What taxes do you pay in Poland?
July 19, 2023
Many people starting a business in Poland, whether as a sole proprietorship or in the form of a company, wonder what taxes they will have to pay. Constantly changing regulations do not make it easier to understand tax obligations. Below we present a short “cheat sheet”, which lists the most important taxes: income tax, VAT, excise duty tax, property tax and tax on means of transport.
Income tax
In Poland, in terms of taxation of income, the tax to be paid depends on the form we have chosen to earn.
A sole proprietorship
If we have decided to run a sole proprietorship then we can choose:
- Taxation based on the Personal Income Tax Act. There are basically two forms to choose from: a tax scale or the so-called flat tax
- Lump sum on registered income
IMPORTANT: from 2022, you can no longer choose to be taxed in the form of a tax card.
A joint-stock company, limited liability company, limited partnership, limited joint-stock partnership or general partnership
If we have decided to run a business in the form of a joint-stock company, limited liability company, limited partnership, limited joint-stock partnership, general partnership (if it is based in Poland and its partners are not only natural persons) – then the taxation will apply provisions of the Act of February 15, 1992 on corporate income tax – CIT
A civil law partnership
A civil law partnership is not a taxpayer on the basis of income taxes, only its partners are subject to taxation.
Commercial property tax
Taxpayers who own the so-called commercial real estate pays commercial property tax..
Important! It should be remembered that in the area of income taxes, entrepreneurs may also be required to pay certain types of special taxes, e.g. withholding tax, in the case of certain types of transactions with entities from abroad.
VAT tax
Taxation on goods and services tax is a rule – which means that every entity conducting business activity, regardless of the chosen form, is obliged to pay such tax.
There are two exceptions to this rule:
- Subjective exemption from VAT – this exemption means that until the threshold specified in the Act is reached, there is no obligation to pay VAT. in 2023 this limit is PLN 200,000. The value of this limit does not include VAT.
- VAT exemptions – the VAT Act provides for a number of VAT exemptions for specific types of transactions. In the catalog of subject exemptions (Article 43 of the VAT Act), we will find, among others, medical services, financial intermediation
Excise tax
Excise tax is paid by entities selling the so-called excise goods, including alcohol, fuels, tobacco products, coal and gas products. Import and intra-Community acquisition of passenger cars are also subject to excise duty. From 2021, those entrepreneurs who have made structural changes to a truck that resulted in its transformation into a passenger car may also be required to pay excise tax.
Property tax
Taxpayers who are owners of land, buildings or structures related to conducting business activity are obliged to pay property tax.
Tax on means of transport
Entities that own trucks with a maximum permissible weight of min. 3.5 tons, tractor units as well as trailers and semi-trailers are required to pay tax on means of transport
Looking for more about company registration in Poland?
Take a look at our articles that are a part of series #StartBusinessInPoland You will find out in them the most useful information about:
- General information about how to start a company in Poland
- What to choose: full or simplified accounting?
- Suspension of business activity in Poland
- Registration for the social and health insurances in Poland
- Costs of setting up and running a business in Poland
Tags excise duty, income tax, income tax in Poland, property tax, tax on means of transport, VAT in Poland, VAT tax, what taxes do you pay in Poland
