15% flat-rate tax from 2027 - who will pay higher tax?

Amendments to tax legislation - what will change from 1 January 2027?

The Ministry of Finance has prepared an extensive draft amendment to the acts on personal income tax (PIT), corporate income tax (CIT) and the flat-rate tax on recorded revenue (ryczałt). Although the draft does not introduce any new levy, it significantly changes the conditions for using preferential tax rates. For many business owners, this will amount to a real increase in their tax burden.

Currently, around 2 million taxpayers in Poland use the flat-rate tax on recorded revenue. This simplified form of taxation is popular thanks to its low rates and straightforward accounting. However, the planned changes may mean that, for a significant proportion of them, the flat-rate tax will no longer be as attractive an option as before.

It is worth stressing that the draft has been at the stage of inter-ministerial arrangements, consultation and review since autumn 2025. This means that the final shape of the rules may still change during government and parliamentary work. Nevertheless, business owners should already prepare for the potential consequences and consider alternative forms of taxation.

Who exactly will be hit by the higher flat-rate tax?

The planned changes do not mean an increase for all taxpayers using the flat-rate tax. The draft amendment precisely identifies the groups that will lose access to the lower rates. It is worth analysing carefully whether your business falls within the categories covered by the changes.

Groups of business owners subject to the higher rate

• Sole proprietorships (JDG) - business owners who run their business alone, without employing staff under employment contracts
• Businesses employing people under civil-law contracts - entities that do use the work of other people, but not under employment contracts (e.g. solely contracts of mandate or contracts for specific work)
• Business owners earning income from related parties - in particular from the use of intellectual property rights in dealings with related parties
• Persons earning income from rental or lease to related parties, e.g. those renting out property to their own company

The key mechanism of the changes is the introduction of a PLN 100,000 revenue threshold. A business owner providing services currently subject to the 8.5% rate, who does not employ anyone under an employment contract, will pay flat-rate tax of 15% on revenue above this amount. This is a nearly twofold increase in the rate, which may significantly affect the profitability of operating in this form.

Controversy surrounding the draft - views from the business community

The draft has met with wide criticism from organisations representing business owners. Comments were submitted by, among others, the Polish Craft Association (ZRP), the National Chamber of Commerce (KIG) and the National Council of Tax Advisers (KRDP). Each of these institutions raises arguments worth knowing when planning your tax strategy.

Position of the Polish Craft Association

ZRP warns that the changes will hit above all small, often one-person craft workshops - hairdressers, car mechanics, tailors and watchmakers. The organisation rightly points out that revenue of PLN 100,000 does not necessarily mean high income, especially in low-margin industries where the cost of materials and premises absorbs a large part of takings. ZRP calls for the increase to be withdrawn entirely or, alternatively, for the threshold to be raised to at least PLN 300,000.

Position of KIG and KRDP

The National Chamber of Commerce and the National Council of Tax Advisers raise a fundamental systemic argument - employing a member of staff is not directly linked to tax avoidance. In their view, the regulation could lead to the pathological phenomenon of business owners artificially creating jobs where their business model does not require additional personnel at all. The worst affected would be one-person businesses, B2B contractors and family businesses.

How to prepare for the changes - practical tips

Regardless of whether the draft is passed in its current form, business owners should take preparatory steps now. Analysing your tax position early will help you avoid unpleasant surprises and optimise your tax burden lawfully.

Step by step - what should you do now?

1. Analyse your tax position - check whether your business falls within the group covered by the planned changes and what their real impact on your tax burden will be
2. Compare forms of taxation - the Polish Craft Association warns that some businesses may switch to the flat-rate income tax (19%) or the progressive tax scale, which involves higher accounting costs but in some cases may prove more beneficial
3. Assess your employment structure - if you use the services of associates under civil-law contracts, consider whether switching to an employment contract would be justified from a business perspective
4. Review transactions with related parties - income from rental, lease or the use of intellectual property rights in dealings with related parties will be subject to particular scrutiny by the tax authorities
5. Consult a tax adviser - an individual analysis of your situation will allow you to develop the best tax strategy for 2027 and the following years

It is worth remembering that in the explanatory memorandum to the draft, the Ministry of Finance indicated two main aims of the changes: limiting the use of preferential tax rules contrary to their purpose and encouraging business owners to employ staff. Understanding the legislator's intentions helps to anticipate the direction of any further legislative changes.

Summary - do not wait for the rules to come into force

The planned increase of the flat-rate tax to 15% on revenue above PLN 100,000 is a significant change that will affect above all sole proprietorships, businesses that do not employ staff under employment contracts, and entities dealing with related parties. Although the draft is still at the consultation stage and may be modified, its general direction appears settled - the Ministry of Finance is seeking to close loopholes in the tax system.

Proper preparation is the key to avoiding unexpected costs. Changing the form of taxation, restructuring your employment model or reviewing transactions with related parties are decisions that require professional legal and tax analysis. The sooner you start planning, the more optimisation options you will have available.

Not sure how the planned changes will affect your business? Contact our firm. Our specialists will analyse your tax position, compare the available forms of taxation and propose solutions tailored to your business model. Book a consultation today - and be confident that you are ready for 2027.