insights

Tax estimation

Roughly how much to set aside for the next quarterly tax payment.

The tax estimation widget on Insights → Financial Health is a back-of-the-envelope calculation to help you plan cash flow around tax obligations. It’s not a substitute for an accountant.

How it’s computed

ytd revenue       = sum of all revenue-categorized transactions, jan 1 → today
ytd expenses      = sum of all expense-categorized transactions, jan 1 → today
ytd tax liability = (ytd revenue − ytd expenses) × org tax rate
quarterly estimate = ytd tax liability / number of quarters elapsed so far
effective rate    = ytd tax liability / ytd revenue (as a percentage)

The org tax rate comes from Settings → General → Tax settings. Pick the marginal rate that applies to your business structure (e.g., 19% CIT in Poland for most companies; varies in the US between state + federal + self-employment depending on entity type).

What it doesn’t account for

  • Deductions and credits beyond what shows up in your transactions. R&D credits, depreciation schedules, retirement contributions — your accountant tracks these; we don’t.
  • Estimated payments you’ve already made. The widget shows what you owe year-to-date, not what’s still due after estimated payments.
  • Tax-bracket progressivity. We apply a single rate. If your jurisdiction has graduated rates, the math drifts as your income grows.
  • Sales tax / VAT. Those are tracked separately under VAT settings; the estimation widget is about income tax.

Poland: taxes to pay

If your organization picks a Polish settlement form (Settings → General — skala, liniowy or ryczałt with your ZUS basis for a sole trader; CIT 9%, CIT 19% or Estonian CIT for a company; plus your VAT registration), the widget becomes Taxes to pay and shows two months:

  • Last month, closed. Its income-tax advance and ZUS are due on the 20th of this month, its VAT on the 25th. The list under the figures shows the next payment of each, with its date.
  • This month so far, which keeps growing until the month ends.

How each figure is worked out:

  • Revenue is what you invoiced, dated by the sale date (or the issue date, if earlier), not what you were paid.
  • Income tax is an advance on your income since 1 January, less the advances due for earlier months, the way the tax office counts it. The tax-free amount and the second bracket apply across the year, not to each month. CIT advances work the same way.
  • A company pays no ZUS of its own, so there’s none in its figures. On Estonian CIT the tax falls due only when profit is paid out, so there’s no monthly advance — only VAT.
  • Costs are supplier invoices plus bank payments that don’t pay one. Payments categorised as Tax or Transfer don’t count, so categorise your ZUS and tax-office transfers.
  • VAT is the VAT you invoiced minus the input VAT on supplier invoices whose VAT lines we have (for example from KSeF).

It’s in alpha: the rate tables still need confirming, health contributions skip the minimum amounts, and deadlines on a weekend or holiday aren’t moved. Quarterly settlement isn’t covered yet, and for a company neither are losses from earlier years, simplified advances, costs that aren’t tax-deductible, or whether you still qualify for 9%. A dividend payout counts as a cost unless it’s categorised as Transfer.

How to use it

As a “set aside roughly this much” signal, not a tax return. The quarterly estimate is the number you’d want to transfer to a tax savings account each quarter so you’re not surprised when the bill arrives.

If your effective rate is wildly different from what your accountant tells you, the most likely culprits are:

  1. The org tax rate is set wrong (too high, too low, or wrong jurisdiction).
  2. A large chunk of transactions is uncategorized and not counted.
  3. You have significant deductions or one-time items the widget can’t see.