Introduction: Taxation for Digital Specialists in Poland
In this video, I will explain how to choose the best taxation form for specialists in the digital industry in Poland, such as programmers, designers, project managers, copywriters, and other similar professions. We will discuss the pros and cons of each form of taxation and understand the necessary steps to open a sole proprietorship in Poland.
Step 0: Legal Grounds for Opening a Sole Proprietorship in Poland
First and foremost, it is important to understand that you need legal grounds to open a sole proprietorship in Poland. Make sure you have all the necessary documents and reasons. If you’re unsure, feel free to check out our other videos where we go into more detail on this topic. Step zero is confirming that you have legal grounds.
Which Taxation Form to Choose in Poland?
Now that you’ve confirmed your legal grounds, the next question is: which taxation form should you choose in Poland? There are several options, with the most popular being Scale tax, Linear tax, and Reco-out. The analogy with the sole proprietorship in Ukraine is also relevant here, as many specialists in Poland compare the different taxation forms with what they are familiar with.
Reco-out: Turnover-Based Taxation in Poland
Let’s start with Reco-out. This form of taxation in Poland involves paying tax based on turnover. Rates range from 2% to 17%, depending on your profession. For example, if you are a programmer, the tax rate will be 12% of the turnover, which might seem high, given that many expect lower taxes.
For designers, the rate can reach 8.5% of the turnover, which is a more attractive option. It’s important to remember that the government determines your profession based on the activities listed in your documents and invoices. For example, if you are a programmer, your invoice should specify “programming services.” A detailed list of rates for Reco-out can be found in the video description.
Social Contributions in Poland
Additionally, you will need to account for social contributions in Poland under the ZUS system. There are two main types of ZUS contributions: health insurance and pension insurance. In the first six months, many young entrepreneurs can benefit from discounts and not pay the full ZUS, but after that, they will be required to pay the minimum.
A table with the current rates is shown in the video and will also be available in the description.
Linear Tax: Personal Income Tax for Individuals
The next form of taxation we will discuss is the Linear tax. This taxation form allows you not to be limited by the amount of net income, but the tax rate is 19%. Here, you also need to account for ZUS contributions, which are 4.9%.
If you keep records of income and expenses, you can minimize taxation. For example, if you earn more than 120,000 zlotys per year, you will start paying taxes at rates significantly higher than 19%. It is important to understand that these nuances play a critical role in taxation in Poland and require detailed analysis.
Scale: Special Tax Conditions
Scale is the third taxation form in Poland, which provides various tax advantages and benefits. For example, there are non-taxable limits that can reduce your tax liabilities. For income up to 30,000 zlotys per year, no tax will be charged.
If you earn more than this amount, you will pay fixed percentages of profit. It is also worth noting that you can deduct business expenses, which can lead to significant savings.
Conclusion: Choosing a Taxation Form in Poland
When it comes to choosing a taxation form in Poland, it is important to weigh the pros and cons of each option. If you have a small income and no significant expenses, Reco-out may be the most suitable option. However, if you have big income plans and many expenses, you should consider Linear tax or Scale tax.
Whichever path you choose in Poland, be sure to take all legal aspects into account, and don’t hesitate to ask for help. We are ready to assist you in understanding the nuances of taxation, registering a sole proprietorship, and optimizing taxes.
Let us know in the comments which topics interest you, and we will try to cover them in future videos. Thank you for your attention, and see you next time!
