Key information about taxes in Poland

The Polish tax system offers a variety of incentives and simplifications designed to encourage entrepreneurs to do business in Poland. The following information will help you to understand the opportunities available.

Doing business in Poland

There are many ways to conduct business activity in Poland.

For this purpose, you can use:

• companies (including limited liability companies, limited partnerships and joint-stock companies);
• sole proprietorships.

1. Conducting business activity in the form of a commercial company

If you want to do business in Poland through a company, there are many different types to choose from. These differ in terms of liability, taxes and running costs, among other things. Generally, the greater the level of security provided by a given type of company, the higher the associated costs.

The basic tax for companies is corporate income tax (CIT).

The rates are identical for all types of companies and amount to:

• 5% – on income from intellectual property rights (IP BOX);
• 9% – on other income – for companies with revenues of less than EUR 2 million per
  year;
• 19% – on other income – for other companies.

You can also take advantage of the so-called Estonian CIT, whereby tax is only payable when the company pays out dividends. Until this happens, the company's income is therefore untaxed.

To reduce tax liability, it is possible to take advantage of reliefs such as research and development (R&D), which can be used by entities operating in the new technologies market.

2. Sole proprietorship (JDG)

If you do not want to set up a company, you can run a sole proprietorship (JDG).

This is the simplest and cheapest form of business activity in Poland.

The basic tax for sole proprietorships is personal income tax (PIT).

The tax rates depend on the chosen method of taxation and are as follows:

• Tax scale:
  o Annual income below PLN 30,000: 0%
  o Annual income between PLN 30,001 and PLN 120,000: 12%
  o Annual income over PLN 120,000: 32%.
• Flat tax: 19% of total income.
• Lump sum on income: the rate depends on the type of activity. In the case of IT specialists, it may be 8.5% or 12%.

An additional tax (solidarity tax) of 4% may be paid in cases where income exceeds PLN 1,000,000 per year.

There are also many exemptions and simplifications, i.e.

• the possibility of benefiting from a 5% tax rate on income from intellectual property rights (IP BOX);
• tax exemption for people under 26 years of age on an employment contract up to approx. PLN 85,000 per year
• the possibility of benefiting from the R&D relief, which allows for a reduction in the amount of tax.

3. Social security and health insurance

Social security and health insurance contributions are also an important element of the tax system in Poland.

In 2025, the amounts are as follows (for persons running a sole proprietorship)

• mandatory social security contributions – PLN 1,646.47 per month (regardless of income; this amount increases at the beginning of each year);
• mandatory health insurance contribution – the amount depends on the method of taxation, no more than 9% of income.

Those starting a business can also benefit from simplified social security contribution payments. Depending on how long ago the business was established, the following applies:

• for the first six months: total exemption from social security contributions (PLN 0 per month);
• from the 7th to the 30th month, the amount is PLN 442.90 per month (regardless of income, and this amount increases at the beginning of each year).

4. VAT

Regardless of the type of business (company/sole proprietorship), the vast majority of transactions are also subject to value added tax (VAT).

The basic tax rate is 23%.

In exceptional cases (e.g., the sale of certain food products), reduced rates of 5% and 8% are also applied.

5. Property tax

If you own real estate in Poland, you are obliged to pay property tax.

This is set annually by the local government but cannot exceed the national limit.

In Wrocław, the rates for 2025 are as follows:

• for apartments, the rate is PLN 1.19 per square metre per year;
• for offices, the rate is PLN 34.00 per square metre per year.

Agata Żemełko, Legal Counsel | SDZLEGAL SCHINDHELM