Poland Introduces a New Corporate Tax System

The coronavirus pandemic has forced various governments to seek more attractive business solutions. In Poland, they decided to support local companies by introducing a new corporate tax policy. In particular, the Polish authorities plan to apply the so-called “Estonian system” for corporations. Previously, Latvia has already taken such a step.

The essence of the “Estonian system” is that taxation of profits is carried out only with payments to shareholders and members. In other cases, income tax is not levied. This should reduce the tax burden on medium-sized businesses, which have suffered most from the financial crisis.

The Polish government also published requirements for legal entities. Companies that have at least 3 employees and whose turnover is at least 50 million zlotys (equivalent to 11.2 million euros) will be able to take advantage of this tax relief. Companies can use such a system for up to 4 years with a possible extension for another 4 years.

Law&Trust offers services for corporate clients working in Poland. Our specialists will tell you in detail what the “Estonian system” is and help prepare documents for participating in the program.