Poland | Employee Incentive Plans

The Polish Personal Income Tax (PIT) Act contains only two regulations for the taxation of income generated in connection with participation in employee incentive plans. One of these provisions refers to incentive schemes based on stocks or shares, with the second relating to incentive plans based on derivatives.

Depending on how the incentive scheme is construed, income derived in connection with participation in such a scheme may be taxed with 19% PIT (for capital gains) or at a progressive scale up to 32%. Tax classification of incentive schemes also influences social security and health insurance contributions.

Stocks or shares

The Polish PIT provisions relating to incentive schemes based on stocks allow for the deferral of the moment of taxation of stocks acquired or subscribed for under such incentive scheme until their future sale (regardless of whether they were acquired free of charge or below their market value). Upon the satisfaction of the conditions