Donating 1.5% of Tax to Public Benefit Organizations in Poland

Polish taxpayers now have the option to donate 1.5% of their tax to (PBOs) Public Benefit Organization in Poland, instead of just 1%. This change was introduced in 2022 as part of the Polish Order. Donating 1.5% costs nothing and does not burden taxpayers in any way, but it provides crucial financial support to PBOs.

The Legal Framework for Public Benefit Organizations in Poland:

In legal terms, 1.5% of tax is funds that belong to the tax office. If this amount is not transferred to a PBO, taxpayers will have to give it back anyway, and the tax office will receive it. By donating 1.5% of their tax to PBOs during PIT (Personal Income Tax) settlement, taxpayers are not losing anything, but rather sharing the money that would have gone to the tax office.

It is important to note that the transfer of 1.5% of tax is not considered a donation and cannot be deducted from income. However, it greatly benefits PBOs and supports their activities.

Donating 1.5% of the tax to Public Benefit Organizations in Poland is easy and can be done regardless of the method of settlement with the tax office. Taxpayers can perform this action manually by entering the number of PBOs (Public Benefit Organizations in Poland) in the National Court Register and the amount to be transferred in the appropriate PIT field. Alternatively, they can use a free tool such as the PIT program or the e-service Your e-PIT.

In summary, donating 1.5% of the tax to PBOs in Poland is a simple and effective way to support important causes without any additional burden on taxpayers.

What This Means for Businesses in Poland

Tax policy changes in Poland have direct implications for both domestic and foreign-owned businesses. Companies operating in Poland must stay informed about regulatory developments to optimize their tax position and maintain compliance. The Polish tax system includes CIT (19% standard, 9% for small taxpayers), VAT (23% standard rate with reduced rates of 8% and 5%), and various sector-specific levies.

For international entrepreneurs and investors, understanding the Polish tax landscape is essential for business planning. Poland offers several attractive incentives including the Polish Investment Zone (up to 15 years of CIT exemption), R&D tax relief (up to 200% deduction), and the IP Box regime (5% effective CIT rate on qualified intellectual property income). Professional tax advisory can help identify the most beneficial structure for your specific situation.

The interplay between Polish domestic tax law and international tax treaties is particularly important for foreign-owned entities. Transfer pricing regulations, withholding tax provisions, and anti-avoidance rules (GAAR) require careful navigation to ensure both compliance and optimization.

If you are doing business in Poland or considering entering the Polish market, Zalewski Consulting can help. Learn more about our tax advisory services in Poland, or contact us for a free consultation.