attorney Igor Bąkowski
Bakowski Law Firm, Warsaw, Poland
Tax rates
Rates of Corporate Income Tax (CIT) in Poland | |
Rate | Income |
19% | The default general CIT rate in Poland |
9% | This rate applies to taxpayers whose income (other than from capital gains) earned in a tax year did not exceed an amount denominated in PLN being the equivalent of EUR 2 million if they have the status of a “small taxpayer”. The condition of having a small taxpayer status does not apply to taxpayers commencing the business activity, in the year of the commencement of such activity. This means that a taxpayer commencing activity can use a 9% Corporate Income Tax rate until his income exceeds the 2 million EUR revenue threshold in the first tax year (and in the following tax years, when the revenues from the tax years preceding will not exceed EUR 2 million in a given tax rear). |
19% | On dividends and other income from participation in profits of legal persons having their registered office or management board in Poland |
19% | On the income of a controlled foreign company (CFC) obtained by a taxpayer having its registered office or management board in Poland |
19% | From income from unrealized gains |
19% | From the income obtained from the paid sale of virtual currencies |
19% | From the income of a “real estate company” (as defined in the tax law, generally a company whose main object of activity is real estate) whose shares, all rights and obligations, participation titles or rights of a similar nature are transferred |
5% | From the qualified income obtained by the taxpayer from qualified intellectual property rights (IP BOX) |
Value Added Tax (VAT) rates in Poland | |
Rate | Goods / services |
23% | The standard VAT rate |
8% | For certain food products and beverages not covered by other rates, new housing structures and housing construction services covered by the social housing program, passenger transport and restaurant services |
5% | For certain food products, including unprocessed food, and certain beverages (spice plants, fish, meat, dairy products, bread, confectionery, eggs, juices), books printed or published on disc or tape. |
0% | For exports of goods to countries outside the European Union. |
exempt | Certain financial, insurance, and educational services are exempt from VAT tax. |
Excise duty
Excise duty (“akcyza”) is levied in Poland on the production, sale, import, and intra-Community acquisition of ‘excise goods’, which are listed in the excise duty law and include (among others) the following goods:
- energy products;
- electricity;
- alcoholic beverages;
- tobacco products;
Depending on the goods in question, different methods of calculating excise tax are applicable:
- A percentage of the taxable base;
- An amount per unit;
- A percentage of the maximum retail price;
- An amount per unit and a percentage of the maximum retail price.
The excise rate for car petrol is PLN 1.529 per 1.000 litres.
Passenger cars are subject to the following excise rates:
- 1% for cars with engine cubic capacity that does not exceed 2.000 cc;
- 6% for cars with engine cubic capacity that exceeds 2.000 cc.
Polish excise duty law provides for a wide system of excise duty exemptions as well as 0% taxation. Under specified circumstances, such preferential treatment may apply to specified goods that are otherwise taxed based on general rules. This concerns, mostly, specific energy products used for other purposes than as a fuel or for heating.
There is also an excise duty placed on coal. Depending on the product, the excise duty rates for energy products are for coal and coke intended for heating purposes. The rates are PLN 32,84 per 1.000 kg of coal, PLN 11,87 per 1.000 kg of lignite, and PLN 37,95 per 1.000 kg of coke. In practice, there are a wide range of excise duty exemptions (Poland has used almost all the exemption options provided in the EU Directive); nevertheless, many new administrative obligations have been set for entities producing, distributing, and using coal. The fulfilment of those obligations is necessary in order to apply an excise duty exemption.
On 1 February 2021, the Central Register of Excise Entities was launched. Information on the use of excise goods by entities from all over the country is collected in the Register.
Property taxes
Pursuant to the Act on local taxes and charges, municipalities have the right to fix tax rates (up to the maximum levels per sqm. established yearly by the parliament) and establish the above-mentioned exemptions from taxes and charges.
Property tax is imposed on:
- Buildings or parts of buildings – taxed on usable area;
- Structures or parts of structures used for an economic activity – taxed on initial value adopted for tax purposes, not reduced by depreciation write-offs;
- Land (if not subject to the farming tax) – taxed on area;
Property tax rates with regard to buildings and land are established on a yearly basis by municipalities within limits set in the Act on local taxes and charges – the limits (maximum rates) for 2023 are:
- for land used for business purposes is subject to a rate limit of PLN 1,16 per square meter;
- for buildings used for business purposes are subject to a rate limit of PLN 28,78 per square meter;
Property tax rate for structures is fixed at 2% of the initial value.
Real estate tax payers
Real estate tax payers are natural persons, legal persons, organizational entities which are owners or autonomous possessors of real estate or civil structures, perpetual usufructuaries or owners of State-owned real estate or parts thereof or civil structures or parts of civil structures belonging to the State or a local authority, if ownership results from an agreement concluded with the owner, Agricultural Property Agency or under a different legal title, and also without a legal title.
Legal persons submit tax returns indicating the taxed properties, their area or value for a given tax year by January 31 to the local authority competent for the location of the objects of taxation. The tax should be paid in monthly instalments by the 15th day of each month (with exception for the first instalment in a given year by 31 January).
Civil law transactions tax (“PCC”) (transfer tax)
A civil law transactions tax (“PCC”) applies to certain civil law transactions such as sale or loan, determined as a percentage of the transaction value.
Sale and exchange are taxed at 1% (property rights) or at 2% (tangibles and real estate), with the market value being the tax basis. Loans are taxed at 0,5%.
The law provides a number of exemptions, including an exemption for transactions that are subject to VAT or where at least one of the parties of the transaction is exempt from VAT.
This exemption is not applicable to VAT-exempt transactions on shares or real estate.
Capital tax
A share capital increase in case of limited liability companies and joint-stock companies is subject to a 0.5% civil law transactions tax, payable by a company or partnership that receives a capital contribution.
A merger, division, or transformation of a corporation into another corporation is not subject to capital tax, even if the transaction results in a share capital increase.
A similar exemption applies to a capital increase resulting from an in-kind contribution of an enterprise or its organized part or a qualified share-for-share exchange concerning corporations.
Stamp duty
In Poland, some activities are charged a stamp duty. Payment is required, for example, in connection with the submission of a power of attorney, after completion of an official act, or the issue of a certificate or permit. The most common amount of stamp duty, for example for powers of attorney, is marginal (PLN 17).
For more information please contact
attorney Igor Bąkowski
tel. +48 22 633 67 66
or other lawyers from Bakowski Law Firm
bakowski.net.pl