Poland reduced corporate tax to 9% for small businesses

Poland has reduced the corporate income tax rate to 9% since the beginning of 2019. This is one of the lowest rates in the EU. However, not everyone will be able to claim this indulgence.

The new tax law came into force on January 1, 2019. They lowered the tax rate to 9%. Previously, it was 19%, then 15%. However, it concerns only small companies and Startups.

Thus Poland attracts investors and its own citizens in business. Provided that the company’s income does not exceed 1.2 million euros per year, you can use the reduced rate. Income is calculated in zlotys at the exchange rate set by the Central Bank of Poland against the Euro.

If you start a business, in some cases you may also qualify for a reduced income tax rate in Poland.

The 9% rate applies to all profits except capital gains.

The law also stipulates that the reduced rate IS not used if:

  • We are talking about divided companies.
  • We are talking about taxpayers who have made a contribution to another object, including the capital.
  • Enterprises previously managed by a person, the organized part of the enterprise or its assets in the amount of more than 10 000 euros in zloty at the exchange rate of the Polish Central Bank.
  • The firm was created as a result of a transformation, merger or division of companies.
  • If an individual who conducted business activities or otherwise engaged in business without the organization of a legal entity transformed into a company.
  • Legal entities and individuals, organized units without legal personality have contributed to the taxpayer’s capital, which previously belonged to the enterprise (part of the enterprise or assets worth more than 10.000 euros).
  • Legal and natural persons, organized units without legal personality, who contributed to the capital of the company received during the liquidation of other companies if these persons or units were the owners of shares.

These and other companies that do not fall under the definition of a small company (with an income of more than 1.2 million euros) are taxed at a tax rate of 19%.

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