Changes to “Estonian” CIT

The Polish Deal liberalised on 1 January 2022 the rules applicable to taxpayers who account for corporate income tax in the so-called Estonian CIT regime.

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	2021	2022
Form of business	spółka z ograniczoną odpowiedzialnością (limited liability company) spółka akcyjna (joint-stock company)	spółka z ograniczoną odpowiedzialnością (limited liability company) spółka akcyjna (joint-stock company) prosta spółka akcyjna (simple joint-stock company) spółka komandytowa (limited partnership) spółka komandytowo-akcyjna (partnership limited by shares)
Revenue limit	total revenues from business could not exceed 100 million zloty in the previous tax year less than half of the taxpayer’s revenue had to come from passive sources	no more limit on total revenues still less than half of the taxpayer’s revenue has to come from passive sources
Investment expenditure requirement	taxpayers were obliged to incur a certain amount of expenditures for investment purposes	investment expenditures no longer required
Tax rate	15% – small taxpayers 25% – other taxpayers	10% – small taxpayers 20% – other taxpayers

Obligations connected with Estonian CIT which have not changed

Deadline for choosing the Estonian CIT regime

Starting from 2022, the head of your local tax office should be advised of your choice of flat rate tax regime within the following deadlines:

until the end of the first month of the first tax year in which the taxpayer wants to apply flat rate tax;
before the end of the taxpayer’s tax year if the taxpayer closes its books of account and compiles financial statements according to the Polish Accounting Act as of the last day of the month before the first month of flat rate taxation.

Payment of Estonian CIT

The Estonian CIT regime exempts taxpayers from the obligation to pay tax until they make one of the transactions treated as disposal of company profits. Still, be mindful that a number of economic transactions are treated as disposal of profits under the statute, so you should be careful.

If you have any questions about the Estonian CIT regime, please contact Rödl & Partner experts.