Polish Deal 3.0 | Tax Focus

27 July 2022 | Knowledge, News, Tax Focus

On 28 June 2022, a draft of further amendments to the Personal Income Tax Act and other acts – Polish Deal 3.0 – was published via the Government Legislation Centre website (draft No. UD404).

The most important tax solutions provided for in the draft

CIT & PIT

Modification and deferred application of the minimum income tax regulations

  • The application of the minimum income tax regulations has been suspended until 31 December 2022.
  • The profitability ratio has been increased from 1% to 2%, and the methodology for its calculation has been modified by excluding:
    • from deductible costs – payments under leasing contracts and increases in employment costs and electricity purchase costs compared to the previous tax year;
    • from revenue – the value of trade receivables sold to factoring companies;
    • the value of excise duty.
  • An alternative method of determining the tax base has been introduced, which can be opted for by taxable persons at their own discretion and regards:
    • 4% of revenue – with the tax rate set at 10%, or
    • 2% of revenue + passive costs, i.e. costs of debt financing and intangible services – with the tax rate set at 10%.
  • In addition, the following groups have been excluded from the minimum tax:
    • CIT taxable persons whose annual revenue does not exceed EUR 2,000,000 (i.e. small taxable persons);
    • utility companies;
    • taxable persons with the majority of revenue generated in connection with the provision of health care services;
    • taxable persons whose profitability in one of the last three tax years exceeded 2%;
    • taxable persons that have gone into bankruptcy or liquidation.

Repealing the “hidden dividend” regulations

The “hidden dividend” regulations aimed at countering corporate profit transfers have been repealed following numerous interpretative doubts.

Changes in recognizing debt financing costs as tax deductibles

  • The excess of debt financing costs over the higher of PLN 3,000,000 or 30% of EBITDA obtained by taxable persons being excluded from tax deductible costs has been clarified;
  • In addition, the following types of financing have been excluded from the scope of the regulations limiting the possibility of recognising debt financing costs as tax deductibles:
    • financing granted by banks or cooperative savings and credit unions established in a European Union Member State or in a European Economic Area state;
    • financing for the acquisition or take-up of shares or of all rights and obligations in entities unrelated to a taxable person.

Changes in profit shifting taxation rules

A number of changes have been made to the calculation of profit shifting tax, in particular:

  • only tax deductible costs are covered;
  • the condition concerning preferential taxation in a state of residence, management, registration or location of a related party has been simplified, i.e. it has been indicated that taxation at an effective tax rate lower than 14.25% should be applied directly to a related party’s revenue coming from a specific receivable (and not to its entire income),
  • a number of conditions for related parties have been clarified:
    • a related entity for which costs are incurred will not have its registered office or place of management in the Republic of Poland;
    • the condition of 50% of revenue coming from passive receivables has been clarified;
    • it has been clarified that a related entity should transfer at least 10% of its revenue obtained from a Polish company to a different entity.

Changes in the regulations on controlled foreign companies (CFCs)

  • Regulations have been introduced to eliminate double taxation of CFCs in the case of dividend distributions between foreign controlled companies remaining in the same holding structure.
  • The prerequisite concerning a CFC’s high profitability in relation to held assets in the event of potential disposal of assets during the year has been clarified by providing for a more specific manner of calculation of the profitability ratio in the case of such potential disposal.
  • The definition of the term “subsidiary” has been clarified (editorial/complementary change).

Changes in the regulations on Polish holding companies (PHCs)

  • The condition of not benefiting from so-called participation exemptions, i.e. tax exemptions under Articles 20(3) and 22(4) of the CIT Act, has been deleted from the definition of a holding company;
  • The definition of a subsidiary no longer includes the condition of not:
    • holding more than 5% of shares in other companies;
    • holding all rights and obligations in a company that is not a legal person;
    • benefiting from the exemption under Article 17(1) (34) or (34a) of the CIT Act, i.e. within a special economic zone or the Polish Investment Zone;
  • The income tax exemption of 95% of dividends received by holding companies has been replaced by the full CIT exemption.

Clarification of the regulations concerning the loss relief procedure for companies forming tax capital groups (TCGs)

It has been confirmed that the amended loss relief rules will apply to losses arising from the tax year beginning after 31 December 2021.

Changes in the regulations on lump tax on company income, i.e. Estonian tax

  • The regulations on the manner of determining income from non-business expenses in the case of using assets exclusively for business purposes and in the case of using assets also for other non-business purposes have been clarified.
  • The regulations on the deadline for taxable persons to submit a notification of opting for lump tax on company income (ZAW-RD) have been clarified, allowing for choosing lump taxation prior to the end of the tax year.
  • It has been confirmed that a tax liability under a so-called preliminary adjustment also expires in full after at least one full lump taxation period, i.e. four tax years.
  • It has been confirmed that the deadline for filing a return and paying the tax expires at the end of the third month of the tax year of lump taxation on company income.
  • The tax payment deadline has been extended to the end of the third month of the tax year following the year in which net profit / loss is distributed / covered, an advance payment is made on anticipated dividends or net profit income is distributed after lump taxation ceases.

Change in the rules on relief for initial public offerings (IPOs)

The deductibility from the tax base of expenses for making an initial public offering has been excluded for taxable persons earning income from qualified intellectual property rights, which is taxed at a preferential rate of 5%.

Change in the regulation on the procedure for the refund of tax on revenue from buildings

The obligation to issue a tax refund decision whenever the amount of the refund is not in doubt has been abolished.

WHT

Changes in withholding tax (WHT)

  • The validity of WHT declarations filed by taxpayers has been extended to the end of the tax year.
  • The scope of the subject-matter exemption of non-resident taxable persons from income tax has been extended to include treasury bonds offered on the domestic market and other securities issued by the State Treasury.

How this changes may affect your business? Get in touch with the author

Agata Dziwisz


See other Tax Focus issues

When to file transfer pricing documentation for 2021 | Tax Focus

Latest Knowledge

The new National Cybersecurity System

The amendment to the Act on the National Cybersecurity System (UKSC) is one of the most significant regulatory reforms in recent years. Its main objective is to align Polish law with Directive (EU) 2022/2555 of the European Parliament and of the Council. The directive, also known as NIS2, substantially raises digital security requirements across the Union. The Polish Act on the National Cybersecurity System has undergone a thorough overhaul, covering more organisations (with estimates suggesting nearly 40,000 entities), introducing more demanding obligations, statutory personal liability for management board members, and even more stringent rules for imposing financial penalties. In the case of the most serious violations, these penalties can reach 100 million PLN.

‘Made in Europe’ is no longer just a slogan. It is becoming law

Until recently, ‘Made in Europe’ was just a label. While it was useful for marketing purposes, it lacked any hard, normative content. This may soon change. On 4 March, the European Commission published a proposal for the Industrial Accelerator Act, stipulating that, from 2027 onwards, the Union origin of components will be a prerequisite for participating in renewable energy auctions, accessing public funding, and for being eligible to participate in public procurement procedures. The slogan ‘Buy European’ could become a concrete instrument for supporting local production and controlling foreign investment.

Non-obvious cases of transferring an establishment to a new employer

The transfer of all or part of an establishment (zakład pracy) is a special concept in labour law relating to changes in ownership. Put simply, it is the automatic transfer of all the rights and obligations of the employer from one entity to another, without the need for any additional actions or consents from the parties involved. However, this must be preceded by the fulfilment of a range of informing obligations by both the new and former employers. Let’s take a look at what the process should involve.

Protecting yourself against tax risks in the deposit-return system

The deposit-return system has been in place since October 2025, raising significant tax concerns from the outset. Although the regulations came into force, it was unclear for a long time how to apply them in practice. Some of the regulations needed clarification, some solutions were missing and the published explanations did not cover all the key issues. Consequently, the market began to develop its own operating standards.

Banking sector overview | Banking today and tomorrow | March 2026

On 12 February 2026, the Court of Justice of the European Union (CJEU) issued a judgment concerning the use of the WIBOR index in loan agreements. The CJEU judges confirmed that, in consumer cases, courts cannot examine the correctness of the WIBOR calculation. The banks had correctly informed their clients about the reference rate in accordance with national and EU law.

The issue of the National Labour Inspectorate reform has resurfaced

A new draft law proposing changes to the way the National Labour Inspectorate operates has been submitted to the Sejm. During its first reading on 25 February, the draft was not rejected and was therefore referred to the Social Policy and Family Committee for further consideration. Despite the concerns and controversies raised so far, including by businesses, the legislature continues to pursue the thorough modernisation of Poland’s employment model, which involves increased supervision of the labour market and curbing the abuse of civil law contracts. In this article, we will take a look at the proposals included in the new draft and explain what they mean for businesses.

Polish AI boom

According to the latest data, nearly 15,000 companies dealing with artificial intelligence were registered in Poland in 2025.[1] This testifies to an undoubted boom in AI, as well as to the dynamic changes related to the development of this technology. However, amid the rush to implement AI, do companies consider the most important issue: securing the outcomes of their work and protecting themselves against competitors? In this article, we explore this issue and suggest ways to avoid costly problems.

Contact us: