Find out what are the top 10 facts about taxation in Poland – a sum-up of the most important information for any business or individuals who plan to invest in Poland.
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Corporate income tax is levied at a rates of:
- 19% (standard rate) or
- 9% (reduced rate for small taxpayers with revenue in tax year are not higher than 1,2 mln EUR expressed in PLN and new companies in the first year of business activity) or
- 5% (non standard tax rate) for incomes from intangible property
Withholding Tax Rate
Withholding tax* of 19% is levied on income from redemption of shares, participating loans, and dividends.
Withholding tax from interest, license fees, and know-how is 20%.
*From July 2019, in relation to the payment exceeding PLN 2 million it is compulsory to collect withholding tax according to national rates. It can be avoided by using a special certification procedure or submitting statement.
Standard VAT in Poland: 23%
- reduced rates: 5% and 8%
- export of goods and services: 0%
- intra-community supplies of goods: 0% (under certain conditions)
Personal Income Tax
The tax in Poland is progressive and the applicable rates in 2018 are:
- annual taxable income up to PLN 85,528 is taxed at 18%
- annual taxable income above PLN 85,528 is taxed at 32%
Certain types of income are not aggregated but are subject to a flat tax rate of 19%.
Social and health contributions - Employee
Social and Health contributions owed by Polish Employees: 22.71%
Social and health contributions - Company
Social and Health contributions owed by Polish Employees: 19.21 % – 22.41 %
- tax loss from business activities may only be offset against income derived from those types of activities
- losses that cannot be set off may be carried forward for a maximum of 5 years (in a given year, at most 50% of the loss can be utilized)
- in certain cases, it is possible to offset losses of foreign companies
Transaction Tax (PCC)
Certain civil law transactions are subject to this tax in Poland, such as (but not limited to):
- sale of things or rights
- exchange of things or rights
Typically, the tax is levied as a percentage of the transaction’s value – e.g. in case of a real estate sale, the tax amounts to 2% of the property’s market value.
Real estate tax
- the maximum rate of the business land tax is PLN 0.91/m2 (in case of private land it is PLN 0.48/m2)
- the building tax (for business space): PLN 23.10/m2
- the tax for non-business buildings: PLN 0.77/m2
These rates may be modified according to local conditions.