Corporate income tax Poland: New tax for companies in 2024

New minimum corporate income tax legislation came into force in Poland on 1 January 2024. The new tax will be paid by companies with an operating loss (from a source of income other than capital gains), as well as those with low profitability. The Ecovis experts explain the details.

Who is subject to minimum corporate income tax?

The tax applies to Polish tax residents, non-residents conducting business activity through a foreign permanent establishment located in Poland, and tax capital groups which in a given tax year:

• incurred a loss from a source of income other than capital gains, or
• achieved a share of income from a source of income other than capital gains of no more than 2%

The minimum corporate income tax is calculated independently of the regular Polish income tax. The tax result, i.e. the amount of loss or income, is also determined differently.

Minimum tax base

The minimum income tax amounts to 10% of the tax base. The tax base is the sum of an amount corresponding to 1.5% of the value of revenues from a source of income other than capital gains earned by the taxpayer in the tax year and the costs of intangible services incurred directly or indirectly for the benefit of related parties, or from tax havens or the costs of the acquisition of specific services or intangible rights, for the part by which their value exceeds PLN 3 million, and 5% of the tax EBIDTA.

The new minimum income tax is complex and there are some exceptions. We would be happy to advise you.

Tomasz Strzałkowski, Tax advisor, ECOVIS POLAND Audit, Tax & Accounting, Warszawa, Poland

The taxpayer may choose a simplified method of determining the tax base, which is an amount corresponding to 3% of the value of the revenue earned by the taxpayer in the fiscal year from a revenue source other than capital gains.

Who is not be subject to the minimum tax

The act lists a catalogue of taxpayers who will not be subject to the minimum tax. These include, among others, taxpayers:

• in the tax year in which they started their activity and in the consecutive two tax years immediately following that tax year
• who are financial undertakings
• who in a tax year earned revenue at least 30% lower compared to revenue earned in the directly preceding tax year
• whose shareholders, stockholders, or partners are only natural persons and if the taxable person does not hold
  • a) directly or indirectly, more than 5% of:
    • shares (stock) in equity of another company, or
    • all rights and obligations in a company without legal personality
  • b) other property rights related to the right to receive a benefit as a founder or beneficiary of a foundation, trust or another entity or legal relationship of a fiduciary nature
• who are small taxpayers

The first minimum tax settlement will take place in 2025.

For further information please contact:

Tomasz Strzałkowski, Tax advisor, ECOVIS POLAND Audit, Tax & Accounting, Warszawa, Poland
Email: tomasz.strzalkowski@ecovis.pl