How does income tax work for foreigners in Poland?
Poland has become an increasingly popular destination for foreign workers, thanks to its growing economy, central European location, and relatively low cost of living. However, if you're planning to live and work in Poland, it's important to understand how income tax applies to foreigners. In this guide, we’ll break down the Polish income tax system, tax residency rules, tax rates, and filing obligations that foreigners should be aware of.
1. Tax Residency: Who Is Considered a Tax Resident in Poland?
Whether you're considered a Polish tax resident or non-resident determines how you're taxed.
You are a Polish tax resident if:
- You spend more than 183 days in Poland in a calendar year, or
- You have your center of personal or economic interests (known as "center of vital interests") in Poland
If either condition is met, you're subject to unlimited tax liability—which means you must pay Polish tax on your worldwide income.
If you do not meet these conditions, you are considered a non-resident and have limited tax liability, meaning you are taxed only on income earned in Poland.
2. Personal Income Tax Rates in Poland (2025)
Poland uses a progressive income tax system for individuals. As of 2025, the tax rates are:
- 12% on annual income up to 120,000 PLN
- 32% on income exceeding 120,000 PLN
There is also a tax-free allowance:
- Individuals with income under 30,000 PLN/year do not pay personal income tax.
For higher earners:
- Income up to 120,000 PLN is taxed at 12%
- The portion above 120,000 PLN is taxed at 32%
Example:
If a foreigner earns 150,000 PLN in Poland in one year:
- The first 120,000 PLN is taxed at 12% = 14,400 PLN
- The remaining 30,000 PLN is taxed at 32% = 9,600 PLN
- Total income tax = 24,000 PLN (approx.)
3. Other Tax Components
Besides the income tax rate, there are other contributions that reduce your net salary:
Social Security Contributions
Employees working in Poland (including foreigners on local contracts) are required to contribute to:
- Pension insurance (emerytalne)
- Disability insurance (rentowe)
- Sickness insurance (chorobowe)
- Health insurance (ubezpieczenie zdrowotne)
These contributions are automatically deducted by the employer from your gross salary.
Solidarity Tax
Individuals whose annual income exceeds 1 million PLN are subject to an additional 4% solidarity surcharge.
4. Double Taxation Treaties
Poland has signed double taxation agreements (DTAs) with over 80 countries to avoid taxing the same income twice. If you are a tax resident in one of those countries, you may be eligible to offset taxes paid in Poland against your home country tax obligations.
You’ll typically need:
- A certificate of tax residency from your home country
- Proper documentation of income and taxes paid in Poland
Always consult a tax advisor to determine how a specific DTA applies to your situation.
5. Income Tax Filing in Poland
Most employees in Poland (including foreigners) have taxes automatically withheld and reported by their employer. However, you may still need to submit an annual tax return:
- Form PIT-37 is the standard return for employees
- Tax year in Poland runs from January 1 to December 31
- Tax returns must be submitted by April 30 of the following year
- You can file your return online using the Polish government’s e-PIT system
6. Tax Identification Number (NIP or PESEL)
To work and pay taxes in Poland, you need a Tax Identification Number:
- If you are a foreigner with residency, you’ll typically be assigned a PESEL number (used for both tax and social services)
- If you do not have a PESEL, you must apply for a NIP number from the tax office
This number is essential for tax filing, social contributions, and legal employment.
7. Special Cases: Foreign Contractors and Remote Workers
If you're working remotely from Poland for a foreign company or are self-employed, your situation may differ:
- You may need to register as a sole trader (działalność gospodarcza) and pay your own taxes and social contributions
- Your income may still be taxed in Poland depending on your residency status and the location of economic activity
Digital nomads and freelancers should seek personalized tax advice.
Final Thoughts
Understanding how income tax works in Poland is crucial for avoiding legal issues, managing your finances, and optimizing your tax obligations. The key is determining your tax residency status and ensuring you are complying with both Polish law and any tax treaties with your home country.
If you're unsure about your specific tax obligations, it's always advisable to consult a qualified tax advisor in Poland—especially during your first year of work.
