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Legislation Monitoring Centre
 
In Poland there is neither an internet portal nor an institution for employers responsible for monitoring the legislation process of regulations that determine the rules for business activity. At present employers  learn about changes in the law mainly from mass media or simply through the grapevine, usually with delay.

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Principles of settlement of members of supervisory boards

19-02-2015

 

 

Principles in force until 31.12.2014

 

Principles in force from 01.01.2015

 

Member of the SB, having the place of residence:

SOCIAL INSURANCE CONTRIBUTIONS

TAX

SOCIAL INSURANCE CONTRIBUTIONS

TAX

Territory of Republic of Poland

Deduction from remuneration- only health insurance contributions: 9% of the base  amount

According to the current tax rate of 18%

Deduction from remuneration -pension insurance contribution of 9.76%, annuity insurance of 1.5% of gross remuneration and health insurance in the amount of  9% of the base amount.

According to the current tax rate of 18%

EU, EEA Member States, Switzerland

No requirement to join the social security insurance.

 

Flat-rate tax in the amount of 20%

After the presentation of a certificate by a Member of SB confirming exposure to foreign social security system.  –lack of obligation to pay compulsory social security contributions in Poland. No certification - the obligation to pay contributions to pension insurance of 9.76%, annuity insurance of 1.5% of gross remuneration and health insurance in the amount of 9% of the base.

Flat-rate tax in the amount of 20%

Outside the territory of Republic of Poland, and other countries than the above mentioned

No requirement to join the social security insurance.

 

Flat-rate tax in the amount of 20%

The obligation to pay contributions for pension insurance of 9.76%, annuity insurance of 1.5% of gross remuneration and health insurance in the amount of 9% of the base.

Flat-rate tax in the amount of 20%

 

 

 

Detailed description below:

Member of the Supervisory Board

Until 31.12.2014

From 01.01.2015

Residing on Polish territory; remunerated for performing functions

SOCIAL INSURANCE

 

Member of the supervisory board is only subject to mandatory health insurance in the amount of 9% of the base.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TAXATION OF REMUNERATION

 

If the amount of remuneration specified in the agreement is higher than PLN 200, remuneration received by a member of the supervisory board shall be subject to taxation on general principles. In this case, the payer is required to collect income tax withholdings, from the available benefit, in the amount of 18% of earned income, less tax deductible expenses. As it is apparent from the art. 22 section 9 item 5 of the Act in Income Tax from individuals, tax deductible expenses from the above benefits are PLN 111.25 per month and not more than PLN 1335  for the fiscal year. When the taxpayer obtained the same kind of revenues from more than one entity, or from the same entity but due to a number of legal relations, then the annual tax deductible expenses may be increased, but cannot exceed the total amount of PLN 2002.05.

At the written request of a member of the supervisory board, tax may be calculated in the amount of 32%.

There is no possibility to use increased tax deductible expenses to calculate the withholdings - PLN 139.06

If the amount of charges paid to a member of the supervisory board- who is not an employee of the payer- does not exceed PLN 200, the tax payer applies tax at a flat rate of 18% of income and does not calculate tax deductible expenses.

 

SOCIAL INSURANCE

 

Member of the Supervisory Board is subject to compulsory pension insurance, annuity insurance and health insurance in the amount of 9% of the base.

Pension insurance contributions are paid by the insured and the payers, from own resources, in equal parts. The contributions for annuity insurance  are paid by the insured from own resources in the amount of 1.5% of the base and by the payers in the amount of 6.5% of the base.

The limits provided in art 19 section 1 of Law on Social Insurance System shall be applied to the basis of contributions for pension and annuity insurance of supervisory board members and therefore tax base in question may not exceed the amount of thirtyfold projected average monthly remuneration. Please find attached declaration each Member of Supervisory Board should submit.

 

However, with regard to contributions to the Labour Fund, the obligation to pay them will exist, provided that the conditions laid down in the Act of 20 April 2004, on employment promotion and labour market institutions (Journal of Laws of 2013, item 674 as amended) will be met;

 

TAXATION OF REMUNERATION

 

The tax withholdings in the amount of 18% of earned income less the tax deductible expenses and contributions for social insurance (pension and annuity contributions).

Residing outside the territory Poland, from the EU, EEA and Switzerland, remunerated for performing functions

SOCIAL INSURANCE

 

No requirement to join the social security insurance.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TAXATION OF REMUNERATION

 

Remuneration of a foreigner for the performance of duties of a member of the supervisory board in the Polish company should be taxed at the 20% rate calculated from the income obtained. The company should calculate and collect the flat-rate tax of  20%, and transfer it on account of the Inland Revenue.

By the end of February of the year following the fiscal year, the Company, acting as the payer is required to send the taxpayer and the Inland Revenue -managed by the head responsible for taxation of foreign persons- a personal information on the amount of income received by individuals not having residence in Poland (IFT-1/IFT-1R).

Non-resident obtaining the only income through the payer, taxed at the flat rate in Poland, is not required in principle to submit annual tax return. The only exception is the situation when a foreigner decides to settle the income obtained according to the tax rate (he has such a right), by filing a tax return and marking the manner of income settlement thereof. The decision on whether to submit the annual tax return (with taxation according to the tax rate) or not and settling for a flat-rate taxation is entirely up to him.

 

SOCIAL INSURANCE

 

Member of the Supervisory Board is subject to compulsory pension insurance (9,76%), annuity insurance (1,5%).  Pension insurance contributions are paid by the insured and the payers, from own resources, in equal parts. The contributions for annuity insurance  are paid by the insured from own resources in the amount of 1.5% of the base and by the payers in the amount of 6.5% of the base.

The limits provided in art 19 section 1 of Law on Social Insurance System shall be applied to the basis of contributions for pension and annuity insurance of supervisory board members and therefore tax base in question may not exceed the amount of thirtyfold projected average monthly remuneration.  Please find attached declaration each Member of Supervisory Board should submit.

 

However, with regard to contributions to the Labour Fund, the obligation to pay them will exist, provided that the conditions laid down in the Act of 20 April 2004, on employment promotion and labour market institutions (Journal of Laws of 2013, item 674 as amended) will be met;

 

In case of foreign members of supervisory boards, coming from EU, EEA and Switzerland, as well as those countries with which Poland has concluded agreements on social security, avoiding mandatory social insurance contributions in Poland from remuneration paid to them will be possible only after the presentation of a certificate confirming their exposure to foreign social security system. Obtaining such a certificate may, however, indicate the potential need to deduct contributions from the remuneration of the member of Supervisory Board  abroad.

 

TAXATION OF REMUNERATION

 

Unchanged

Residing outside the territory of Poland, from other countries;

remunerated for performing functions

SOCIAL INSURANCE

 

No requirement to join the social security insurance.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TAXATION OF REMUNERATION

 

as above

 

 

SOCIAL INSURANCE

 

Member of the Supervisory Board is subject to compulsory pension insurance (9,76%), annuity insurance (1,5%).  Pension insurance contributions are paid by the insured and the payers, from own resources, in equal parts. The contributions for pension insurance are paid by the insured from own resources in the amount of 1.5% of the base and by the payers in the amount of 6.5% of the base.

The limits provided in art 19 section 1 of Law on Social Insurance System shall be applied to the basis of contributions for pension and annuity insurance of supervisory board members and therefore tax base in question may not exceed the amount of thirtyfold projected average monthly remuneration.  Please find attached declaration each Member of Supervisory Board should submit.

 

However, with regard to contributions to the Labour Fund, the obligation to pay them will exist, provided that the conditions laid down in the Act of 20 April 2004, on employment promotion and labour market institutions (Journal of Laws of 2013, item 674 as amended) will be met;

 

TAXATION OF REMUNERATION

 

 

Unchanged