Tax Alert AMENDMENTS TO PERSONAL INCOME, TAX FROM JANUARY 1, 2020
Personal Income Tax:
0% PIT for youngsters under 26 years old: Starting from 08/01/2019 youngsters under the age of 26 are exempt from PIT. This however, does not extend to payments made in lieu of remuneration such as sickleave benefits or maternity benefits.
New tax rates:
Starting from 10/1/2019 the lowest tax rate have been decreased from 18% to 17%. The new rate applies to annual income up to PLN 85.528 (for the year 2019, it is applied proportionally). Any surplus over PLN 85.528 continues to be subject to 32%. The new tax rate applies i.a. to employees, management board members and self-employed (who did not choose 19% flat tax rate).
Increased tax deductible costs:
Staring from 10/01/2019 the tax deductible costs for employees and management board members are fixed and they have been raise from PLN 111,25 per month to PLN 250 per month (in certain cases, e.g. if an employee commutes to work to another town, the tax deductible costs have been raised from PLN 139,06 to PLN 300 per month). An annual limit applies.
Tax & financial implications for delayed payments made to your contractors: will be raised from 9,5% to 11,5% (i.e. National Bank of Poland Lombard interest rate + 10%). It is also worth noting that the statutory interest rate in B2B transactions.
Personal & Corporate Income Tax
Starting from 01/01/2020 the debtor will be obliged to increase its taxable base if a payment due is not made within 90 days (counting from the day following the payment date). The taxable base shall be increased in the annual tax return. Creditor, on the other hand, will have a right to decrease its taxable base if a payment is not made by the debtor within 90 days (counting from the day following the payment date). The taxable base can be decreased in the annual tax return. We are at your disposal – we will explain the changes introduced and the possible effect of the new regulations on your company. At the same time, we would like to invite all other taxpayers who already have doubts about the Personal Income Tax amendments. For many years, we have been advising taxpayers and supporting them in conducting their business in Poland and abroad. If you are interested in cooperation, please do not hesitate to contact us.
Download Newsletter w pdf: Tax Alert changes in PIT from January 1 2020.pdf