Personal Income Tax (PIT) in Poland
Scope of application
Polish residents are subject to personal income in Poland on their worldwide income. Non-residents are taxed only on income earned in Poland.
As a general rule, a Polish resident is a person who :
- has his/her center of personal interests or economic interests (center of vital interests) in Poland; or
- has spent more than 183 days in Poland during the tax year.
Calculation and payment of PIT in Poland
The taxable base includes all incomes, i.e., salaries, bonuses, and income from the rental of movable or immovable property; etc.
Income must be declared annually, and tax must be paid by 30 April of the following year.
Some important differences with France:
- Married couples can choose to be taxed individually
- For employees, the employer withholds the monthly PIT due by the employee; the latter then only must make an annual adjustment. .
PIT rates for 2022
For 2022, following major tax reforms, the PIT tax rate will be significantly reduced:
- the tax-free amount is set at PLN 30,000 (about EUR 6,600) per year which means that taxpayers’ income will in principle only be taxed above this sum,
- individual entrepreneurs who have chosen to be taxed at the linear rate of 19% will not benefit from this tax allowance,
- the first tax bracket will be reduced from 17% to 12% (from the 1st of July 2022),
- the second tax bracket (32%) will be applied above PLN 120,000 annual income (about EUR 26,700), compared to PLN 85,528 in 2021 (about EUR 19,000).
The progressive scale applicable to income received from the 1st of January 2022 will therefore be as follows:
- doctors, dentists, nurses, and midwives will decrease from 17% to 14%,
- informaticians will decrease from 15% to 12%,
- engineers and architects will decrease from 17-15% to 14%.
In return for the reduction in PIT, health insurance contributions will no longer be deductible from taxable income (which, in practice, will result in a 7.75% increase in the tax base for all taxpayers).
Reminder: Personal Income Tax rate in 2021
In addition, employees may could have deducted income-related expenses lump sum of PLN 3,000 or PLN 3,600 (i.e., those whose home is far from their place of work) from their taxable income.
Finally, persons perceiving income from a non-agricultural sole proprietorship could have chosen to be taxed at a linear rate of 19 %.