More changes coming to Polish Deal
19:55
More changes to the Polish Deal are coming for taxpayers starting July 1, including a reduction in the income tax rate, elimination of the middle-class tax credit, and changes to the health premium deduction.
The essential modification is undoubtedly the reduction of the PIT rate from 17% to 12%.
"At this point, it should be emphasized that the new rate will be effective retroactively, i.e., from January 1, 2022. In short, for those taxpayers who settled at the 17 percent rate in the first half of the year, a surplus awaits in income tax for that period," Maciej Blajer from Systim.pl said.
What is important, the change applies not only to taxpayers with employment contracts but also to those with contracts of mandate or contracts for specific work. In addition, the change also applies to entrepreneurs who settle accounts with the tax authorities on general principles. Although the reduced rate will undoubtedly translate into higher remuneration for many taxpayers, the refund of overpaid tax for the year's first half will have to wait.
"This will occur when you file your 2022 annual return. In practice, this means that a sizable portion of taxpayers will not receive their overpaid tax refund until next spring," Blajer added.
Also included in the amendment to the provisions of the Polish Deal was the method of calculating the health contribution. Those who conduct business activity subject to flat-rate or lump-sum tax can deduct health premiums from their income. However, it is worth emphasizing that there will be a limit for this solution, which for "linear" taxpayers will amount to PLN 8,700, while for flat-rate taxpayers – 50 percent of the health premiums will be paid. On the other hand, taxpayers settling their accounts following the general rules will not be able to deduct health contributions in their PIT returns.
(WBJ)
