Lower PIT: PIT tax reduction from 18 to 17 percent

From October 1, 2019, the lower – 17 percent PIT rate will apply. Revenue costs for employees will more than double.

PIT rate 2019 reduction  – who will benefit

The new, lower Personal Income Tax rate will apply to all taxpayers who earn taxable income on general principles using a tax scale (with income up to PLN 85,528 per year). With a minimum wage (in 2019 – PLN 2,250 per month), the annual profit will be PLN 472. People with an average monthly salary (forecast in 2019 is PLN 4,765) will gain PLN 732 a year.

The reduction will apply to revenues obtained from various activities, among others:

• from employment relationship
• from retirement and disability pensions
• from business operations of natural persons
• from property rights
• from activities carried out in person – including commission contracts and specific work contracts.

Higher tax deductible costs

The rules on tax deductible costs will also change. From October 1st they will be as follows:

• PLN 3,000 a year for people working full-time, local (current tax deductible cost: PLN 1,355)
• PLN 3,600 a year for people working full-time, commuters (current tax deductible cost: PLN 1,688.72)
• PLN 4,500 annually for people employed full-time, local (current tax deductible cost: PLN 2002.05)
• PLN 5400 per year for persons employed on several full-time commuters (current tax deductible cost: PLN 2502.56).

What does PIT reduction mean for employers

Reducing taxes and increasing tax deductible costs for employees will significantly reduce labor costs – the employer’s costs related to remuneration.