Withholding tax on interest in Poland: What non-resident companies need to know

Withholding tax on interest in Poland applies when a Polish company pays interest to a non-resident entity. The tax rules outline the standard and maximum rates, specify when exemptions may apply—particularly for EU-based recipients—and may also require certain reporting steps.

If your business receives interest from Polish sources, it’s important to understand how these rules apply to avoid costly mistakes or compliance issues.

This article provides an overview of the key aspects of withholding tax on interest in Poland, with a focus on what non-resident companies need to know.

Who should pay attention?

Withholding tax on interest in Poland is a key issue for non-resident companies that receive interest payments from Polish entities. Whether you’re funding a local business or structuring cross-border loans, understanding how the Polish rules apply is essential to avoid tax inefficiencies or compliance problems.

This topic is especially relevant for:

If your company fits any of these categories, reviewing your approach to withholding tax in Poland can help reduce risks and ensure smoother operations.

Key overview of withholding tax on interest in Poland

Pay and refund mechanism; If interest repaid to foreign related entity exceeds PLN 2,000,000 per year, standard withholding tax rate of 20% applies on the excess of PLN 2,000,000, regardless of the right to benefit from more beneficial withholding tax rate or exemption (provided that the tax remitter submitted neither withholding tax statement nor has obtained an opinion on tax preferences from the tax office). A withholding tax refund may be applied for.

Special requirement for the application of withholding tax exemption on interest payments to EU tax residents (except for the rules defined by the EU Interest & Royalty Directive)

Specific reporting obligations in relation to the interest payment made to non-resident entities

Why it matters: More than just a tax rate in Poland

Withholding tax on interest in Poland involves more than applying a fixed percentage. The final outcome can depend on factors like the recipient’s country, the loan structure or whether treaty relief or exemptions apply.

Without a proper understanding of the Polish rules, businesses risk overpaying tax, failing to meet reporting obligations or facing penalties. Knowing the requirements helps you stay compliant, lower tax exposure and manage cross-border funding with more confidence.

“Withholding tax, based on international double tax treaties and mandated by EU directives, can be a major challenge especially for multinational groups. Despite being only a small part of income tax laws, withholding tax issues are one of the most doctrinally and tax audit-intensive areas of taxation in Poland.

The catch for entrepreneurs is the routine approach to accounting for this particular tribute. The changing regulations, the evolving practice of the authorities, and finally the duty of due care give a great space for easy failure of WHT obligations. Only last month provided us with further surprising rulings and also clarifications from the Ministry of Finance, which have been awaited for several years.

If the responsibility for WHT is not entrusted to an experienced tax advisor, a clear procedure that provides for WHT compliance for each disbursement scenario proves crucial. Dividends, interest, licenses, industrial equipment – payment of even a single zloty to a non-resident triggers WHT compliance obligations”. Jakub Czerski | Tax Director

“Coordination between local and foreign teams when handing WHT documentation or exemptions is very important. Polish provisions and clarifications oblige Polish tax remitters to proceed with due care while determining the right for WHT exemption or application of reduced rates according to double tax treaties. It may result i.e. in requirement to verify the financial statement of the lender or some source agreements confirming the sufficient infrastructure at the lenders. Without a smooth cooperation with foreign teams executing a due care at a proper level is hardly possible”. Anna Kołakowska (Maksymiuk) | Tax Supervisor

Anna Kołakowska

Tax Supervisor | Accace Poland

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Jakub Czerski

Tax Director | Accace Poland

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Get the right support for withholding tax in Poland

At Accace Poland, we help businesses manage withholding tax and other international tax matters with clarity and care. Whether you’re planning intercompany financing or need help staying compliant with local tax rules, our team is ready to assist.

Our services include:

• Tax advisory, compliance and planning: Support with withholding tax, corporate tax filings, local requirements and tax-efficient structuring of cross-border interest payments
• Transaction support: Guidance on due diligence and financing structures tied to mergers, acquisitions or shareholder loans involving interest payments and potential WHT exposure

With practical experience and a proactive mindset, we help ensure your business remains compliant, tax-efficient and well-prepared for local and international obligations.