A Warsaw-based technology entrepreneur has built a profitable software business over eight years. She now plans to relocate to Portugal and transfer her shareholding to a holding company registered in the Netherlands. Two weeks before the move, her accountant raises a concern: the transfer may trigger Polish exit tax on unrealised gains. The entrepreneur had no idea such a liability existed.

Polish exit tax applies when a taxpayer – individual or corporate – transfers assets, changes tax residency, or moves a business outside Polish tax jurisdiction. The tax is calculated on unrealised capital gains: the difference between the market value of assets at the date of exit and their tax cost basis. For individuals, the rate is 19% on assets worth more than PLN 4 million; for companies, the rate is 19% or 9% depending on the entity's size and asset type.

This guide explains when exit tax is triggered in Poland, how to calculate the liability, which planning strategies are available, and what mistakes to avoid. It covers three business scenarios – a relocating founder, a cross-border restructuring, and a family foundation transfer – and provides a step-by-step compliance checklist.

When is Polish exit tax triggered?

Exit tax catches three distinct events. First, a change of tax residency by an individual or company moving outside Poland. Second, a transfer of assets from a Polish permanent establishment to a foreign head office or branch. Third, a transfer of a business function, risk, or asset that results in Poland losing taxing rights over future income from that asset. Each event requires separate analysis under Polish tax law.

The National Tax Administration (Krajowa Administracja Skarbowa, KAS) monitors residency changes through departure notifications and cross-references data from the National Court Register (Krajowy Rejestr Sądowy, KRS) and the Social Insurance Institution (Zakład Ubezpieczeń Społecznych, ZUS). Gaps in reporting are routinely identified during post-departure audits. KAS has 5 years from the end of the tax year in which the exit occurred to assess additional tax.

For individuals, exit tax applies only when the total market value of assets exceeds PLN 4 million. Below that threshold, no exit tax declaration is required. Above it, the taxpayer must file a declaration within 7 days of the triggering event and pay the tax – or apply for instalment treatment over up to 5 years if relocating to an EU or EEA country.

  • Residency change – individual or company moves outside Poland
  • Asset transfer – assets leave a Polish permanent establishment
  • Function or risk transfer – Poland loses taxing rights over future income
  • In-kind contribution – assets contributed to a foreign entity outside Polish jurisdiction
  • Deemed disposal – certain reorganisations treated as a disposal under income tax rules

One common misconception: exit tax is not a departure tax on the person. It targets the unrealised gain embedded in specific assets. A founder leaving Poland but retaining Polish-source income from retained Polish assets may owe exit tax on the shareholding she takes with her – but not on assets remaining in Polish tax jurisdiction.

How is the exit tax liability calculated?

The calculation has three inputs: market value at exit, tax cost basis, and the applicable rate. Market value is determined as of the date of the triggering event – not the date of filing. For shares in private companies, this typically requires a valuation by a qualified expert. The tax cost basis is the historical acquisition cost, reduced by any depreciation or amortisation already claimed.

We secured a reversal of a KAS exit tax surcharge exceeding PLN 1.8 million for a tech founder relocating from Warsaw to the Netherlands (autumn 2025). The authority had used an inflated valuation based on a comparable-transactions method that did not reflect the company's actual minority discount. Challenging the valuation methodology reduced the assessed gain by over 40%.

The rate structure matters. Individuals pay 19% on unrealised gains from shares, real property rights, and certain financial instruments. Companies pay 19% as a general rule, but smaller entities qualifying under Polish corporate income tax rules may pay 9% on assets below defined thresholds. Transfer pricing rules apply when the exiting entity has related-party relationships – the Ministry of Finance expects arm's-length valuations consistent with OECD guidelines, and KAS cross-checks these against transfer pricing documentation already on file.

One concrete figure: the instalment option for EU/EEA relocations allows the taxpayer to spread payment over 5 years in equal annual instalments. Interest accrues at the standard statutory rate. The instalment application must be filed simultaneously with the exit tax declaration – it cannot be submitted retrospectively.

What planning strategies reduce exit tax exposure?

Planning works best when started at least 12 months before the anticipated exit. Three strategies are most effective in practice. First, restructuring asset ownership before the triggering event so that high-value assets remain in Polish tax jurisdiction. Second, using a family foundation (fundacja rodzinna) to hold assets that would otherwise carry large unrealised gains. Third, timing the exit to coincide with a period when asset values are lower – relevant for companies with cyclical valuations.

The family foundation structure deserves specific attention. Since May 2023, Polish law has allowed founders to transfer assets into a family foundation on a tax-neutral basis, subject to conditions. Assets held inside the foundation are not subject to exit tax on the founder's personal relocation, because the foundation – as a Polish legal entity – retains Polish tax residency. This is a significant planning tool for founders with large shareholdings. Our team has structured eight family foundations since May 2023, several of which involved founders with planned cross-border relocations.

IP Box also interacts with exit planning. A company holding IP assets that qualify for the 5% IP Box rate under Polish income tax rules may face exit tax if those assets are transferred abroad. Pre-exit restructuring to retain the IP in a Polish entity – while licensing it to the foreign group – can preserve the IP Box benefit and eliminate the exit tax trigger on the IP itself. This requires careful coordination between Polish tax law and the applicable double tax treaty.

For cross-border transactions, the double tax treaty between Poland and the relevant destination country is the first document to review. Poland's treaty network covers over 80 countries. Some treaties limit Poland's right to tax exit gains on specific asset classes. The double tax treaty between Poland and the United States contains provisions that affect how gains on US-source assets held by Polish residents are treated on exit – relevant for founders with US equity holdings.

What are the common mistakes and how can you avoid them?

Three mistakes account for most of the exit tax problems we see. Missing the 7-day declaration deadline is the most damaging. The deadline runs from the date of the triggering event – not from the date the taxpayer becomes aware of the liability. Late filing triggers a penalty surcharge of up to 30% of the understated tax, and the late-payment interest compounds daily. Personal liability of directors for corporate exit tax failures is an additional risk that is often overlooked.

We obtained interim protection for a German investor's Polish subsidiary in Lower Silesia (spring 2026) after KAS issued a precautionary enforcement measure during an exit tax audit. The authority alleged that a cross-border merger constituted an asset transfer triggering exit tax. Obtaining the interim measure gave the client time to present a full valuation rebuttal without facing immediate asset seizure.

The second mistake is failing to obtain a contemporaneous valuation. KAS routinely challenges post-hoc valuations prepared after the audit opens. A valuation dated before or on the day of the triggering event carries significantly more evidentiary weight. For real property rights, the Polish valuation must be prepared by a certified property appraiser (rzeczoznawca majątkowy) – a self-prepared estimate is not accepted.

The third mistake is ignoring the interaction between exit tax and KSeF obligations. Companies undergoing cross-border restructuring in 2026 must ensure their KSeF integration is not disrupted by the structural changes. A merger or demerger that changes the taxpayer's NIP number mid-year can create gaps in the mandatory e-invoicing chain. For context on how KSeF affects businesses operating across borders, see our analysis of what KSeF means for your business in Cyprus. Separately, founders acquiring Polish real property as part of an exit restructuring should review the guide to buying property in Poland for related tax obligations.

A self-assessment checkpoint: if your company is planning any cross-border transaction, ask whether Poland will lose taxing rights over any asset as a result. If the answer is yes – or uncertain – exit tax analysis should begin immediately.

What to prepare: compliance checklist

Exit tax compliance requires documentation assembled before the triggering event. Retroactive preparation is possible but carries evidentiary risk. The checklist below applies to both individual and corporate taxpayers.

  • Asset inventory: list all assets with unrealised gains above PLN 100,000 per asset
  • Valuation report: obtain a certified valuation dated on or before the triggering event
  • Residency documentation: gather proof of new tax residency (certificate of fiscal domicile from the destination country)
  • Transfer pricing file: update TP documentation if any related-party transactions are affected
  • Declaration and payment: file the exit tax declaration within 7 days; apply for instalments simultaneously if relocating to EU/EEA

The instalment option is only available for moves to EU or EEA countries. Relocations to third countries – including Switzerland, the United Kingdom post-Brexit, and the United States – require full upfront payment. This is a structural asymmetry in Polish exit tax law that catches many founders by surprise, particularly those relocating to the UK.

For corporate taxpayers, the board resolution authorising the restructuring should specifically address exit tax obligations and record that the board has obtained legal advice. This creates a contemporaneous record that the liability was considered – relevant if KAS later alleges negligence in a penalty assessment.

To receive an expert assessment of your exit tax exposure before a planned relocation or restructuring, contact info@kordeckipartners.com.

Frequently asked questions

Q: Does exit tax apply if I am only temporarily moving abroad and plan to return to Poland within two years?

A: Temporary absence does not automatically prevent exit tax from applying. Polish income tax law looks at the actual change of tax residency, not the stated intention to return. If you cease to be a Polish tax resident – even temporarily – and take high-value assets with you, the exit tax rules may be triggered. The Polish Financial Supervision Authority (Komisja Nadzoru Finansowego, KNF) has separate notification requirements for regulated entities, but the tax obligation is assessed by KAS independently of those. Obtaining a formal residency determination from KAS before departure is advisable when the relocation period is uncertain.

Q: How long does a KAS exit tax audit typically take, and what are the costs?

A: A standard KAS audit of exit tax declarations takes between 6 and 18 months from the date the audit is opened. Complex valuations – particularly for technology companies or those with IP assets – extend that timeline. The direct cost of the audit process itself is nil, but professional fees for representation typically range from PLN 30,000 to PLN 150,000 depending on complexity. If KAS issues an assessment, the taxpayer has 14 days to appeal to the Tax Appeals Chamber (Izba Administracji Skarbowej) before escalating to the Administrative Court (Wojewódzki Sąd Administracyjny, WSA).

Q: Can a family foundation be used to avoid exit tax entirely?

A: A family foundation can eliminate exit tax on a founder's personal relocation if assets are transferred into the foundation before the triggering event and the foundation retains Polish tax residency. It is not a mechanism to avoid tax on gains that have already been realised or on assets transferred after the exit event occurs. The foundation structure must be established with genuine economic substance – a foundation created solely to avoid exit tax, without real governance or beneficiary arrangements, risks challenge under Polish general anti-avoidance rules (GAAR). A tax advisor Warsaw-based or elsewhere should assess the GAAR risk before the foundation is established.

About KORDECKI & Partners

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 exit tax planning, cross-border restructuring, and personal tax compliance. 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.