Polish Minimum Tax – First Filing Due by March 31, 2025
The deadline for settling the minimum tax for 2024 is fast approaching.
This relatively new measure aims to curb tax optimization practices among taxpayers who regularly report tax losses or demonstrate very low profitability.
Who Is Subject to the Minimum Tax?
The minimum tax applies to CIT taxpayers, including Polish companies and branches of foreign enterprises, who in 2024:
- incurred a tax loss from operational activities, or
- achieved a tax profitability from operational activities (calculated as the ratio of taxable income to taxable revenues) of no more than 2%.
The tax is set at 10% of the tax base. However, the base is calculated through a multi-step process requiring the collection and thorough analysis of various types of data.
Taxpayers also have the option to use a simplified method for determining their tax base, which sets it at 3% of revenues derived from operational activities.
Payment Deadline
The minimum tax must be paid by the deadline for filing the annual tax return. For taxpayers whose fiscal year aligns with the calendar year, this means any minimum tax due must be settled by March 31, 2025.
Exemptions from the Minimum Tax
Certain taxpayers are exempt from this obligation, including:
- new businesses (in their first year of operation and the following two tax years),
- so-called small taxpayers,
- taxpayers whose revenue decreased by at least 30% compared to the previous tax year,
- taxpayers who achieved an income-to-revenue ratio of at least 2% in any of the three tax years directly preceding the tax year for which the minimum tax is due,
- taxpayers undergoing bankruptcy, liquidation, or restructuring proceedings.
Minimum Tax vs. Regular CIT
The minimum tax is separate from the “regular” CIT. However, the regulations provide for the possibility of reducing the minimum tax liability by the amount of CIT owed, ensuring that double taxation does not occur if both the “regular” CIT and the minimum tax are due in the same fiscal year.
Should you have any questions or doubts concerning the Polish minimum tax, please feel free to contact the TIAS Tax Department at office@tias.pl.
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