How does the bank calculate creditworthiness?

In the context of calculating creditworthiness, the way you tax your business is even more important. Banks have very different approaches to entrepreneurs settling on the basis of KPiR and people who have chosen a lump sum or tax card. While for each of these forms, stability and regularity of income is of key importance, the calculation of income looks quite different. If you follow general principles or a flat tax you may feel really privileged if you use one of the other methods – it may be a bit harder to get a loan.


Taxation on general principles

tax loan

The tax scale is a simple form of taxation often used by sole proprietorships and small companies. Banks also like it because it allows them to easily assess the real profitability of a given business. In this case, they calculate income by deducting tax deductible costs from revenues. When examining creditworthiness, they usually take into account the average net income from the last 12 calendar months. Some institutions take into account the net income shown in the last PIT declaration, and some compare the results from the current and previous year and use a lower value.


Flat tax

Flat tax

In this case, banks also do not encounter problems when calculating creditworthiness. Your income is the difference between the revenues they earn and the costs they earn. Compared to the general rules, the difference is that a uniform 19% tax rate is used.


Registered lump sum

If you pay a lump sum, you use one of five percentage rates tailored to the industry in which you operate. Due to the difficulty in estimating the applicant’s actual financial capacity, banks have created a way to assess these capabilities. An entrepreneur settling with a registered lump sum pays tax not on income, but on income, therefore the lender will also focus on income, but will consider only a small part of it.

The type of business you do also determines how your bank will approach your application. Most often, it adopts average monthly net income for the current and previous year, which is equivalent to:

  • 15% of average monthly revenues from trading activities;
  • 20% of average monthly revenues from mixed and production activities;
  • 30% of average monthly revenues from service activities.

Remember that each bank may use a slightly different formula to calculate average monthly net income. In general, the amount taken into account will be much smaller than the amount actually left in your pocket.


Tax card

Tax card

It is the easiest way to settle accounts with the tax authorities, but for banks it is the most difficult case in terms of calculating creditworthiness. This is due to the fact that the tax card is not related to income at all. In her case, you don’t even have to submit a PIT or register your sales. You pay tax based on the rate set by the Tax Office, the amount of which depends, inter alia, on the age of the entrepreneur or the industry of activity.

Banks calculate their average monthly income based on the formula:

average monthly income = monthly tax rate x coefficient adopted by the bank (from 5 to 15)

The coefficient used usually ranges from 5 to 8, which means that entrepreneurs using the card usually show very low creditworthiness or do not show it at all.