Taxes in Poland

Corporate income tax (CIT)

• Non-residents pay CIT only on local income, residents - on global income.
• The standard rate is 19%.
• Nevertheless, small companies (so-called small taxpayers) can benefit from a reduced 9% income tax, provided that their income does not exceed €2 million during the tax year.
• If a company's activities relate to intellectual property, income from such activities may be taxed at the rate of 5%.
• Companies that do not pay dividends and reinvest profits do not need to pay income tax (i.e. 0% tax) if they fulfill specific criteria. This is the so called Estonian CIT, which you can take advantage of if, for example:
• you are not a credit or financial institution
• your shareholders are individuals only
• you derive your income mainly from activities (not from passive income)
• you have filed a notification with the competent tax authority
• you do not operate in a special economic zone
• you employ more than 3 full-time employees
• you do not prepare financial statements in accordance with IFRS

Personal income tax (PIT)

• Individuals who are residents for tax purposes in Poland are taxable on their worldwide income.
• The tax rates are: annual taxable income up to PLN 120,000 (approx. €28,000) is taxed at 12%; annual taxable income above PLN 120,000 (approx. €28,000) taxed at 32%.

Value-added tax (VAT)

• The standard rate is 23%.
• Reduced rates are 8% (e.g. healthcare products, admissions to cultural, sporting and recreational events and hotels), 5% (e.g. some basic foodstuffs and books), 0% (export of goods and services).
• The threshold for compulsory VAT registration for a taxable person with a registered office, place of business or permanent establishment in Poland is a turnover of PLN 200,000 (approx. €46,000) reached during the previous 12 consecutive months.

Double taxation avoidance agreements in Poland: Albania, Algeria, Armenia, Australia, Austria, Azerbaijan, Bangladesh, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Canada, Chile, China, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Egypt, Finland, France, Georgia, Germany, Greece, Hungary, Iceland, India, Indonesia, Iran, Ireland, Israel, Italy, Japan, Jordan, Kazakhstan, Kyrgyzstan, Korea, Kuwait, Latvia, Lebanon, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Mexico, Moldova, Mongolia, Montenegro, Morocco, Netherlands, New Zealand, Nigeria, Norway, Pakistan, Philippines, Portugal, Qatar, Romania, Russia, Serbia, Singapore, Slovak Republic, Slovenia, South Africa, Spain, Sri Lanka, Syria, Sweden, Switzerland, Tajikistan, Thailand, Tunisia, Turkey, Ukraine, United Arab Emirates, United Kingdom, United States of America, Uruguay, Uzbekistan, Vietnam, Zambia and Zimbabwe.