Taxes
As in the European Union, we have many different taxes in Poland. VAT and excise duties are a significant income for the state budget, but they are not a problem for you because you pay them in the price of the products or services you buy.
If you work and earn in Poland, you will be subject to Personal Income Tax (PIT) here.
In general, there are three types of contracts that you can sign when taking up employment in Poland: an employment contract, a contract of mandate and a contract for a piece of work. Students are usually offered piece of work or mandate contracts, especially when it comes to seasonal work.
These agreements are generally taxed more favourably than employment contracts – due to the fact that the regulations in their case determine tax deductible costs more favourably than in the case of employment contracts, the majority of remuneration goes directly to us and not to the tax authorities.
Tax rates: Income from employment contracts, mandate and piece of work contracts are taxed according to the tax scale. |
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The tax-free under 26 | which means that if if you are 26 or younger, your tax in a given year will be zero. |
First tax threshold: | |
annual earnings to PLN 120 000 | is subject to taxation under the first tax threshold - the tax rate is 12%; |
Earnings over PLN 120 000 | fall into the second tax threshold and are taxed at the rate of 32%. |
Depending on the type of contract you have, you may also be covered by compulsory social insurance, but this is deducted by your employer.
It is important that in the case of contracts of employment, mandate or work contracts, the ongoing obligations to settle taxes are not your responsibility, but that of your employer. It is your responsibility to submit an annual tax return, i.e. a PIT document. It should be submitted by 30 April of the following year, i.e. the PIT concerning the income earned in 2010 should be submitted by 30 April 2011. It is filled in on the basis of information provided by your employer(s), so you do not need to collect information about your income on an ongoing basis in order to properly settle with the tax authorities.
If you have a problem with filling out a PIT form, Think Poland employees will be happy to help you.