A Mazowieckie-based technology company closes its financial year with a small accounting profit – yet its tax advisor flags that it may still owe a separate levy under Poland's minimum corporate income tax rules. The directors are puzzled. They paid CIT. Why does another charge apply?
Poland's minimum corporate income tax (minimalny podatek dochodowy od osób prawnych) targets companies that report low profitability or a tax loss. The charge equals 10% of a specially calculated base, which combines a percentage of revenues with selected cost items. Certain taxpayers are fully exempt, while others must calculate and pay the tax alongside their regular CIT return by the end of the third month after the tax year closes.
This alert explains what changed, which companies fall within scope, which are excluded, and what steps boards and finance teams should take before the filing deadline arrives.
What is the CIT minimum tax and when does it apply?
The minimum tax applies when a company's income from its core operating activity falls below 2% of revenue – or when the company records a tax loss for the year. Both conditions are measured after standard CIT adjustments, not on raw accounting figures. This distinction catches many taxpayers off guard.
The levy was introduced in 2022, suspended for two years, and became fully operative from 1 January 2024. Any company with a tax year ending on or after 31 December 2024 must now assess whether it falls within scope. The first real-money settlements therefore fall due in March or April 2025, depending on the taxpayer's financial year.
The base for the 10% charge has two components. The primary element is 1.5% of operating revenues. To that, the taxpayer adds certain excess costs – particularly related-party financing costs and intangible service fees paid to associated entities. This design means that transfer pricing arrangements and IP Box structures directly affect the minimum tax calculation.
- Profitability threshold: income-to-revenue ratio below 2%
- Alternative trigger: tax loss from operating activity
- Tax rate: 10% of the calculated base
- Filing deadline: end of month three after the tax year closes
A company that qualifies under Polish tax law for the IP Box regime still needs to check whether its overall profitability meets the 2% threshold. IP Box income is ring-fenced for a preferential 5% rate, but the minimum tax calculation looks at the consolidated operating picture. Missing this interaction forfeits a legitimate planning opportunity.
Who is exempt from the minimum tax?
Polish tax law carves out a significant list of exempt entities. Understanding the exclusions is as important as understanding the charge itself. Misclassifying your company as exempt – or failing to claim an exemption you qualify for – both carry real cost.
The following categories are excluded from the minimum tax:
- Companies in their first three years of operation (start-up relief)
- Entities whose revenues fell by at least 30% compared to the prior year
- Simple joint-stock companies (prosta spółka akcyjna, PSA) and certain small taxpayers with revenues below EUR 2m
- Financial institutions supervised by the Polish Financial Supervision Authority (KNF)
- Companies in bankruptcy, restructuring, or liquidation proceedings registered with the National Court Register (KRS)
Family foundations (fundacja rodzinna) established under the 2023 legislation are also outside the minimum tax regime, because they are not CIT taxpayers in the ordinary sense. This distinction matters for ownership structures where operating companies sit beneath a family foundation holding layer. The foundation itself escapes the charge, but its subsidiaries do not automatically inherit that status.
We secured a reclassification of the minimum tax base for a manufacturing client in the Silesia region (autumn 2024), reducing the effective charge by more than PLN 400,000 after correctly applying the revenue-decline exemption that the company's internal team had overlooked.
Board members should also note that the minimum tax interacts with board liability rules. Where a company underpays CIT – including minimum tax – personal liability of directors can follow under the Tax Ordinance. A detailed analysis of board liability for tax arrears is available on our insights page.
What action should affected companies take now?
The immediate priority is a profitability test. Finance teams should run the 2% income-to-revenue calculation on their CIT-adjusted figures – not their management accounts. If the ratio is borderline, a tax advisor Warsaw-based or otherwise should model both outcomes before the return is filed.
Three action items stand out:
- Confirm whether any statutory exemption applies before calculating the base
- Review related-party transactions for transfer pricing add-backs that inflate the minimum tax base
- Check whether KSeF Poland invoicing data has been reconciled with the CIT revenue figure used in the profitability test
KSeF compliance is relevant here for a practical reason. Revenue figures that appear in the structured invoice system (Krajowy System e-Faktur, KSeF) must align with the CIT return. Discrepancies attract scrutiny from the National Revenue Administration (KAS). For companies already working through what KSeF means for cross-border invoicing, the minimum tax adds another layer of data-consistency pressure.
We advised a retail group in the Małopolska region (spring 2025) on restructuring its intercompany service fees. The adjustment brought its minimum tax base down by over PLN 600,000 and simultaneously reduced transfer pricing exposure for the same year.
Companies that miss the filing deadline face a surcharge on the unpaid amount, plus interest accruing from the day after the deadline. The longer the delay, the less room there is to correct errors without penalty. Waiting until the last week of the filing window to begin the calculation is the single most common mistake we see.
Failing to assess minimum tax liability before the return deadline is not a recoverable error. Once the return is filed without the minimum tax and KAS opens an audit, the taxpayer loses the ability to apply certain base-reduction elections that are only available on the original return. That window closes permanently.
To discuss how the minimum tax applies to your company's specific situation, contact info@kordeckipartners.com for a targeted assessment.
Frequently asked questions
Q: Does the minimum tax apply if our company is loss-making because of a one-off write-down?
A: Yes, unless the write-down qualifies as an excluded item under Polish tax law. The profitability test uses CIT-adjusted income, not accounting profit. A one-off impairment that is not deductible for CIT purposes does not reduce the income figure used in the 2% test. You should verify the CIT treatment of each material item before concluding that the loss exemption applies.
Q: How long does it take to calculate and file the minimum tax?
A: For a company with straightforward financials and no related-party transactions, the calculation can be completed in a few days. Where transfer pricing add-backs apply or where an exemption needs to be documented, allow two to three weeks. The filing deadline is the same as the standard CIT return – end of the third month after the tax year closes, typically 31 March for calendar-year taxpayers.
Q: Is it a common misconception that small taxpayers are always exempt?
A: Yes. The small taxpayer threshold (revenue below EUR 2m in the prior year) is one of several exemptions, but it does not cover all low-revenue companies. A company that exceeded the threshold in year one and fell below it in year two must check which year's revenue figure governs. The rules use the prior-year figure, so a company that was large last year is not automatically exempt this year even if revenues collapsed.
KORDECKI & Partners is a law firm based in Warsaw and Krakow, advising business clients across 30 jurisdictions. Our team combines expertise in Polish and international law with a practical approach to corporate tax, minimum CIT compliance, and cross-border structuring. We work with Polish entrepreneurs, foreign investors, and in-house legal teams. To discuss your situation, contact info@kordeckipartners.com.
Disclaimer: This publication is provided for informational purposes only and does not constitute legal advice. The information herein should not be relied upon as a substitute for professional legal counsel tailored to your specific circumstances. KORDECKI & Partners assumes no liability for actions taken or not taken based on the contents of this material. For advice regarding your particular situation, please contact info@kordeckipartners.com.