- 30 August 2021
- Posted by: Przemysław Bukowski
- Category: News
A tax resident of a given country is a natural person who pays taxes on his income to the budget of that state. Consequently, a tax resident in Poland pays taxes in Poland.
To be considered a tax resident in Poland, one of the following conditions must be met:
- In Poland, it is necessary to have a documented business or residence address. For example, to run a business in the country, you need a source of income – work, own real estate, investments or have close family members living in Poland.
- Stay on the territory of Poland for at least 183 days a year (the stay may be uninterrupted or may last for several visits). In the case of staying in the territory of Poland for less than this period, the criteria do not apply.
Persons meeting these conditions will be considered tax residents of Poland. They must receive a PIT-11 form from the employer with the income from the previous year.
Tax resident certificate
Certificate of Tax Residence (CFR1) is a certificate that officially confirms the existence of a tax link between a citizen – individual entrepreneur – legal entity and the state.
To obtain this certificate, please contact the Tax Office at the place of registration.
After submitting the application on the CFR-1 form and paying the certificate fee in the amount of PLN 17, after 7 working days you will receive a certificate of tax residence in Poland. This certificate is valid for 12 months from the date of issue.
Form CFR-1 can be obtained from the tax office or downloaded and printed from the website of the tax office.
This form contains all the necessary identifying information, such as where you live, etc., as well as information on where you intend to submit it.
After receiving the certificate, the original or a notarized copy must be handed over to the employer.
IMPORTANT! To obtain this certificate, you must have a PESEL or NIP number.
What is the tax resident certificate for?
This certificate is necessary above all to avoid the payment of double taxation (in your country and in the country of residence, in this case Poland).
If a taxpayer is considered to be a tax resident of another country (after meeting the necessary criteria provided for in the domestic tax regulations of that country) and at the same time is considered a tax resident in Poland, then under the provisions on personal income tax, he is subject to double taxation. If you use the agreement on avoidance of double taxation – NTC (provided that the agreement is signed between Poland and its country), you will be able to take advantage of the benefits provided for in this case. Such a person will pay taxes in a country with which he has stronger economic ties, that is, where he is in the center of his vital interests. If this cannot be determined, countries will have to resolve the issue by mutual consent.
Deadlines for submitting declarations for tax residents in Poland
The end of the tax year in Poland is December 31st. Tax residents in Poland must report their income for the previous tax year by April 30. In Poland, there is a system of monthly tax payments. Therefore, the Polish tax system requires 11 monthly tax advances. Advance payment for the month of December is paid after submitting the annual tax return. It is not required to submit a tax return during the tax year, it is important that you have time to file it by April 30 of the following year.
If natural persons work in Poland as employees of a foreign company, the foreign employer is not obliged to pay taxes. Employees have to pay the tax withholding themselves on time, i.e. by the 20th of each month following the month in which the income was earned.
If non-residents work under an employment contract with a Polish company and work in Poland, the employer (taxpayer) charges tax at a progressive rate from 17% to 32%, depending on the amount of income. Tax withheld by the employer must be paid to the tax office by the 20th day of the month following the month in which the tax was withheld. Residents are required to declare their worldwide income on their annual tax return, subject to applicable double tax treaties.
Thus, all foreigners living and working in Poland must compare the criteria of tax residence, and if they have the status of “tax resident”, it is necessary to report their income by April 30 of the given year after the reporting year.
IMPORTANT! In the event of non-disclosure or concealment of income, income, to be determined by the Polish tax authority, may be subject to penalties amounting to 75% of the total amount.
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