle must be established that rule out private journeys. An internal document (regulations, a resolution) is required.

4. Actual exclusion of private use

A mere statement is not enough. The manner of use must actually rule out private journeys. If tax authorities detect private journeys, the 100% is reversed and 50% VAT + 75% deductible expenses apply.

What happens without VAT-26

If VAT-26 is not filed or is filed late:

• VAT: 50% deduction applies (Art. 86a sec. 2 VAT),
• PIT: 75% deductible expenses apply (Art. 23 sec. 1 item 46a PIT),
• the presumption of mixed use applies.

A 100% VAT deduction and 100% deductible expenses apply from the first day of the month in which VAT-26 is filed (not from the month following the filing).

2026 depreciation limits

A full 100% of costs does not mean there is no value limit. The depreciation limits for passenger cars from 2026 depend on powertrain and CO₂ emissions:

• PLN 225,000 — electric or hydrogen vehicle,
• PLN 150,000 — combustion-engine vehicle with CO₂ emissions below 50 g/km,
• PLN 100,000 — combustion-engine vehicle with CO₂ emissions of at least 50 g/km.

If the car's value exceeds the limit, the portion of the write-off corresponding to the excess is not a deductible expense — even in the 100% mode.

More on car limits: A car in a sole proprietorship — PIT and VAT costs.

100% settlement example

An entrepreneur buys fuel for a car used exclusively for business (VAT-26 filed, mileage log kept). Invoice: PLN 100 net + PLN 23 VAT = PLN 123 gross.

• VAT: PLN 23 (100% deduction),
• PIT cost: PLN 100 net (100% deductible expense),
• No non-deducted VAT in costs.

Comparison with mixed use (50% VAT + 75% deductible expenses):

• VAT: PLN 11.50 (50%),
• non-deducted VAT: PLN 11.50,
• PIT cost: (PLN 100 + PLN 11.50) × 75% = PLN 83.62.

The difference is significant — the 100% mode gives a higher cost and a full VAT deduction.

Most common mistakes

1. Deducting 100% without VAT-26

Without filing VAT-26, 50% VAT applies. This is the most common mistake.

2. No mileage log

The absence of a mileage log for VAT purposes causes the reversal of 100% and the obligation to apply 50%.

3. Reconstructing the log from memory

The log must be kept on an ongoing basis. Reconstructing it from memory after several months is invalid.

4. Treating a statement as sufficient

A statement about exclusive business use is not enough. The manner of use must actually rule out private journeys.

FAQ

Does VAT-26 have to be filed every year?

No, VAT-26 is filed once, when the car is registered for business use. But an update must be filed when the conditions of use change.

Does 100% VAT require a mileage log?

Yes. A mileage log is a condition for a 100% deduction for a typical passenger car (Art. 86a sec. 3–4 VAT).

What happens if I do not file VAT-26?

50% VAT and 75% deductible expenses apply. A 100% deduction applies from the first day of the month in which VAT-26 is filed.

Do depreciation limits apply in the 100% mode?

Yes. Even at 100% deductible expenses, the portion of the write-off above the limit (PLN 225,000 / 150,000 / 100,000) is not a cost.

Sources

• VAT Act — Art. 86a sec. 2–4 (Dz.U. 2025 poz. 775)
• PIT Act — Art. 23 sec. 1 item 46a (Dz.U. 2026 poz. 592)
• More on cars in a sole proprietorship: A car in a sole proprietorship — PIT and VAT costs
• More on fuel VAT: VAT on fuel in a sole proprietorship

Need help with a car in your sole proprietorship?

Oxyok accounts for fuel, leasing, depreciation, insurance, and VAT. Accounting starts at PLN 49 + VAT per month.

Write to Paweł or see Oxyok accounting.

Note: A 100% deduction requires VAT-26, a mileage log, and the actual exclusion of private use. The absence of any of these elements reverses to 50% VAT and 75% deductible expenses.