Tax settlement for migrants in Poland depends on their tax residency status. Polish residents pay taxes on their global income, while non-residents only on income earned in Poland. Income is earnings after deducting costs, while revenue is earnings before costs.
The duty to settle tax for migrants should first be examined from the perspective of their tax residency, i.e., the legal status determining in which country an individual or legal entity is obligated to pay taxes based on the place of residence, permanent stay, or other criteria. It is necessary to determine whether the individual has the status of a Polish resident or non-resident.
Individuals, if they have a residence in the territory of Poland, are subject to the tax obligation on their entire income (revenue) regardless of the location of the income sources. This is known as unlimited tax liability (Article 3 paragraph 1 of the PIT Act). Individuals who do not have a residence in the territory of the Republic of Poland are subject to tax only on income (revenue) earned in Poland – this is known as limited tax liability (Article 3 paragraph 2a of the PIT Act).
Important! The difference between income and revenue is that income is the amount of money remaining after all costs are deducted from the revenue, while revenue is the total amount of money earned before deducting costs.
HOW TO DETERMINE IF I AM A POLISH TAX RESIDENT?
To determine if you are a Polish tax resident, first check if there is a double taxation avoidance agreement between Poland and your country of origin. The list can be found on the website.
According to the wording of a typical international agreement, the place of residence (residency) of an individual is the country where they have their center of life interests. The duration of stay in a particular country is considered next, and finally, residency is determined by citizenship.
However, if no international agreement has been made with your country of origin, tax residency is determined as follows. An individual is considered to have a residence in the territory of the Republic of Poland if they:
have a center of personal or economic interests (life interest center) in the territory of the Republic of Poland, or stay in the territory of the Republic of Poland for more than 183 days in a tax year.
If you permanently live in Poland with the intention of permanent stay and your center of life interests is here (you have family here, friends, you work here, etc.), you will be treated by the Polish tax authorities as a Polish resident subject to unlimited tax liability. This means that in Poland – as your country of residency – you settle both income earned in Poland and abroad.
If, on the other hand, your center of life interests is in another country, under Polish law you have the status of a non-resident, which means that in Poland you only settle the income that you earned in Poland.
DO I NEED TO FILE AN ANNUAL TAX RETURN IF I HAD NO INCOME?
As a rule, you must file an annual tax return if you had income during the year. However, it should be emphasized that some incomes are statutorily exempt from tax. Such an exemption must directly arise from the content of the law and is granted by law.
Therefore, you are not obliged to file an annual tax return if you had no income in the tax year or if the income was exempt from tax. For example, according to Article 21(1)(79) of the PIT Act, social assistance benefits are tax-free, and in this regard, there is no obligation to report tax-exempt income in the annual PIT return.
WHAT IF I RECEIVED INCOME?
However, you are obliged to file an annual PIT tax return if you earned income in Poland, for example, from an employment contract or a mandate contract. In such a case, first, you should receive PIT-11 information from your employer/principal. Remember that even if your earnings fall within the annual tax-free amount (30,000 PLN), you are still obliged to file an annual return with “zero” tax. The PIT-11 information is the basis for the annual settlement through the PIT-37 declaration.
WHAT IS THE DEADLINE FOR FILING THE TAX RETURN?
Remember that the deadline for filing the annual tax return is April 30th of the year following the tax year. Additionally, the current regulations allow for automatic settlement with the tax office.
According to Article 45cd of the PIT Act, from February 15th of the year following the tax year, the tax authority provides taxpayers, except for those who are enterprises in inheritance, with tax declarations through their account in the e-Tax Office.
Acceptance by the taxpayer of the declaration provided on the e-Urząd Skarbowy account before April 30th of the year following the tax year means the filing of the declaration or information on the day of acceptance. However, if the acceptance is not made before the deadline for its submission, it means the filing of the provided declaration on the last day of this term (automatic acceptance).
It is worth remembering that access to the e-Urząd Skarbowy account and the possibility of automatic tax settlement are available to taxpayers with a PESEL number. Since June 1, 2021, migrants can apply for a PESEL number for tax purposes. However, as indicated by the Director of the Tax Chamber in Poznań in the interpretation of March 30, 2015, No. ILPB1/415-1461/14-2/AG, in the case of taxpayers who do not have a NIP or PESEL, when submitting a tax declaration, the field for the tax identifier should contain the digits: “9999999999”, and this can be done through the account in the e-Urząd Skarbowy.