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18 January 2023
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2 minutes

Payroll compliance in Poland

Poland is one of Europe’s most attractive locations for foreign investment, thanks to its stable economic environment, educated, diverse workforce and favourable geographic position at the intersection of most of Europe’s main communication routes.

However, recent sweeping changes to Poland's labour laws have increased the complexity of doing business in the country, and Poland now ranks as the world’s 10th most complex jurisdiction to do business in, according to TMF Group’s 2022 Global Business Complexity Index.

  • Over the past year, the Polish government has introduced several pieces of payroll-related legislation, including the ‘Polish Deal’, which in January 2022 overhauled the taxation system for corporations, entrepreneurs and employees, as well as the way salaries are calculated.
  • In July 2022, amendments to these new rules – Polish Deal 2.0 – were introduced, which included a reduction of personal income tax from 17% to 12%, the elimination of tax relief for the middle class and changes to health insurance premiums.
  • Annual leave entitlement in Poland depends on an employee’s seniority. Those who have worked less than 10 years are entitled to 20 days’ annual leave, while those who have worked 10 years or more are entitled to 26 days’ annual leave. This calculation includes not only years of employment, but also secondary and higher education.

If you’re doing business in Poland and are looking to learn more about Poland’s labour laws, incorporation procedures, tax implications and compliance requirements, request a copy of our full country profile, Doing business in Poland.

Payroll compliance guide

The global payroll compliance landscape can be a difficult one to navigate and interpret. Overseas businesses can be subject to greater scrutiny on the part of local governments, regulators and tax authorities.

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