Working in Poland?
Poland’s Business World
Taxation in Poland
Citizens and residents in Poland are required to pay income tax. Once you have lived in Poland for more than 183 days within the tax year, you are considered a fiscal resident and taxed on your global income. If that’s not the case for you, you will only be taxed on your Polish income. In any case, the taxes will be deducted from your monthly salary. If you work in Poland as a representative of a foreign company, you may be subject to tax exemptions. The top personal income rate in 2018 was levied at above 85,528 PLN per year, amounting to 32% of your salary.
One-off earnings, such as dividends, are taxed separately. Poland has signed more than 60 tax treaties with other countries, including Germany, the USA, and UK. You can check if such a treaty exists for your country on the finance website of the Polish government.
The Polish Social Security System
Just like every Polish citizen, you are obligated to contribute to the local social security system while working in Poland. The country’s social security system covers sickness, disability, old age, and accident insurance. With your contributions you qualify to receive the same benefits as Polish nationals. According to the social security scheme in Poland, employees and employers contribute to the following amount of their salary to the social security system (as of 2017):
- 9.76% each to old age pension
- 1.5% to survivors and disability pension schemes to be paid by employees, 6.50% to be paid by employers
- 2.45% to sickness and maternity benefits funds (contributions are made by the employee only; not to be confused with the national health fund)
- 2.95% to 6.15% to accident and labor funds (employer only)
In case of sickness, you should receive 80% of your average income for the first 33 days of sick leave in a calendar year (14 days for those aged 50 or older). This will be paid by your employer. After this, the employee receives a sickness allowance at the same rate of 80% for each day of absence, in some cases 100%, to be paid by the social security system.
The total length of parental leave in Poland is 32 weeks for the birth of one child (more in the event of multiple births). The parental leave follows a 20-week basic maternity leave and may be taken by either parent. Depending on which payment plan you choose, you may receive a combination of 100% of your average income for six weeks and 60% for 26 weeks, or 80% of your average income for the full duration.
If you are a national of another EU member country, you may still be able to contribute to the social security scheme and still receive social security benefits in Poland.
Building a Relationship with Your Business Partners
Initial contact with your Polish business partners might be rather formal and quite distanced. Of course, the level of formality will depend on the people you do business with. Some may consciously adopt formal manners while others make a point of doing away with them and adopting a more casual way of interacting with you.
For example, government officials tend to adopt more formal manners than most entrepreneurs, who are in favor of a more casual approach to business. Either way, titles are considered prestigious and impressive, so make sure to always address your business partners by their academic or professional titles as a sign of respect. Equally be sure to include your own titles on your business cards.
Once you begin your negotiations with your Polish business partners, you will realize that communication is incredibly direct. Poles tend to be straight-talking but at the same time somewhat sensitive. You need to be able to walk this fine line between directness and diplomacy. Particularly at the beginning of a business relationship, you need to be careful when communicating your thoughts. People will take their time closing a business deal with you until they have gotten to know you and can be sure that you are a trustworthy individual. It is therefore important to build personal relationships with your business partners and gain their trust.
On a final note, be sure to avoid shaking hands with a business partner in a doorway. In Poland this is considered to bring bad luck.
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