Changes in PIT taxation of employee incentive programs
Preferential tax treatment applies only to shares in join stock companies, not to shares in limited liability companies and is extended to shares issued by companies seated also outside the European Union or the European Economic Area. This preference applies to taxpayers acquiring shares of companies whose registered office (headquarter) or management board is located in the territory of countries with which Poland has concluded a double tax treaty.
The group of potential beneficiaries is limited to employees or individuals who receive income from civil law contract from activities performed personally. The preferential treatment extends to persons directly entitled to acquire or purchase shares as well as to persons entitled to acquire or purchase shares in exercise of rights arising from securities, derivative financial instruments, or of other rights. Relating to programs based on derivatives, the income from the exercise of rights in securities or derivative financial instruments obtained as a result of the acquisition of these rights as a benefit in kind or unpaid benefit, is recognized as a source of income under which this benefit was obtained.
Changes in taxation of creative activity
The tax-deductible expense cap with respect to copyright disposals is doubled from PLN 42,764 to PLN 85,528 per annum. At the same time, a new regulation is introduced to restrict the number of authors entitled to take advantage of the 50% lump-sum costs. The advantage applies only to those authors, who derive income from certain specific types of activities, including, among others, creative and artistic activities in chosen areas, research and development, academic and scientific activity, audio-visual activity or journalism. The remaining individuals, who benefited from the 50% tax deduction applicable to the part of their remuneration related to creative duties lost this privilege as of 1 January 2018.
Higher limits of tax exemption
Benefits in kind and cash financed from companies’ Social Fund (ZFŚS) are exempt from PIT up to 1,000 PLN (before 380 PLN). Allowances received in connection with individual random incidents, natural disasters, long-term illness or death financed from companies’ Social Fund are exempt without a limit, or from other sources up to PLN 6 000 (before PLN 2 280). Support for organized recreation for children, financed from funds other than the social fund, are exempt up tp 2,000 PLN (before 760 PLN). Winnings in competitions and games as well as prizes related to bonus sales are exempt up to PLN 2 000 (before PLN 760).
New amount of tax-free income
As of 1 January 2018, the tax-free income has been increased to PLN 8 000. At the same time, the new regulation maintained the degressive amount which reduces the tax on the taxable base not exceeding PLN 127 000. The amount of tax reduction depends on taxable base and varies from PLN 1 440 for tax base not exceeding PLN 8 000 to PLN 0 for tax base higher than PLN 127,000.
Changes in lump-sum rental tax
New regulations introduced a new way of lump-sum rental taxation. After exceeding the annual threshold of PLN 100 000 from this source, the 12,5% tax rate applies.
New minimum wage/hourly rate
The minimum wage increased to PLN 2,100 gross and the minimum hourly rate for specific civil law contracts increased to PLN 13,70.
Social security and health insurance payments
Social security, health and Labor Fund/FGSP contributions are paid by one bank transfer to a new bank account. Each payer should receive his own individual bank account number in ZUS.
No trading on Sundays
As of March 1, 2018, shopping will only be allowed on two Sundays per month – the first and last one. As of 2019, this will be further limited to the last Sunday of the month, while as of 2020, shopping will be permitted on seven Sundays per year: the last two Sundays before Christmas, the last Sunday before Easter, as well as the last Sundays of January, April, June and August. There are several exemptions to these restrictions. Thus, Sunday trade will continue as normal in such establishments as bakeries, cake shops, liquid-fuel stations, flower shops, newsagents, post offices, army-unit stores, railway-station and airport shops, duty-free stores and wholesale agriculture markets.
Electronic medical sick leave (ZLA)
Paper medical sick leaves may be issued by the end of June 2018. From 1 July 2018, doctors will only issue electronic ZLA which are available on ZUS portal.
The purpose of our newsletter is to provide general information and to draw the attention to the current changes in law which we believe to be important for the business operation of our clients. It is not a replacement for careful review of the acts and rules and the consultation with your tax advisor.
© Copyright 2017, Process Solutions – All rights reserved.
Process Solutions Sp. z o.o.
ul. Grzybowska 5A, 00-132 Warszawa
+48 22 630 8600