Poland offers a rather interesting system of social benefits. In addition to high sickness benefits, there are also tax breaks for students up to 26 years of age and financial support for families with children in Poland. The last two advantages will be discussed in today’s article. You will learn how to obtain them and what you need to do to get them.
Poland as a tax haven…for the young
As of 1 August 2019, Poland has a zero income tax for people under 26. In practice, this means that if you are under 26, you pay no income tax up to an annual income of 85,528 zlotys. Bear in mind that this exemption only applies to income tax; you will still have to make insurance contributions (the amount depends on the type of contract). Even better are the students. In the case of a “contractual agreement”, they are also exempt from insurance contributions, as the state pays them for them. If they are employed under an employment contract, they are also liable for health and social security contributions.
Examples from Practice
Example 1
Joachim is 23 years old, originally from the Czech Republic, and came to Poland where he got a job as a customer support worker on the basis of an “umowa zlecenie”. He works for an international company that sells IT products. As Joachim likes to work on his personal development, he started studying at the same time at a university in Warsaw. What’s in it for Joachim? In addition to the newly acquired knowledge and experience, he does not have to pay any income tax or make any social security and health insurance contributions (these are fully covered because he is a student). He earns 5000 zlotys gross, but thanks to zero taxation he receives the full amount in his account every month.
Example 2
Jozef is 19 years old and came to Poland from Slovakia. He wants to obtain his first work experience here. Thanks to Ahoy Career, he managed to find a job in a company that produces profiles used in the manufacture of plastic windows. He mainly takes care of this company’s Slovak customers. Unlike Joachim, Jozef is employed under a work contract and is not studying. Like Joachim, he has not yet reached the age of 26, so he is exempt from income tax. Thus, he receives 3926.50 zlotys in his account. For a better idea, we attach a summary table.
| Net payout | 3926.50 zł |
| Pension insurance | 488.00 zł |
| Disability insurance | 75.00 zł |
| Sickness insurance | 122.50 zł |
| Health insurance | 388.00 zł |
| Income tax advance | 0.00 zł |
| Gross payout | 5000.00 zł |
Example 3
Katarina is 27 years old and works in Poland as a PPC specialist for an advertising agency. She works under an employment contract and has agreed a gross remuneration of PLN 5000. How much money does Katarina actually receive in her account? 3613.00 zlotys.
| Net payout | 3613.00 zł |
| Pension insurance | 488.00 zł |
| Disability insurance | 75.00 zł |
| Sickness insurance | 123.00 zł |
| Health insurance | 388.00 zł |
| Income tax advance | 313.00 zł |
| Gross payout | 5000.00 zł |
500 Plus
Rodzina 500 plus is a Polish government program launched on 1 April 2016 to help families raise their children through a monthly allowance of 500 zlotys. Any family can apply for this allowance and it is available for each child. As a foreigner, you will have a bit more to deal with, but once you have completed all the requirements, you will also be entitled to the allowance.
What will it take?
First of all, your stay in Poland must be legal and you must have the necessary documentation. As a citizen of the European Union, you will have no problem registering your residence. EU nationals can remain in Poland for 3 months without declaring their residence. You must then report your stay. If you don’t have your own apartment, the office will register your stay for the duration of the lease, but no longer than a year (it’s not a problem to extend your stay). We have explained the registration of residence and all administrative matters in detail in this article.
How to Apply for 500 Plus
There are several ways to claim child benefit. The most convenient option is to apply using online banking. After logging in, you fill in the form, confirm with the SMS code and the matter is settled. A list of banking institutions offering this service can be found on this portal. The second option is the ePUAP system (system for electronic communication with authorities). Registering for this system can be a little tricky in some cases, but it’s definitely worth having. If you’re not the overly technical type, you can go classic on this one. You can send your application by post or submit it in person at the office.
Why is Poland doing this?
At first glance, it might seem that in Poland they like to give money away. However, if we look more closely at this issue, we find that the vast majority of support programs are targeted mainly at young people. And it is this group of people who, with the passage of time, will assume responsibility for the overall development of the state. Rather than a giveaway, it is a thoughtful investment in the future.
We still have one piece of good news for you! Once you have successfully completed your interview and arrived in Poland, you will have our Community Manager at your disposal to help you during your first days and weeks in your new country. Whether it’s help with arranging a bank account, information about important offices or advice on how and where to find suitable accommodation, you’ll have a contact person to turn to from day one.
