Estonian CIT in Poland in 2027: who qualifies and does it pay off

Estonian CIT (ryczałt od dochodów spółek, the lump-sum tax on company income) pays off for a company that employs at least 3 people who are not shareholders, has only individuals as shareholders and keeps most of its profit in the business. A small company pays 10% only on profit it distributes, and according to the Ministry of Finance example the combined burden on the company and the shareholder is 20%, against 26.29% under standard 9% CIT plus a dividend.

Law as of 9 October 2026.

If your company's tax year is the calendar year and you want to switch to the lump-sum tax from 2027, you file the ZAW-RD notification by 31 January 2027.

How Estonian CIT works

Under standard CIT the company pays tax on its income every year, even when the profit stays in the business. Under the lump-sum tax, tax arises only when profit leaves the company: when a dividend is paid, through hidden profits, or through expenses unrelated to the business (art. 28m ust. 1 ustawy o CIT, the Corporate Income Tax Act). The base is the net profit from the accounting books, not taxable income. The company pays no monthly advances, because the payment deadlines are tied to the distribution of profit (art. 28t ust. 1 ustawy o CIT).

You choose the lump-sum tax for 4 consecutive tax years. The period renews automatically for another 4 years unless you opt out in the return for the last year (art. 28f ust. 1 i 2 ustawy o CIT).

Conditions: who can choose the lump-sum tax

The company must meet all of these conditions (art. 28j ust. 1 ustawy o CIT):

1. It operates as a sp. z o.o. (limited liability company), a simple joint-stock company, a joint-stock company, a limited partnership or a limited joint-stock partnership, and all its shareholders are individuals.
2. Less than 50% of its revenue from the previous year comes from passive sources: interest, receivables, copyrights, financial instruments, or transactions with related parties that create no added value.
3. It employs at least 3 people on employment contracts (full-time equivalents) who are not shareholders, for at least 300 days a year. Alternatively, it pays at least 3 non-shareholders each month under other contracts, in a total of at least three times the average wage in the enterprise sector.
4. It holds no shares in other companies and no units in investment funds.
5. It does not prepare financial statements under IFRS.
6. It files the notification of the choice by the end of the first month of the first tax year under the lump-sum tax.

For 2026 the threshold in point 3 is 26,563.83 zł a month, which is 3 × 8,854.61 zł. That is the average wage in the enterprise sector for Q3 2025 (art. 28c pkt 2a ustawy o CIT; notice of the President of Statistics Poland, M.P. 2025 poz. 1118). The 2027 threshold will follow from the wage for Q3 2026, which Statistics Poland has not yet announced.

The employment condition is softer in two cases:

• A small taxpayer in its first lump-sum year needs only 1 full-time employee, or payments to 1 person of at least one average wage (art. 28j ust. 3 ustawy o CIT).
• A new company does not have to meet the condition in its start-up year and the 2 following years, but from the second year it must add at least 1 full-time job each year (art. 28j ust. 2 pkt 2 ustawy o CIT).

You cannot choose the lump-sum tax, among other cases, in liquidation, in bankruptcy, or for 24 months after a business or assets worth more than 10,000 euro were contributed to a new company (art. 28k ust. 1 ustawy o CIT). The company keeps full accounting books in a way that separates profits from lump-sum years in its equity (art. 28d ustawy o CIT).

Rates and the shareholder PIT credit

The lump-sum rates are set in art. 28o ust. 1 ustawy o CIT. A small taxpayer (mały podatnik) is a company whose sales revenue including VAT in the previous year did not exceed 2 million euro, which is 8,517,000 zł in 2026 (art. 4a pkt 10 ustawy o CIT). The shareholder pays 19% PIT on the dividend (art. 30a ust. 1 pkt 4 ustawy o PIT, the Personal Income Tax Act) and reduces it by 90% or 70% of the lump-sum tax paid on their share of the profit (art. 30a ust. 19 ustawy o PIT). The company withholds this PIT as the payer (art. 41 ust. 4 ustawy o PIT).

When you pay the tax

Payment deadlines are set in art. 28t ust. 1 ustawy o CIT:

• lump-sum tax on a dividend: by the end of the third month of the year after the year of the profit distribution resolution;
• lump-sum tax on hidden profits and on expenses unrelated to the business: by the 20th day of the month after the month of the payment or expense;
• lump-sum tax on undisclosed business transactions: by the end of the third month of the year after the year in which they should have been booked.

You file the CIT-8E return electronically by the end of the third month of the year for the previous year (art. 28r ust. 1 i 2 ustawy o CIT). Each shareholder gives the company a statement listing entities in which they hold at least 5%, by the end of the first month of each lump-sum year (art. 28s ust. 1 ustawy o CIT).

Hidden profits: the main risk

A hidden profit (ukryty zysk) is any benefit for a shareholder or a related party that results from the right to share in profit and is not a dividend (art. 28m ust. 3 ustawy o CIT). The Act lists, among others:

• a loan the company grants to a shareholder;
• interest on a shareholder's loan to the company;
• the excess of a transaction's market value over the agreed price in a deal with a shareholder;
• gifts and entertainment expenses.

You pay lump-sum tax on a hidden profit monthly. The credit in art. 30a ust. 19 ustawy o PIT applies only to dividends from distributed profit. A shareholder's pay for work is not a hidden profit up to five times the company's average salary, but no more than five times the average wage in the enterprise sector (art. 28m ust. 4 pkt 1 ustawy o CIT). In 2026 that upper limit is 44,273.05 zł a month. For a car also used privately, 50% of the costs fall under the lump-sum tax (art. 28m ust. 4 pkt 2 i ust. 4a ustawy o CIT).

Comparison: Estonian CIT and standard CIT

A small company has a profit of 200,000 zł for the year. The calculation below follows the Ministry of Finance example for a full payout of profit to one shareholder.

The gap grows when profit stays in the company. Under standard CIT you pay 18,000 zł for that year straight away. Under the lump-sum tax the tax is 0 zł until profit leaves the company.

The lump-sum tax usually does not pay off in three cases:

• The company does not employ 3 non-shareholders and does not plan to.
• The shareholder takes money out mainly through loans or benefits that would become hidden profits.
• The company has losses from before the lump-sum period. Profit allocated to cover them is subject to the lump-sum tax (art. 28m ust. 1 pkt 1 lit. b ustawy o CIT).

You can check the monthly cost of running a company, including the shareholder's ZUS and bookkeeping, in the company cost calculator.

How to switch to the lump-sum tax from 2027

1. Check the conditions of art. 28j ust. 1 ustawy o CIT against your 2026 data: passive revenue, employment and shareholder structure.
2. Set up employment that will meet the condition throughout 2027.
3. File the ZAW-RD notification with the head of your tax office by 31 January 2027 (art. 28j ust. 1 pkt 7 ustawy o CIT).
4. Collect the shareholders' statements on holdings in other entities by 31 January 2027 (art. 28s ust. 1 ustawy o CIT).
5. Settle 2026 under standard CIT in the CIT-8 return.

A late notification means the lump-sum tax does not apply for that year. If you are only setting up a company, see how to start a sp. z o.o..

Leaving the lump-sum tax

A company leaves the lump-sum tax in two ways (art. 28l ust. 1 ustawy o CIT):

• It opts out in the CIT-8E return for the last year of the 4-year period.
• It loses the right when it stops meeting the conditions. For the passive revenue and employment conditions, it loses the right at the end of the year in which it failed them. For the other conditions, it loses it at the end of the previous year.

After leaving, the company pays lump-sum tax on undistributed profit from the lump-sum years. It can pay it with each later distribution, or in one payment by the end of the third month of the year after the last lump-sum year (art. 28t ust. 1 pkt 2 i ust. 2 ustawy o CIT). When a company loses the right, it can choose the lump-sum tax again only after 3 tax years, and no earlier than after 36 months (art. 28l ust. 2 ustawy o CIT).

What may change in 2027: Sejm print no. 3137

The government bill amending the PIT and CIT Acts (Sejm print no. 3137) reached the Sejm on 24 September 2026. The first reading took place on 6 October 2026, and the bill went to the Public Finance Committee. It is a bill, not law in force. The planned entry into force is 1 January 2027. For Estonian CIT the bill provides for:

• ending the option to choose the lump-sum tax during a tax year (repeal of art. 28j ust. 5 ustawy o CIT);
• allowing pay under employment contracts and other contracts to be combined for the threshold of three times the average wage (new art. 28j ust. 1 pkt 3 lit. b);
• a clarification that a benefit is a hidden profit even when profit from before the lump-sum period funds it (art. 28m ust. 3);
• a definition of expenses unrelated to the business (new art. 28m ust. 3a);
• a presumption that a payout after leaving the lump-sum tax comes from lump-sum profit, unless the resolution names profit from before the lump-sum period (new art. 28h ust. 4).

The tax package bill in print no. 3147 (22% CIT for revenue above 50 million euro) amends art. 19 ustawy o CIT, which a company on the lump-sum tax does not apply (art. 28h ust. 1 ustawy o CIT).

Frequently asked questions

Can a single-shareholder sp. z o.o. switch to Estonian CIT?

Yes, if the sole shareholder is an individual and the company meets the employment condition. The shareholder does not count towards the 3 full-time jobs, because the employees may not be shareholders (art. 28j ust. 1 pkt 3 ustawy o CIT).

When must I file ZAW-RD to use the lump-sum tax from 2027?

By the end of the first month of the first lump-sum year, which is 31 January 2027 when the tax year is the calendar year (art. 28j ust. 1 pkt 7 ustawy o CIT).

Does a company on Estonian CIT pay advances?

No. The company pays lump-sum tax only on distributed profit, and on hidden profits and non-business expenses by the 20th day of the following month (art. 28t ust. 1 ustawy o CIT).

What is the combined tax on a dividend payout?

According to the Ministry of Finance example, 20% for a small taxpayer and 25% for other companies. Under standard CIT with a dividend it is 26.29% and 34.39%.

Is a shareholder's salary a hidden profit?

Not up to the limit. The limit is five times the company's average salary, but no more than five times the average wage in the enterprise sector, which is 44,273.05 zł a month in 2026 (art. 28m ust. 4 pkt 1 ustawy o CIT).