Reduced late-payment interest on tax arrears is an important support tool for taxpayers who show good faith in settling their tax liabilities. The system was introduced to encourage taxpayers to correct errors in their tax returns themselves and to pay the tax due quickly. The reduced interest mechanism operates under the Tax Ordinance Act (Ordynacja podatkowa) and is a preferential solution for taxpayers who meet certain conditions.
The current system of reduced interest on tax arrears has changed significantly in recent years. The most important change was the reduction of the rate from 75% to 50% of the basic rate, which took place on 1 January 2016 (Article 56a of the Tax Ordinance Act). From 5 March 2026 the reduced rate is 5.25% a year. This change was intended to further encourage taxpayers to correct their tax returns themselves and to pay their tax liabilities on time. Understanding how reduced interest works is key for every taxpayer who may need to correct a tax return they have filed. Corrections often concern VAT returns, so our overview of current VAT rates in Poland may come in handy.
Since 1 January 2016 reduced interest on tax arrears has been 50% of the basic rate under the amended provisions of the Tax Ordinance Act. Previously, from 1 January 2009 to 31 December 2015, the reduced rate was 75% of the basic rate
Basic rules of reduced tax interest
The system of reduced interest on tax arrears was designed as an incentive for taxpayers who detect errors in their tax returns themselves and take quick corrective action. The basic idea is to reward taxpayers for honesty and a quick response to irregularities they discover. The mechanism is an alternative to full late-payment interest, which can be much more burdensome financially.
Reduced interest is a preferential interest rate on tax arrears that can be applied only in specific cases and under strict conditions. It is not an automatic right of every taxpayer, but a privilege for those who meet all the requirements of the Tax Ordinance Act. Reduced interest is 50% of the basic rate, which means significant relief compared with the full late-payment interest rate. The reduced rate does not apply to a correction filed after delivery of a notice of intent to start a tax inspection or of an authorisation for a customs and tax inspection, or to a correction made as a result of verification activities (Article 56a § 3).
Reduced interest on tax arrears is 50% of the basic rate and can be applied only by taxpayers who meet two basic conditions of the Tax Ordinance Act together. The system is preferential and is not automatically available to all taxpayers
The reduced interest mechanism is based on the taxpayer acting voluntarily and quickly. The taxpayer must detect the error in their tax return themselves, file a correction within the required deadline and pay the tax due together with interest within the set time. Failing to meet any of the conditions results in losing the right to the preferential rate and having to pay interest in full. We prepare corrected returns and JPK files for clients who use our bookkeeping services.
Conditions for reduced interest
The right to reduced interest on tax arrears is available to taxpayers who meet two basic conditions of the Tax Ordinance Act together. Both conditions must be met at the same time, because failing to meet either of them results in losing the right to the preferential rate. These conditions were designed so that only taxpayers who show good faith and act quickly in correcting their tax liabilities benefit from the relief.
The procedure for obtaining reduced interest requires the taxpayer to act and to observe strictly defined deadlines. The taxpayer cannot count on the preferential rate being applied automatically - they must take all the required steps themselves, in the right order and within the set deadlines. The process requires good knowledge of tax rules and timely action.
Taxpayers can use reduced interest only after meeting two conditions together: filing a legally effective correction of the return within 6 months of the deadline for filing the return, and paying the tax arrears within 7 days of filing the correction
The first condition concerns filing a legally effective correction of the tax return. The correction must be filed no later than 6 months from the deadline for filing the return. This period is counted from the day on which the taxpayer was obliged to file the original tax return, not from the day the return was actually filed. The correction must be legally effective, which means it must meet all the formal requirements of tax law.
The second condition concerns the timely payment of the tax arrears. The taxpayer must pay the tax arrears within 7 days of filing the correction. This deadline is short and cannot be extended (it moves only when its last day falls on a Saturday or a day off work), so the taxpayer must be financially prepared to settle the liability quickly. The payment must cover the full amount of the tax arrears resulting from the correction. Instead of a payment, within the same deadline you can file an application to offset an overpayment or tax refund against the arrears (Article 56a § 2).
Procedure for filing a correction
Filing a legally effective correction of the tax return is the first and key step in obtaining reduced interest on tax arrears. The correction must be prepared in compliance with all the formal and substantive requirements of tax law. In the correction, the taxpayer must show all the changes compared with the original return and correctly calculate the resulting difference in tax.
Preparing the correction requires a careful analysis of the original tax return and identification of all errors or omissions that affected the amount of tax calculated. The taxpayer should have appropriate documentation supporting the changes and be able to show that the correction is justified on the merits. The right to correct a return is suspended for the duration of tax proceedings or a tax inspection to the extent they cover (Article 81b of the Tax Ordinance Act).
- Carefully analyse the original tax return to identify errors or omissions
- Gather all the documentation justifying the changes to the return
- Prepare the correction in compliance with all the formal requirements of the law
- Calculate the correct amount of tax and the difference compared with the original return
- File the correction with the competent tax office (urząd skarbowy) within 6 months of the deadline for filing the return
- Keep documentation confirming that the correction was filed, together with the date it was received by the tax office
A correction of the tax return must be filed within 6 months of the deadline for filing the original tax return. This period is counted from the day on which the taxpayer was legally obliged to file the return, not from the day the return was actually filed
A correction of a tax return is a complete, corrected return (Article 81 § 2 of the Tax Ordinance Act) – it must contain all the elements required for the type of return, with the correct amounts. A written statement of the reasons for the correction has been voluntary since 1 October 2026, and is mandatory only for a correction showing an overpayment of more than PLN 10,000 (Article 81 § 2a–2b, Journal of Laws (Dz.U.) 2026 item 846). The correction must be signed by the taxpayer or their attorney and filed with the tax office competent for the taxpayer.
Timely payment of the tax arrears
The second condition for reduced interest on tax arrears concerns the timely payment of the arrears resulting from the correction. The taxpayer has only 7 days from filing the correction to pay the full amount of the tax arrears. This deadline is very short and requires the taxpayer to prepare financially in advance and organise the payment efficiently. Missing this deadline automatically results in losing the right to reduced interest.
The payment of the tax arrears must cover the full amount resulting from the correction of the tax return. The taxpayer should not make partial or instalment payments - the full amount must be paid within the set deadline. The payment must be calculated together with the interest: if it does not cover the arrears together with interest, it is allocated proportionally to the arrears and the interest (Article 55 § 2), so part of the arrears remains unpaid. The payment must be made in a way that allows the tax office to identify it, so it is important to fill in the transfer title correctly and provide all the required identification details. Regular tax payments are covered in our overview of income tax advance deadlines.
The tax arrears must be paid within 7 days of filing the correction of the tax return. This deadline is short and cannot be extended, so the taxpayer must be financially prepared to settle the tax liability quickly
For a bank transfer, the date of payment of the tax arrears is the day the taxpayer's bank account is debited on the basis of the transfer order (Article 60 § 1 point 2 of the Tax Ordinance Act), and for a cash payment – the day of the payment. It is still worth ordering the transfer in advance so that the account is debited before the 7-day deadline expires. The taxpayer should keep documentation confirming the payment and the date it was made.
Current reduced interest rates in 2026
The amount of reduced interest on tax arrears in 2026 is based on the basic late-payment interest rate, which changes periodically under the Tax Ordinance Act. Reduced interest is 50% of the basic rate, which means significant relief for taxpayers who meet the conditions for this preferential rate. The basic late-payment interest rate is 200% of the NBP Lombard rate plus 2 percentage points, but no less than 8% (Article 56 § 1 of the Tax Ordinance Act), and it changes automatically from the day the Monetary Policy Council changes the Lombard rate (Article 56c), while the Minister of Finance only announces it in a notice (Article 56d).
Under the current rules, from 5 March 2026 (NBP Lombard rate 4.25%) the basic late-payment interest rate is 10.50%. This means that reduced interest on tax arrears for taxpayers who meet the conditions is 5.25% a year (notice of the Minister of Finance and Economy of 6 March 2026, Monitor Polski (M.P.) 2026 item 269). The prolongation fee charged when tax is split into instalments or its payment deadline is deferred has the same rate (Article 57 § 2). The rate will change with the next change of the NBP Lombard rate.
| Period of application | Basic rate | Reduced interest (50%) | Legal basis |
|---|---|---|---|
| From 5 March 2026 | 10.50% | 5.25% | Articles 56 and 56a of the Tax Ordinance Act, M.P. 2026 item 269 |
| From 4 December 2025 to 4 March 2026 | 11.00% | 5.50% | Articles 56 and 56a of the Tax Ordinance Act |
From 5 March 2026 the basic late-payment interest rate is 10.50%, which means that reduced interest for taxpayers who meet the conditions is 5.25% a year. The rate changes with the NBP Lombard rate set by the Monetary Policy Council
It is worth noting that under Article 54 § 1 point 5 of the Tax Ordinance Act, late-payment interest is not charged if it would not exceed three times the fee charged by the designated operator (Poczta Polska) for treating a letter as registered mail. In practice this threshold is taken to be PLN 8.70. This means that if the calculated late-payment interest does not exceed this amount, the taxpayer does not have to pay it.
Calculating reduced interest
Calculating reduced interest on tax arrears requires precise determination of several key elements: the amount of the tax arrears, the period for which interest is charged and the current reduced interest rate. The calculation must follow the rules of the Tax Ordinance Act, taking into account all the specific rules on charging late-payment interest in tax matters.
The basis for calculating the interest is the amount of tax arrears resulting from the correction of the tax return. The interest period starts on the day after the day on which the tax should have been paid under the original return and ends on the day the arrears are paid. Interest is charged for each day of delay, on the basis that a year has 365 days regardless of whether it is a leap year. Arrears often arise on advance payments — the guide to calculating income tax advance payments explains how they are worked out.
Interest on tax arrears is calculated for each day of delay, from the day after the tax payment deadline up to and including the day of payment. A calendar year has 365 days regardless of whether it is a leap year
The formula for calculating late-payment interest is as follows: the amount of tax arrears multiplied by the number of days of delay, multiplied by the interest rate, divided by 365 days and by 100. For reduced interest, a rate of 50% of the basic rate is used. For example, with tax arrears of PLN 10,000 and a 30-day delay, at the reduced interest rate of 5.25% applicable from 5 March 2026, the interest would be PLN 43.15, i.e. PLN 43 after rounding to the full złoty (Article 63 § 1 of the Tax Ordinance Act). At the basic rate of 10.50% it would be PLN 86.
Consequences of not meeting the conditions
Failing to meet any of the conditions for reduced interest on tax arrears automatically results in losing the right to the preferential rate. In that case, the taxpayer must pay late-payment interest in full, i.e. at the basic rate, which from 5 March 2026 is 10.50%. The reduced rate is lost by operation of law – the tax authority can only, at the taxpayer's request and in justified cases, waive the interest (Article 67a of the Tax Ordinance Act).
The most common reasons for losing the right to reduced interest are: missing the 6-month deadline for filing the correction of the tax return, missing the 7-day deadline for paying the tax arrears after filing the correction, filing a correction that is not legally effective, paying the tax arrears only partly instead of in full, and filing the correction only after an inspection has been announced or as a result of verification activities.
- Missing the 6-month deadline for filing the correction of the tax return
- Missing the 7-day deadline for paying the arrears after filing the correction
- Filing a correction that is not legally effective (for example during an inspection or proceedings covering that matter)
- Paying the tax arrears only partly instead of in full
- Filing the correction after delivery of a notice of intent to start a tax inspection or of an authorisation for a customs and tax inspection
- Filing the correction as a result of verification activities by the tax office
Failing to meet any of the conditions for reduced interest automatically results in losing the right to the preferential rate and having to pay interest in full at the basic rate. This happens by operation of law, without a decision of the tax office
If the right to reduced interest is lost, late-payment interest must be calculated at the basic rate for the entire period of the tax arrears – the taxpayer calculates the interest themselves (Article 53 § 3 of the Tax Ordinance Act). The taxpayer will then have to pay the difference between the interest calculated at the basic rate and the amount already paid. In addition, the tax office may carry out verification activities or start a tax inspection to check whether the correction of the tax return is correct.
Practical aspects of applying reduced interest
Applying the rules on reduced interest on tax arrears in practice requires taxpayers to plan and prepare the whole process of correcting the return and paying the arrears carefully. Taxpayers should regularly review their tax returns for possible errors or omissions so that they can react quickly when they discover irregularities. Detecting errors early significantly increases the chances of benefiting from the preferential rate.
The key to obtaining reduced interest is managing deadlines properly. Taxpayers should keep accurate records of their tax return deadlines and monitor the 6-month deadline for filing a correction. It is equally important to ensure sufficient cash flow to pay the tax arrears within the required 7-day deadline.
A business owner running a trading business filed their PIT (personal income tax) return for 2025 on time, but a few months later discovered that they had left out part of their sales revenue. The error was detected in August 2026, i.e. within 6 months of the deadline for filing the return (30 April 2026), which ends on 30 October 2026. The business owner immediately prepared a correction of the return, filed it with the tax office and within 7 days paid the additional tax together with reduced interest, saving a significant amount compared with full late-payment interest.
Using reduced interest successfully requires systematic monitoring of deadlines, proper preparation of the correction of the return and sufficient cash flow to pay the tax arrears quickly. Planning and organisation are key to success
Taxpayers should also remember to keep full documentation of the process of correcting the return and paying the tax arrears. This documentation may prove essential in the event of inspections or doubts on the part of the tax authorities. It is advisable to keep copies of the correction, confirmations of filing documents with the tax office and documents confirming payment of the tax arrears.
Differences compared with the previous rules
The system of reduced interest on tax arrears has undergone significant changes in recent years that have affected its attractiveness for taxpayers. The most important change was the reduction of the reduced interest rate from 75% to 50% of the basic rate, which took effect on 1 January 2016. This change meant a significant improvement in conditions for taxpayers who meet the requirements for the preferential rate.
The previous system applied for seven years, from 1 January 2009 to 31 December 2015, and provided for reduced interest of 75% of the basic rate. The change introduced in 2016 was part of a broader amendment to the Tax Ordinance Act aimed, among other things, at increasing taxpayers' motivation to correct errors in their tax returns themselves.
Before 1 January 2016 reduced interest on tax arrears was 75% of the basic rate and applied for seven years from 1 January 2009. The change to the current 50% rate was part of a broader amendment to the Tax Ordinance Act
The current rules have kept the basic conditions for reduced interest, i.e. the requirement to file the correction within 6 months and to pay the arrears within 7 days of filing the correction. The rules for calculating interest have not changed either. Since 2016, however, there has also been an increased interest rate – 150% of the basic rate (from 5 March 2026 15.75%) – applied to larger VAT and excise duty arrears detected by the authorities or shown in a correction filed after an inspection has been announced (Article 56b of the Tax Ordinance Act).
Impact on business owners' tax planning
Reduced interest on tax arrears is an important element of tax planning, especially for business owners running complex businesses. Awareness of the preferential rate may influence taxpayers' decisions on when to file tax returns and how to manage tax risk. Business owners should include this mechanism in their internal tax procedures.
For business owners operating on a large scale, where the risk of errors in tax returns is higher due to the complexity of business operations, the reduced interest mechanism can be an important financial safeguard. The possibility of using 50% of the basic rate means significant savings when tax returns need to be corrected, which may have a significant impact on the company's financial results.
The reduced interest mechanism on tax arrears should be included in business owners' tax planning as part of managing tax risk and potential financial savings. This is especially important for entities running complex businesses
Business owners should implement appropriate internal procedures that allow errors in tax returns to be detected quickly and the correction and payment of arrears to be carried out efficiently. This may include regular reviews of tax returns, training for staff responsible for taxes and ensuring sufficient cash flow to pay any tax arrears quickly.
