Poland: Tax relief on employees under the age of 26 as of 1 August 2019

January 8, 2019

As of the 1st August 2019, employees (Polish citizens and foreign nationals) under the age of 26 are no longer obliged to pay income tax, a decrease from a rate of 18%, provided the employee in question is employed on the basis of an employment contract (fixed or part time) or ‘contract of mandate’- this therefore excludes employees that are employed on the basis of a task-specific contract or self-employed. A contract of mandate has more flexibility than an employment contract, such as the freedom to shape the contents of the contract and to choose the date and place the work is completed.

The introduction of this relief is part of the Polish government’s mission aimed at providing an easier start at the labour market for young adults and attracting / retaining young talent, as currently many young adults are immigrating to other countries in the European Union.

Maximum tax bracket for the relief

The maximum sum of non-taxed income to qualify for this new relief is 85, 528 PLN per annum, the equivalent to £18,037.86 GBP per annum. Therefore, if an individual earns above this bracket, they need to pay income tax on the proportion of income above this maximum amount.

Employer obligations

In order to be compliant with these changes, the employer is should:

Further Information

For further information or to discuss any of the issues raised, please contact Agnieszka Fedor on +48 22 608 7150 at Sołtysiński Kawecki & Szlęzak – www.skslegal.pl.


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