Taxes in Europe Database v2
Act of 26 July 1991 on personal income tax (consolidated text: Journal of Laws of 2012 item 361 with subsequent amendments).
Act of 20 November 1998 on lump-sum income tax (Journal of Laws, No. 144, item 930 with subsequent amendments) in force since 1999/01/01.
49.52% of the revenues from PIT (general terms) is a share of the local authorities.
All revenue from “tax card” are the local authorities revenue.
All revenue from lump-sum income tax (except from “tax card”) are the state budget revenue.
Territory of Poland.
Residents are taxed on their worldwide income, non-residents on their Polish source income.
Married couples, who co-own property and remain married during the whole tax year, may, at request, be taxed jointly (the tax is assessed on behalf of both spouses in the amount equal to double tax calculated for half of the joint taxable incomes of the spouses, provided that the sum of such incomes shall not include incomes (revenues) liable to flat tax rate of 19% or a lump sum taxation or to tonnage tax). The same rules apply to a person who brings up children alone (single parent).
Categories of sources of revenue are:
Tax base is determined separately for each category of revenue. Generally tax base is determined as income (revenue minus tax costs) after deductions (e.g. obligatory social security contributions). It is also possible to deduct some expenses from tax (e.g. obligatory health contributions).
Losses from one category of revenue cannot be covered by income from other category. Losses can be deducted from the income earned from the same sources during the following 5 tax years.
Benefits in kind (e.g.: a company car or a telephone) received by an employee are not taxable if they are used exclusively for business. Some of benefits in kind are tax free considering their financial source (e.g. cultural cheques financed from employer’s social fund).
Interest on mortgages – this tax relief was in force till 31st December 2006. On the basis of acquired rights taxpayers can benefit from interest tax relief until the end of 2027.
Deductions from income:
Deduction from tax:
In the case of low income group there is a possibility to profit from the tax relief. Taxpayers, whose tax due is lower than total amount of child relief, can receive the difference. However it is limited up to the total amount of social security and health contributions paid by taxpayer, which are subject to tax deduction.
Inheritance is a subject to special tax therefore it is not subject to income tax.
Income from transfer against consideration of things, which were acquired longer than 6 months before.
The incomes (revenues) on:
Abovementioned incomes can not be combined with other category of incomes.
Tax is payable annually on the basis of tax returns, not later than on 30th April of the following year.
Generally on income earned from money capitals tax is withheld at source at the day of payment.
Monthly tax advanced payments are paid on income from employment contract, independent personal activity, lease and tenancy, not later than 20th day of the following month.
Tax can be paid in quarterly advance payments on non-agricultural business activity income (small taxpayers, taxpayers commencing business activity or taxpayers taxed according to the lump-sum taxation Act).
The advance payments are deductible against final income tax liability.
Due tax (or advance payment) is to be paid to the competent tax authority (local tax office) by taxpayer or by tax remitter.
Tax remitters are obliged to calculate and collect throughout the year income tax advance payments, for example, if remitter is:
Tax remitters collect throughout the year the lump sum tax, for example banks - in case of interest or other revenues earned from cash means deposited on the taxpayer's bank accounts.
Taxpayers who derive an income from:
are obliged to pay monthly tax advance payments for their income tax.
The tax advance payments for the period from January to November shall be remitted by the 20th day of every month for the preceding month. The advance payment for December shall be remitted until the 20th January following the end of tax year (apply to income derived from an economic activity and lease or tenancy).
The tax advance payments for the period from January to November shall be remitted by the 20th day of every month for the preceding month. The advance payment for December shall be remitted in date of submission of a tax return on the amount of income earned (loss incurred) during the tax year (apply to income derived from employment relationship, said income received from abroad and retirement and other pensions received from abroad without the intermediation of remitter).
The tax year is from 1st January to 31st December.
I. Business activity income.
Income is taxed according to the progressive tax scale. Taxpayers can also choose between taxation according to general terms (progressive tax scale), flat tax rate of 19% of income, lump-sum taxation or “tax card”. Submission of written declaration on the choice to local tax office is obligatory.
The lump-sum taxation may be chosen by a taxpayer who in the previous year raised revenue from economic activity at the amount not exceeding 150,000 €, or when - in the case of partnership - the revenue raised by the all partners from such an activity did not exceed 150,000 €.
The lump-sum tax rates on registered revenues amount to:
Tax base is revenue without deduction of costs.
Rates of “tax card” are specified in amount in tax office decision and depend on:
II. Married couples and single parent.
Married couples may, at request, be taxed jointly (the tax is assessed on behalf of both spouses in the amount equal to double the tax calculated for half of the joint taxable incomes of the spouses, provided that the sum of such incomes shall not include incomes (revenues) liable to flat tax rate of 19% or a lump sum taxation or to tonnage tax). The same rules apply to a single parent.
Non-residents are taxed only on their Polish source income (lump sum taxation at rate of 20% or 10%, depending on category of income, of revenue). They can however avail themselves of the option of choosing to be treated as a resident taxpayer. Then the general terms (progressive tax scale) also apply to them.
Following conditions must be fulfilled in such case:
IV. Non-resident married couples may avail themselves of the option of choosing to be treated as resident married couples. Then preferential taxation as described in point II. also apply to them.
Following conditions must be fulfilled in such case:
The same rules apply to non-resident person solely bringing up a child.
All taxpayers may, in their annual tax return, indicate a public benefit organization, on benefit of which tax office will transfer 1% of his tax due.