Tax Glossary

Colloquial name for the 19% capital gains tax. The name comes from the former Finance Minister Marek Belka, who introduced this tax rate.

Fee charged by a broker for executing a transaction. Commissions are a cost of revenue and reduce taxable income.

Income earned from stock market investments, including profits from the sale of shares, ETFs, cryptocurrencies, and dividends. Taxed at 19% under PIT-38.

Costs incurred to generate revenue, including the cost of purchasing shares, broker commissions, and other transaction-related costs. These costs reduce taxable income.

In Poland, cryptocurrencies are treated as virtual currencies and are subject to taxation under PIT-38. Every sale, exchange, or use of cryptocurrency may generate income subject to 19% tax.

Positive difference between revenue from asset sale and acquisition cost. Capital gain is taxed at 19% under PIT-38.

Distribution of company profit to shareholders. Dividends are taxed at 19%, but the settlement method depends on whether they come from Polish or foreign companies.

Mechanism preventing the same income from being taxed in two countries. Poland has concluded double taxation avoidance agreements with many countries, allowing the deduction of tax paid abroad.

FIFO (First In, First Out) is an asset disposal valuation method meaning that when selling, shares purchased first are settled first. It is the only method allowed for tax purposes in Poland.

Dividends from foreign companies require self-reporting. They must be reported in PIT-38 along with the PIT-ZG attachment. Withholding tax (e.g., 15% in the USA) can be deducted from Polish tax.

The PIT-38 return must be filed by April 30 of the year following the tax year. For example, the return for 2026 must be filed by April 30, 2027.

Foreign currency exchange rate published by the National Bank of Poland. Used to convert transactions in foreign currencies to PLN for tax purposes. The rate from the day preceding the transaction.

Annual tax return used to report income from capital gains. A mandatory form for all Polish tax residents who earned income from stock market investments, sale of shares, ETFs, cryptocurrencies, or dividends.

Attachment to the annual tax return (e.g., PIT-38) used to report income earned abroad. It is required when an investor uses foreign brokers or receives dividends from foreign companies.

Negative difference between revenue and cost of revenue. A loss can be deducted from income in subsequent tax years.

Tax form for non-US residents. Completing the W-8BEN form allows reducing US dividend withholding tax from 30% to 15%.