All foreigners who are officially employed in Poland are ought to pay taxes. In terms of tax law foreigners are divided into two categories:
- Non-residents – i.e. people who do not live on an ongoing basis and have limited tax liability;
- Residents – i.e. people who live on an ongoing basis and have non-limited tax liability.
A Polish tax resident is a subject to the non- limited tax liability and all his income is a subject to taxation, regardless of the place, country and source of their receipt (in accordance with Art. 3 paragraph 1a of the Act dated by July 26, 1991).
A foreigner is considered to be a resident of the Republic of Poland in case Poland is his main resource of economical and life interests or he lives within the territory of the Republic of Poland for more than 183 days in a given tax year. To obtain the status of a tax resident in Poland it is enough to meet at least one of these two criteria.
A resident is taxed under the same conditions as a Polish citizen. Personal Income Contact is calculated depending on the type of income received.
A person who does not reside permanently on the territory of the Republic of Poland is considered to be a non-resident (in accordance with Art. 3 paragraph 2a of the Personal Income Tax Act). It follows that the taxpayer is subject to a tax liability only in relation to income received in the territory of the Republic of Poland (Limited Tax Liability). Income received in Poland from the following sources becomes subject to taxation:
- activities carried out on the territory of Poland on the basis of service, labor and cooperative relations;
- activities carried out personally on the territory of Poland;
- economic activity on the territory of Poland;
- income from real estate located in Poland (relates to sale);
- income from securities admitted to trading on the territory of Poland.
- income from the transferring of ownership of the company's shares or participation in an investment fund registered in Poland.
A non-resident is taxed on a general basis if he receives income on the basis of service and labor relations. In this case, a declaration has to be submitted on the amount of income received in the tax year (PIT-37).
Income from activities carried out personally (artistic, literary, scientific, coaching, educational and journalistic) is subject to taxation at the flat fee of 20%. The employer is obliged to prepare the IFT-1R form and submit it to the tax office with information on the amount of the employee's income.