As a rule, the method of determining tax residence is specified by tax acts and international double taxation conventions. However, the outbreak of war in Ukraine has made it necessary to temporarily modify the principles for determining tax residence. Polish tax provisions allow persons who have come to Poland in connection with the hostilities in Ukraine to submit a declaration of having tax residence in Poland.
1. Tax residence
The key issue for the correct settlement of taxes is for the taxpayer to determine where he/she has tax residence and, therefore, where he/she is obliged to pay tax. For this reason, tax residence is very often referred to as “tax citizenship”.
The condition for obtaining tax residence in a given country is to have a centre of vital interests there or to stay in its territory for longer than 183 days.
When assessing whether a person has a centre of vital interests in a given country, it’s necessary to examine how strong personal and economic ties connect him/her to that State. Indeed, the centre of family interests is located in the country where this person has family, acquaintances and friends, conducts gainful and cultural activities, as well as manages his/her property.
When determining the period of 183 days of stay in a given State, it’s necessary to take into account all days of physical presence of the person concerned in that country, including weekends, holidays, periods of illness and leaves.
The Polish Personal Income Tax Act of 26 July 1991 (i.e. Official Journal of 2025, item 163, as amended), hereinafter referred to as the Act, defines tax residence in the manner described above. It results from the provison of Article 3(1) of the Act that an individual is considered as a person residing in the territory of the Republic of Poland if:
- he/she has a centre of personal or economic interests (centre of vital interests) in Poland either
- he/she stays in the territory of this country for more than 183 days in a tax year.
A person with Polish tax residence is subject to unlimited tax liability. In other words, he/she is liable to taxation of all his/her income (revenue) regardless of the location of sources of revenue (Article 3(1) of the Act). A person who doesn’t have Polish tax residence is obliged to pay tax in Poland only on income (revenue) earned in the territory of this country. This is the so-called limited tax liability (Article 3(2a) of the Act).
The certificate of residence constitutes the document confirming tax residence.
2. Determination of tax residence based on the double taxation convention concluded between Poland and Ukraine
The Convention between the Government of the Republic of Poland and the Government of Ukraine for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital, drawn up in Kyiv on 12 January 1993 (OJ 1994, No 63, item 269, as amended), hereinafter referred to as the Convention, establishes the principle according to which a person has tax residence in the country where he/she is subject to taxation because of his/her domicile, place of permanent stay, the head office of the management board or other criterion of a similar nature. However, this doesn’t concern situations where the tax liability in a given State arose in connection with income obtained only in that country or property located there. In the event that, after applying the presented rule, it turns out that a natural person has a place of residence in both States Parties to the Convention, his/her status will be determined as follows:
a) a person is deemed to have his/her domicile in the country where he/she has a permanent place of residence, and if he/she has a permanent place of residence in both States, he/she shall be deemed to have his/her domicile in the country with which his/her personal and economis ties are closer (centre of vital interests);
b) if it isn’t possible to determine in which State a person has a centre of vital interests, or if he/she doesn’t have a perrmanent residence in any country, he/she is deemed to be domiciled in the State where he/she usually stays;
c) if a person habitually stays in both countries or in neither of them, he/she will be considered domiciled in the State of which he/she is a citizen;
d) if he/she is a citizen of both countries or of neither of them, the competent authorities of the States concerned will settle the issue in question by mutual agreement.
3. Determination of tax residence based on a declaration of Polish tax residence
Due to the outbreak of war in Ukraine, a large number of people have arrived to Poland from the areas affected by military operations. In principle, the above-described rules for determining tax residence apply to them. However, the Polish legislator decided to introduce a simplification in obtaining Polish tax residence. According to the wording of Article Article 52 zr of the Act, in the current version, in the case of natural persons referred to in Article 1(1 and 3) of the Act of 12 March 2022 on assistance to citizens of Ukraine in connection with the armed conflict in the territory of that country, the fulfillment of the condition specified in Article 3(1) during the period from 1 January 2024 to 31 December 2025 is established on the basis of a written declaration of that person on having a centre of personal or economic interests (centre of vital interests) in the territory of the Republic of Poland.
It is clear for the cited provision that the described entitlement may be exercised by a strictly defined group of persons, i.e. persons referred to in Article 1(1 and 3) of the Act of 12 March 2022 on assistance to citizens of Ukraine in connection with the armed conflict in the territory of that country (i.e. OJ 2024, item 167, as amended), hereinafter referred to as the Act on assistance to citizens of Ukraine. This concerns Ukrainian nationals who came to Poland from the territory of Ukraine due to the hostilities there, as well Ukrainian citizens with the Pole’s Card who came to the Republic of Poland together with their immediate family due to the war operations. The term 1(1 and 3) used in Article 1(1) the Act on assistance to citizens of Ukraine also includes persons without Ukrainian citizenship, i.e. the spouse of a citizen of Ukraine, a minor child of a citizen of Ukraine, a minor child of the spouse of a citizen of Ukraine, provided that they came to Poland from the territory of Ukraine in connection with the military operations conducted in Ukraine and they aren’t Polish citizens or citizens of other countries than EU Member States.
The declaration referred to in Article 52 zr of the Act can’t be submitted by persons to whom the provisions of the Act on assistance to citizens of Ukraine don’t apply.
If the entitled person submits to the payer the declaration referred to in Article 52 zr of the Act, he/she should be treated as a Polish tax resident from the first day of his/her stay in Poland. In the event that he/she doesn’t present the declaration in question, he/she will be able to be treated as a Polish tax resident only after fulfilling one of the conditions listed in Article 3(1) of the Act.
4. Legal notice
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