Business and employment in Poland – the annual PIT return

Running your own business alongside a job is an increasingly common choice among Polish business owners. It raises many questions about settling taxes correctly. Which PIT (personal income tax) form should you fill in? Can different sources of income be combined in one return? How do you settle the tax-reducing amount correctly? These and other issues need to be discussed in detail to avoid tax errors and potential problems with the tax office (urząd skarbowy). Filling in the return for employment income alone is shown in our guide PIT-37 step by step.

How you settle depends above all on the form of taxation chosen for the business. Different forms of taxation require different approaches to the annual return. Some allow income from different sources to be combined in one return, others require separate returns. Knowing these rules is essential to meet your tax obligations correctly.

Business on general rules and a job – one annual return

Business owners whose business is taxed under the general rules, that is, under the tax scale (12% and 32%), can report income from the business and from employment in one annual return. The PIT-36 form, which covers various sources of income taxed under the tax scale, is used for this.

The tax scale applicable in 2026 (unchanged since 2022, Article 27(1) of the PIT Act) has two brackets. The first bracket covers income up to PLN 120,000 and is 12 per cent minus the tax-reducing amount of PLN 3,600. The second bracket covers income above PLN 120,000 and is PLN 10,800 plus 32 per cent of the excess over PLN 120,000.

One of the most important benefits of filing PIT-36 is access to various tax reliefs. Taxpayers can claim the child relief, the internet relief and other reliefs provided for in the tax rules. This is an advantage over other forms of business taxation, although some reliefs are also available under them – for example, the thermal modernisation relief and the R&D relief are also available under the flat 19% tax (podatek liniowy) (Articles 26e and 26h of the PIT Act), and the internet and rehabilitation reliefs also under the flat-rate tax on recorded revenue (ryczałt) (Article 11(1) of the Act on flat-rate income tax).

Tax reliefs available under the general rules:

• Child relief – from PLN 1,112.04 a year for the first child to PLN 2,700 for the fourth and each subsequent child
• Internet relief – up to PLN 760 a year
• Research and development relief
• Rehabilitation relief
• Deduction of contributions to IKZE (individual retirement security account)
• Thermal modernisation relief

A key issue when combining a business with a job is settling the tax-reducing amount of PLN 3,600 correctly. In the PIT-36 return, this amount is deducted only once – from the tax calculated on the combined income from the business and the job. During the year, however, it may be taken into account twice: in the business advances calculated under the tax scale (Article 44(3) of the PIT Act) and in the advances withheld by the employer, if the employee has given the employer a PIT-2 statement on applying the reduction (Article 31b). The advances are then too low and you have to pay the difference in the annual return.

How to settle the tax-reducing amount:

1. Check whether your business is taxed under the general rules
2. Check whether you have given your employer a PIT-2 statement on reducing advances
3. Decide whether the employer should reduce the advances – if so, be prepared for an additional payment in the return
4. Deduct the PLN 3,600 amount once in the annual PIT-36 return
5. Check that the business section of the return is settled correctly

The situation is similar whether the business owner starts a business during the tax year or takes up a job while already running a business. In the first case, when the business owner has a job and starts a business during the year, the employer may already have reduced the advances by PLN 300 a month. In the annual return, the tax-reducing amount is deducted once, so reductions from both sources above PLN 3,600 have to be paid back.

Practical example: Jan has a job and started a business in July 2024. On the basis of PIT-2, his employer reduced the advances for January–June by PLN 1,800 (6 months x PLN 300) and kept reducing them. In the annual PIT-36 return, Jan will deduct the PLN 3,600 amount only once, so he will have to pay back part of the amount taken into account in his business advances.

In the opposite case, when a business owner already runs a business and takes up a job during the year, they can simply not give the employer a PIT-2 statement from the start. The employer will then not reduce the monthly advances by the tax-reducing amount.

Flat tax and a job – separate returns

Choosing the flat tax for the business means filing two separate annual returns. The flat tax is a single rate of 19 per cent on income earned, regardless of its amount. Because employment income is, as a rule, taxed under the general rules, it cannot be reported in the same return as income from a business taxed at the flat rate. We keep the records and calculate flat-tax advances for clients who use our bookkeeping services.

A business owner who chooses the flat tax must file the PIT-36L form with the PIT/B attachment to report business income. The PIT/B attachment contains detailed information on the income or loss from non-agricultural business activity in the given tax year. In addition, employment income must be reported on a separate PIT-37 form.

Flat tax compared with the general rules:

Choosing the flat tax limits your options for reducing tax. Taxpayers cannot deduct most tax reliefs, such as the child relief or the internet relief, from the tax on their business – but they can deduct them in PIT-37 from the tax on employment income (Article 27f(1) and Article 26(1)(6a) of the PIT Act). In addition, they cannot file jointly with their spouse, which under the general rules can bring considerable tax savings.

The deadline for filing all PIT forms, including PIT-36, PIT-36L, PIT-28 and PIT-37, for a given tax year is 30 April of the following year. Taxpayers therefore have several months to prepare and file the relevant returns.

Practical example: Anna runs a consulting business taxed at the flat rate and works for a corporation. In 2024 she earned PLN 100,000 of business income and a salary of PLN 60,000. She must file two separate returns: PIT-36L for the business (tax of PLN 19,000 before deducting contributions) and PIT-37 for the job (tax after deducting the tax-reducing amount).

Flat-rate tax on recorded revenue and a job

The flat-rate tax on recorded revenue is one of the most popular simplified forms of business taxation in Poland. Its main feature is that it taxes revenue, not income, which means that taxpayers do not account for tax-deductible costs at all. The formula for calculating the tax base is simple: revenue minus tax-deductible costs equals income, but under ryczałt the tax base is the revenue itself.

As with the flat tax, running a business on ryczałt while also having a job requires two separate annual returns. Business revenue is reported on the PIT-28 return, while employment income is reported on the standard PIT-37 form.

Ryczałt rates by type of business:

• 3% – trade, catering (excluding sales of beverages with more than 1.5% alcohol)
• 5.5% – manufacturing, construction work, carriage of goods by vehicles with a load capacity above 2 tonnes
• 8.5% – other services; rental and accommodation up to PLN 100,000 of revenue (the excess – 12.5%)
• 10% – buying and selling real estate on one's own account
• 12% – IT services, including software-related services and IT consultancy
• 14% – healthcare, architectural and engineering services
• 15% – among others, management consultancy, financial and advertising services (other than liberal professions)
• 17% – liberal professions

Choosing ryczałt limits your options for reducing tax. Taxpayers cannot use most of the tax reliefs available under the general rules – from revenue they deduct only certain expenses (for example the internet relief, the rehabilitation relief, IKZE contributions) and 50% of the health insurance contribution paid (Article 11(1) and (1a) of the Act on flat-rate income tax), while the child relief can be deducted in PIT-37 from the tax on employment income. In addition, they cannot file jointly with their spouse, which may mean a higher tax burden than under the tax scale.

Steps to settle ryczałt together with a job:

1. Keep revenue records for the business
2. Collect documents confirming your employment income (PIT-11)
3. Calculate the ryczałt tax at the relevant rate
4. Fill in the PIT-28 form for the business
5. Fill in the PIT-37 form for employment income
6. File both returns by 30 April of the following year

Ryczałt requires revenue records in which the taxpayer enters all revenue earned in a given month. The records must be kept systematically and contain all the information required by the tax rules. Failing to keep records, or keeping them incorrectly, may result in losing the right to ryczałt taxation.

Practical example: Marek runs an IT business (programming) taxed under ryczałt at 12% and works part-time. In 2024 he earned business revenue of PLN 200,000 and a salary of PLN 30,000. The ryczałt tax is PLN 24,000 (12% x PLN 200,000, before deducting contributions), and the tax on his job after deducting the tax-reducing amount is PLN 0.

Tax card and a job

The tax card (karta podatkowa) is the most simplified form of business taxation, but it is available only for strictly defined types of business and – since 2022 – only to taxpayers who were already using it on 31 December 2021 and continue to do so (Article 25(1)(1) of the Act on flat-rate income tax); new business owners cannot choose it. Taxpayers pay a fixed monthly amount of tax to the tax office, which is usually relatively low and does not depend on the income actually earned. The monthly amount depends on three main factors.

The first factor is the type of business. The rules set out in detail which types of business can be taxed under the tax card. The second factor is the number of inhabitants of the municipality where the business is carried out. Larger municipalities usually mean a higher monthly amount. The third factor is the number of employees, which also affects the monthly amount.

Types of business covered by the tax card:

• Tailoring, shoe repair and hairdressing services
• Photographic services
• Retail trade at marketplaces
• Transport services (up to 2 vehicles)
• Renovation and construction services
• Catering (small outlets)
• Tourist services (guest rooms)

Running a business taxed under the tax card while also having a job requires two separate tax returns. The business is reported on the PIT-16A form, while employment income is reported on the standard PIT-37 form.

The PIT-16A form is an annual return on the health insurance contribution paid and deducted from the tax card in individual months of the tax year. Unlike other forms of taxation, PIT-16A does not allow you to deduct tax reliefs, file jointly with your spouse or combine different sources of income.

How to settle the tax card:

1. Pay the monthly tax card amount by the 7th of each month for the previous month (for December – by 28 December)
2. Keep records of the amounts paid
3. Collect PIT-11 documents from your job
4. File PIT-16A for the tax card by the end of February
5. File PIT-37 for employment income by 30 April

The deadline for filing PIT-16A is earlier than for other tax returns. Taxpayers must file it by the end of February of the year following the tax year. This means they have less time to prepare their documents than under other forms of taxation.

Practical example: Piotr runs a small hairdressing business on the tax card (PLN 150 a month) and has a job earning PLN 4,000 a month. Each year he pays PLN 1,800 of tax card plus the health insurance contribution, and on his job (PLN 4,000 gross), after deducting costs, social insurance contributions and the tax-reducing amount, he pays about PLN 1,000 of tax.

Ways of filing the annual return

Today taxpayers have considerable flexibility in choosing the most convenient way of filing their annual PIT return. The law provides for three basic ways of delivering a return to the tax office, each with its own features and requirements.

Available ways of filing the annual return:

• Electronically – online (the most convenient)
• In person – at the tax office reception desk
• By post – via the post office or a consular office

The first way is to file a paper return in person at the tax office reception desk. This traditional method requires printing the relevant form, filling it in by hand or on a computer and then delivering it to the office in person. Its advantage is that you receive immediate confirmation of filing and can clarify any doubts with an official.

The second way is to send the return electronically online. This method is valued for its convenience and functionality. When you fill in the form online, the system automatically shows the mandatory fields and flags errors or omissions. As a result, the risk of sending an incorrect return is lower.

The third way is to send the return by post via Poczta Polska (the Polish Post) or a Polish consular office. In this case, the date of filing is the date of the postmark, which means the taxpayer has to allow for delivery time when planning when to send it.

Advantages of filing electronically:

1. Automatic data validation
2. No need for a qualified signature
3. Immediate confirmation of filing (UPO)
4. Option to use data from previous years
5. Faster refund of overpaid tax (45 days instead of 3 months – Article 77 § 1(5) and (5a) of the Tax Ordinance Act (Ordynacja podatkowa))
6. Option to send the return at any time of day

Filing electronically has the added benefit that most tax returns do not require a qualified signature confirmed by a special certificate. This is a considerable simplification compared with earlier technical requirements.

Modern electronic systems also allow data from previous tax years to be imported automatically, which speeds up filling in the form. Taxpayers can also use automatic pre-filling of some fields based on data held by the tax administration.

Electronic accounting systems and the annual return

Modern online accounting systems offer comprehensive solutions for business owners using different forms of tax records. They allow not only day-to-day bookkeeping but also automatic generation of annual returns based on the data entered throughout the tax year.

Users of accounting systems can generate annual returns on different forms, depending on the form of taxation chosen for the business. Returns can be generated on PIT-28 for ryczałt, PIT-36 for the general rules and PIT-36L for the flat tax.

How to generate the annual return in an accounting system:

1. Choose the form matching your form of taxation
2. Indicate the tax year and the purpose of filing
3. Check the automatically completed data
4. Enter any corrections and additions
5. Generate the return as a PDF
6. Send it electronically to the tax office
7. Download the UPO as confirmation of filing

When generating the annual return, the system automatically fills in revenue earned, costs incurred and income for the tax year. It also automatically calculates the social and health insurance contributions deducted and the income tax advances due and paid. The user can check this data and make corrections.

Once the annual return is ready, the system allows it to be sent electronically directly to the tax office. The electronic sending function is integrated into the system, so there is no need to use external platforms. After sending the return successfully, the user can download the UPO, the official confirmation of receipt, which is proof that the return has been filed.

Additional features of accounting systems:

• Automatic calculation of tax payment deadlines
• Generation of tax transfers
• Reminders of upcoming deadlines
• Archiving of tax documents
• Reporting for different forms of taxation

Accounting systems also offer helpful features such as automatic calculation of tax payment deadlines, generation of tax transfers and reminders of upcoming filing deadlines. These features make managing tax obligations much easier.

Practical aspects of settling different sources of income

In practice, settling income from a business and from a job requires attention to many details that can significantly affect the final amount of tax to pay or to be refunded. It is essential to plan your settlements during the tax year to avoid unpleasant surprises when filing the annual return.

Key elements of settling different sources of income:

• Correct settlement of income tax advances
• Best use of tax reliefs
• Settlement of social and health insurance contributions
• Documenting tax-deductible costs
• Planning the timing of revenue

One of the most important aspects is settling correctly the income tax advances paid during the year. When you combine a business with a job, advances are paid by two different parties: the business owner pays them for the business, and the employer withholds them from the salary. The total of these advances should cover the annual tax liability.

Pay particular attention to social and health insurance contributions. A business owner who also has a job pays the health insurance contribution separately for each source (Article 82(1) of the Act on publicly funded healthcare services), which has to be reflected correctly in the annual return. Since 2022, under the tax scale the health insurance contribution is not deductible from income or from tax; under the flat tax it is deductible from income up to a limit (PLN 14,100 in 2026), and under ryczałt 50% of the contribution is deductible from revenue. Social insurance contributions paid for the business are deductible from income (Article 26(1)(2) of the PIT Act).

Tax planning example: Katarzyna runs a business under the general rules (income PLN 80,000) and has a job (income PLN 40,000). The combined income of PLN 120,000 falls within the first tax bracket: the tax is PLN 10,800 (PLN 120,000 x 12% - PLN 3,600). After deducting the child relief for two children (PLN 2,224.08), PLN 8,575.92 remains, or about 7% of income.

An important element of tax planning is using the available tax reliefs. Under the general rules, taxpayers can use the child relief, which can considerably reduce the tax liability. The amount of the relief depends on the number of children: PLN 1,112.04 a year for the first and second child, PLN 2,000.04 for the third and PLN 2,700 a year for the fourth and each subsequent child (Article 27f(2) of the PIT Act). With one child, the relief is available only if income did not exceed PLN 112,000 (spouses combined) or PLN 56,000 (a person who is not married, except a single parent).

Child relief table (2026, amounts unchanged):

Settling tax-deductible costs correctly in the business is also important. These costs directly reduce the tax base, so documenting and accounting for them carefully can bring considerable tax savings. Remember to keep all documents confirming the costs incurred.

If you use a passenger car in your business, you can include the costs of using it in tax-deductible costs. This requires keeping detailed records of business trips and the documents confirming the vehicle's running costs.

Deadlines and obligations related to the annual return

Filing annual returns on time is a basic obligation of every taxpayer, and failing to do so can have serious financial consequences. The basic deadline for most PIT returns is 30 April of the year following the tax year. This applies to PIT-36, PIT-36L, PIT-28 and PIT-37.

Calendar of annual return deadlines:

1. By 31 January – employers send PIT-11 to the tax office (to the employee – by the end of February)
2. By 31 January – PIT-4R is filed (the employer's annual return as payer of tax advances)
3. By the end of February – PIT-16A is filed (tax card)
4. From 15 February to 30 April – most PIT returns are filed
5. 30 April – automatic acceptance of the return made available in e-Tax Office (e-Urząd Skarbowy), but only for income shown in information from payers (no business activity) – this deadline is not extended

The exception to this rule is the PIT-16A form for the tax card, which must be filed by the end of February of the year following the tax year. The earlier deadline results from the specific nature of this form of taxation and the need to settle health insurance contributions.

In addition to filing the annual return, taxpayers must also pay any tax due from the annual settlement. The payment deadline is the same as the filing deadline, which means the tax must be paid by 30 April of the year following the tax year.

Consequences of filing late:

• Late-payment interest on tax not paid on time, charged from the day after the payment deadline
• A fine for a fiscal petty offence for not filing the return on time
• Interest accruing until the arrear is paid
• Possible enforcement proceedings
• Risk of losing preferences that require the return to be filed on time

If the annual return shows an overpayment of tax, the taxpayer has the right to a refund of the overpaid amount or to have it offset against future tax liabilities. The overpayment is refunded within 45 days of filing the return electronically or 3 months of filing a paper return (Article 77 § 1(5) and (5a) of the Tax Ordinance Act), unless the tax office carries out additional checks.

Taxpayers can also file a corrected annual return if they find errors in the original return. A correction can be filed until the limitation period expires – as a rule 5 years from the end of the calendar year in which the tax payment deadline passed (Article 81 and Article 70 § 1 of the Tax Ordinance Act). Since 2016, no written justification has to be attached to a correction – it is enough to file the corrected return (Article 81 § 2).

Key deadlines to remember:

• 30 April – deadline for most PIT returns
• 30 April – automatic acceptance of the return from e-Tax Office (only for income from payers)
• 5 years – deadline for filing a correction of the return
• 45 days – deadline for refunding an overpayment when the return is filed electronically

Another important obligation is keeping the documents related to the annual settlement. All documents confirming revenue, costs, deductions and tax payments must be kept until the limitation period expires, as a rule for 5 years from the end of the calendar year in which the tax payment deadline passed (Article 86 § 1 and Article 70 § 1 of the Tax Ordinance Act).

The most common mistakes in the annual settlement

Experience shows that taxpayers combining a business with a job make typical mistakes when preparing the annual return. Knowing these mistakes helps you avoid them and meet your tax obligations correctly.

The most common mistakes in the annual settlement:

• Incorrect settlement of the PLN 3,600 tax-reducing amount
• Incorrect settlement of health insurance contributions
• Incorrect documentation of tax-deductible costs
• Errors in accounting for the costs of using a company car
• Incorrect settlement of tax reliefs
• Assigning revenue to the wrong tax year
• Incorrect settlement of business losses

The most common mistake is settling the tax-reducing amount of PLN 3,600 incorrectly. Taxpayers often give their employer a PIT-2 statement without taking into account that the tax-reducing amount is already included in their business advances. As a result, the advances during the year are too low, and in the annual return the amount is deducted only once – so the difference has to be paid (without interest if it is paid by 30 April).

Another common mistake is settling health insurance contributions incorrectly. Business owners who also have a job often do not know which contributions they can deduct from the tax base. Under the tax scale, the health insurance contribution – whether from the business or from the job – has not been deductible since 2022; social insurance contributions paid for the business are deductible (social insurance contributions from the job are already taken into account by the employer in PIT-11). Under the flat tax, the health insurance contribution from the business is deductible up to a limit (PLN 14,100 in 2026).

Example of an incorrect settlement: Tomasz runs a business under the general rules and has a job. He gave his employer a PIT-2, so the PLN 3,600 amount was taken into account twice in the advances. In the annual PIT-36 return he deducts it only once and has to pay the difference by 30 April; if he pays late, he will also pay late-payment interest.

Accounting correctly for the costs of using a passenger car in the business also causes problems. Taxpayers often do not keep the required records of business trips or calculate the vehicle's running costs incorrectly. This may lead the tax office to challenge the costs during an audit.

Another significant mistake is settling tax reliefs incorrectly. Taxpayers often do not know which reliefs they can claim under a given form of taxation. The child relief can only be deducted from tax calculated under the tax scale – under the flat tax or ryczałt it is not deducted from the tax on the business, but it can be deducted in PIT-37 from the tax on employment income (Article 27f(1) of the PIT Act).

How to avoid the most common mistakes:

1. Decide deliberately whether to give your employer a PIT-2 statement
2. Keep detailed documentation of tax-deductible costs
3. Keep all invoices and accounting documents
4. Check regularly for changes in tax rules
5. Use the help of a tax adviser or accountant
6. Use reliable accounting software
7. File your return electronically with automatic error checking

Another problem is settling business revenue incorrectly. Taxpayers often do not know in which tax year revenue should be recognised. As a rule, revenue is recognised in the year in which it was earned, regardless of when it was received.

Mistakes also concern settling business losses. Losses can be settled in subsequent tax years, but this requires proper documentation and following specific procedures. Settling losses incorrectly may result in losing the right to deduct them in the future.

Tax planning when combining sources of income

Effective tax planning when combining a business with a job can bring considerable tax savings. The key is to understand how taxes work and to shape your tax position deliberately during the tax year.

Tax planning strategies:

• Choosing the best form of taxation for the business
• Optimising the timing of revenue and costs
• Making full use of available tax reliefs
• Planning social insurance contributions
• Using the option of joint filing with your spouse
• Setting aside reserves for tax liabilities

The first step in tax planning is choosing the best form of taxation for the business. The decision should take into account the expected business revenue, tax-deductible costs and employment income. With low business costs, ryczałt may be more beneficial; with income well above the PLN 120,000 threshold, the flat tax; and with lower income and use of reliefs, the general rules.

An important element of planning is optimising the timing of revenue and costs. Shifting part of the revenue to the next tax year or bringing costs forward can affect the amount of tax due. However, this requires complying with the tax rules on when revenue is earned and when costs are incurred.

Simulation of different forms of taxation:

Optimising social insurance contributions is also an important part of planning. A business owner who also has a job is not compulsorily covered by pension and disability insurance from the business if the contribution base from the employment contract is at least the minimum wage (PLN 4,806 in 2026) – they can then pay these contributions voluntarily (Article 9(1) and (1a) of the Social Insurance System Act). The health insurance contribution from the business is payable regardless of the job.

Tax planning should also consider joint filing with your spouse under the general rules. Joint filing can be beneficial when the spouses' incomes differ considerably. It makes use of tax progression and reduces the family's total tax liability.

Tax planning example: A married couple with two children: the husband runs a business under the tax scale (income PLN 150,000), the wife has a job (income PLN 50,000). Filing separately, their total tax is PLN 22,800 (PLN 20,400 + PLN 2,400), and filing jointly PLN 16,800 (2 x PLN 8,400) – a saving of about PLN 6,000 a year; the child relief is available in both cases.

Setting aside reserves for tax liabilities is another important element of planning. A business owner should keep track of the income tax advances paid and, if necessary, make additional payments to avoid having to pay tax with interest.

Tax planning also requires keeping up with changes in tax rules. Following new legislation regularly allows you to adjust your tax strategy to changing legal conditions and use new optimisation opportunities.

Frequently asked questions