The taxes at a glance
| Tax | Who pays | Headline rate |
|---|---|---|
| CIT (corporate income tax) | Companies | 19% standard. 9% for small taxpayers and first-year companies. |
| VAT | Businesses selling goods and services | 23% standard, with 8%, 5% and 0% rates for specific supplies |
| PIT (personal income tax) | Individuals, including employees and sole traders | 12% up to PLN 120,000, then 32%. A 19% flat rate is available to business owners. |
| Withholding tax | Payments to non-residents | 19% on dividends, 20% on interest, royalties and certain services, unless reduced or exempted |
| PCC (civil law transactions) | Parties to certain contracts | 0.5% on a company's share capital, and other rates for loans and sales of some assets |
Social security contributions are a separate cost of employment. We cover them in the hiring guide.
Corporate income tax (CIT)
Rates
- 19% is the standard rate on company profits.
- 9% applies to income other than capital gains for small taxpayers, meaning companies whose prior-year revenue did not exceed the PLN equivalent of EUR 2 million. A company in its first year of operation can use the 9% rate until it passes that revenue limit.
Estonian CIT: tax only when you distribute
Companies can opt into a lump-sum regime where profit is not taxed while it stays in the business. Tax is due when profit is distributed or otherwise treated as distributed, at 10% for small taxpayers and 20% for others. The main conditions are that all shareholders are individuals, the company holds no shares in other entities, it employs at least three people, and passive income stays at or below 50% of revenue. Because of the shareholder rule, it generally does not suit a subsidiary owned by a foreign company.
Rules that catch new investors
- Losses can be carried forward five years, using up to 50% of the loss in a single year, or up to PLN 5 million in one year.
- Debt financing costs are deductible only up to the higher of PLN 3 million or 30% of tax EBITDA.
- Related-party deals must be at arm's length and may need transfer pricing documentation.
- Minimum income tax: since 2024, companies reporting a loss or income below 2% of revenue can owe a minimum tax. Exceptions apply, so check your case.
- Large groups: Poland applies the global minimum tax (Pillar Two) to groups with annual revenue of at least EUR 750 million, from 2025.
Dividends and payments abroad
Poland withholds tax on dividends (19% by default) and on interest, royalties and some services (20% by default) paid to non-residents. Double tax treaties, and EU directives for qualifying parent companies, can reduce or remove the tax, but they come with conditions such as ownership periods and beneficial ownership tests. Poland has a large treaty network, covering over 80 countries.
VAT and e-invoicing (KSeF)
- Rates: 23% standard, 8% and 5% for listed goods and services, and 0% for exports and intra-EU supplies of goods.
- Registration: Polish businesses with annual sales up to PLN 200,000 may use the small-business exemption, but most companies register so they can recover input VAT. Register (form VAT-R) before making taxable sales, and add VAT-UE registration for EU trade.
- Reporting: VAT is reported monthly through the JPK_V7 file, due by the 25th of the following month. Small taxpayers may settle VAT quarterly.
- Split payment: for listed sensitive goods and services, invoices above PLN 15,000 gross must be paid through the split payment mechanism, which sends the VAT to a dedicated account.
- VAT groups are available to related Polish entities.
KSeF e-invoicing is now live. Invoices must be issued in a structured format through the National e-Invoice System.
- From 1 February 2026: taxpayers whose 2024 sales exceeded PLN 200 million.
- From 1 April 2026: all other taxpayers, except the smallest.
- From 1 January 2027: small taxpayers with up to PLN 10,000 of sales per month.
The authorities have signalled a penalty-free transition period until the end of 2026. From 1 January 2027 fines can reach up to 100% of the VAT on an invoice, so make sure your invoicing software is connected in good time.
Personal income tax (PIT)
PIT applies to employees, sole traders and anyone with Polish-source income. Residents, meaning people whose centre of life is in Poland or who spend more than 183 days a year there, are taxed on worldwide income. Non-residents are taxed only on income from Polish sources.
- Progressive scale: 12% up to PLN 120,000 of taxable income and 32% on the excess.
- Tax-free amount: PLN 30,000 a year, which works as a PLN 3,600 reduction of the tax.
- Solidarity levy: an extra 4% on income above PLN 1 million.
- Business owners can choose a 19% flat rate or a lump-sum regime with revenue-based rates of roughly 2% to 17%, depending on the activity.
- Health insurance is a separate 9% contribution. For employees it is not deductible from tax.
- Annual returns for individuals are due by 30 April.
For salaried staff, the employer calculates and withholds monthly PIT advances. See worked examples in the hiring guide, or run your own numbers in the tax calculator. Business owners can also compare the three sole trader tax forms.
Filing calendar for a company with employees
| When | What |
|---|---|
| By the 15th, monthly | ZUS declaration and contributions for a company employer |
| By the 20th, monthly | CIT advance payment, and payroll PIT advances withheld from employees |
| By the 25th, monthly | JPK_V7 VAT return and VAT payment |
| End of January | PIT-4R annual return for employer withholding |
| End of February | PIT-11 statements to employees and the tax office |
| 31 March | Annual CIT return and final CIT payment (calendar-year company) |
| 30 April | Annual PIT returns for individuals |
| Within 6 months of year end | Approve financial statements, then file them to the KRS shortly after |
When a deadline falls on a weekend or public holiday, it moves to the next working day.
Incentives that can lower your bill
- R&D relief: an extra deduction of 100% of qualifying R&D costs, and 200% for the costs of staff hired for R&D.
- IP Box: a 5% rate on income from qualifying intellectual property, such as patents and software copyright, for as long as the protection lasts.
- Polish Investment Zone: a full CIT exemption for 12, 14 or 15 years, depending on location, for qualifying new investments that meet capital expenditure or job creation criteria.
- Robotisation relief: a 50% deduction of robotisation investment costs, available through the end of 2026.
- Prototype and expansion reliefs: additional deductions for trial production costs and for sales and marketing costs.
Each relief has eligibility rules, caps and documentation requirements, so plan them before you spend, not after.
Frequently asked questions
How is a Polish subsidiary's profit taxed when it reaches the foreign parent?
The subsidiary pays CIT on its profit. A later dividend to a foreign parent is subject to 19% withholding tax by default, which may be reduced by a treaty or exempt under the EU parent-subsidiary rules if the conditions are met.
Do I charge Polish VAT to customers in other countries?
It depends on what you sell and to whom. Services to businesses in other countries are generally taxed where the customer is located, often through the reverse charge. Goods and consumer sales follow different rules, so confirm the treatment for each flow.
When do I stop qualifying for the 9% CIT rate?
Small-taxpayer status is based on prior-year revenue, so once revenue passes the EUR 2 million equivalent, the standard 19% rate applies from the following year. A first-year company can use 9% until it passes the limit within that year.
Do I need a Polish tax adviser?
You are not legally required to have one, but a Polish accounting firm normally handles bookkeeping, JPK_V7, payroll and annual returns. For dividends, financing and transfer pricing, take specialist advice early.
This guide gives general information for foreign investors and is not legal or tax advice. Rates, thresholds and deadlines change, so confirm current details with the official sources below or with an adviser. Official sources: podatki.gov.pl, biznes.gov.pl.