Zero PIT – who will not benefit from this tax relief?

12.09.2019

Introduced at the beginning of August 2019 PIT 0 is directed to persons, who have not attained the age of 26. However, not all persons who fulfil this condition can benefit from this tax advantage.

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Zero PIT (Personal income tax) tax rate for young employees was entered into force on 1 August 2019. Nevertheless, this exemption from income tax is made conditional upon the form of employment as well as income levels. Who can and who cannot benefit from new income tax exemption?

PIT 0 – who will benefit from it?

Zero PIT tax rate will be applicable only to persons who have not attained the age of 26 and who at the same time:

  • remain in an official relationship
  • remain in an employment relationship
  • are employed on the basis of a mandate contract
  • remain in a cooperative employment relationship
  • remain in an outwork relationship

Who will not benefit from Zero PIT?

Zero PIT tax rate will not be applicable to persons who have not attained the age of 26 and who:

  • are employed on the basis of specific-task contract
  • run their own business activities
  • are employed on the basis of managerial contracts
  • are employed on the basis of training agreements
  • are serving paid practical trainings
  • are employed on the basis of a contact for aid at harvest
  • are employed on the basis of mandate contracts worth less than PLN 200
  • are employed on the basis of mandate contracts and are non-residents

PIT tax exemption does not include:

  • sickness benefits
  • maternity allowances
  • rehabilitation benefits
  • unemployment benefits
  • revenues from intellectual property rights including copyrights
  • maintenance payments for children
  • student grants

Zero PIT tax rate and the income levels

Amendment to the Personal Income Tax Act, which has introduced Zero PIT tax rate, regulates also the limits up to which this tax relief shall be applicable. Thus, the annual income not exceeding the amount of PLN 85 528 shall be exempted from taxation. The only exemption from this rule is the year 2019 in which this tax relief shall be applicable only up to the amount of PLN 35 636,67 and only for the revenues obtained until the date of 1 August 2019.

The Zero tax relief shall not include the following revenues:

  • travel expenses such as daily allowances and other travel costs reimbursements
  • benefits in kind under health and safety regulations
  • revenues from which the collection of taxes has been abandoned pursuant to the provisions of the Tax Ordinance

See also: Zero PIT for employees and service providers under the age of 26

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