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Polish Deal: Estonian CIT – simplifications and changes


by ​Joanna Parysek-Garstecka

25 August 2021


As part of the numerous changes introduced under the Polish Deal, provisions are expected that relax the rules for applying flat tax on income of companies – Estonian CIT which has been in force in the Polish tax law for just one year.

The changes simplify and refine the already applicable regulations. Conditions that taxpayers must meet to apply that form of taxation will also be relaxed.

The bill abandons the necessity to incur capital expenditure for tangible assets specified in the act, i.e. those from groups 3-8 of the Classification of Tangible Assets, and extends the list of entities eligible for Estonian CIT by limited partnerships and partnerships limited by shares.

Furthermore, the cap on income earned by taxpayers subject to flat-rate taxation, which now amounts to PLN 100 million, is planned to be abolished. This will allow the companies which have so far not been able to do so due to excessive revenues, to switch to flat-rate taxation.

In addition, the bill provides for more flexible deadlines for paying tax liabilities in the case of preliminary adjustments, and even lifts the obligation to pay such liabilities in the case of taxpayers that have applied flat-rate taxation of income for more than 4 years. 

The changes are planned to be implemented at the beginning of 2022.


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Katarzyna Judkowiak

Tax adviser (Poland)


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