Poland: R&D Incentives Under New Rules From 2017

Last Updated: 8 September 2017
Article by Joanna Prokurat

R&D relief was included in Poland's income tax law from 1 January 2016. A year later, under the "Small Innovation Act," major changes were introduced to make the incentives more attractive.

R&D relief in 2016

The mechanism for the R&D write-off was that a taxpayer conducting research and development activity had a right to take an additional deduction from the tax base for PIT or CIT for R&D costs.

The relief covered expenditures on the following activity:

  1. Research and development activity—i.e. creative activity including scientific research or development work undertaken systematically with the aim of increasing knowledge resources and their exploitation for creation of new applications
  2. Development work—i.e. acquiring, combining, shaping and exploiting currently available knowledge and skills in the field of science, technology and business, other knowledge and skills for planning production, as well as design and creation of new, updated or improved products, processes or services (excluding work on routine and periodic changes in products, production lines, manufacturing processes, existing services, or other operations in process, even if such changes are improvements), and more specifically:
    1. Development of prototypes and pilot projects, as well as demonstration, testing and validation of new or improved products, processes or services in an environment modelling actual operating conditions, where the main aim of the development is further technical improvement of products, processes or services whose final shape has not yet been determined
    2. Development of prototypes and pilot projects that may be used for commercial purposes, when the prototype or pilot project constitutes a ready-to-use end commercial product but it would be too costly to produce exclusively for demonstration and validation purposes.

A specified percentage of costs incurred on R&D activity (qualified costs) was subject to deduction from the tax base, depending on the size of the taxpayer and the category of costs. The following could be deducted as qualified costs:

  1. Salary and employer-paid social insurance premiums of staff employed for realisation of R&D activity
  2. Acquisition of goods and raw materials directly connected with R&D activity
  3. Expert opinions and reports, advisory or similar services, as well as acquisition of the results of research conducted under contract by a research unit for the purposes of R&D activity
  4. Paid use of scientific and research apparatus exclusively for R&D activity (but not under a contract with an affiliate of the taxpayer)
  5. Amortisation of fixed assets and intangibles used in R&D activity, apart from passenger cars and sepa-rately owned buildings, premises and structures.

In the case of qualified salary costs, an additional 30% deduction could be taken regardless of the taxpayer's size. In the case of the other qualified costs listed above, the additional deduction was 20% for micro, small and medium-sized taxpayers or 10% for large taxpayers.

Two types of costs were excluded from R&D relief:

  1. Costs reimbursed in any form
  2. Cost incurred by an enterprise which in the given year conducted activity in a special economic zone on the basis of a permit to operate in the zone (regardless of whether the permit covered R&D activity).

Deductions from the tax base for R&D relief could be taken over 3 successive years, if in the year when the taxpayer became entitled to take the deduction it generated a loss or did not earn enough profit to take full advantage of the deduction.

Major changes from 2017

From 2017, lawmakers have introduced a number of changes in the functioning of R&D relief which should make the incentives more attractive. In particular, the changes should increase the financial effectiveness of the relief for entities conducting R&D activity, and thus contribute to increased competitiveness of the Polish tax system in this area.

Some of the changes apply to micro enterprises and SMEs, while some affect all taxpayers regardless of size.

The changes should make R&D incentives more attractive as more and more taxpayers take advantage of additional deductions for R&D expenditures.

We outline the new regulations below.

Expanded catalogue of qualified costs

Under the amendment to the regulations on R&D relief, the catalogue of qualified costs is expanded. In addition to the previous items, qualified costs now include costs of obtaining and maintaining rights to patents, utility models, and industrial designs, incurred for:

  1. Preparation of registration documentation and filing for registration with the Polish Patent Office or equivalent foreign authority, including translation costs
  2. Conducting proceedings before the Patent Office or foreign equivalent, from the time of filing, including official fees and costs of legal representation and adjudication
  3. Defending against objections of failure to meet the conditions for registration of a patent, utility model or industrial design, during or after the registration proceeding, including costs of legal representation and adjudication, before the Patent Office or foreign equivalent
  4. Periodic fees, renewal fees, translations and other measures necessary for issuance or maintenance of rights to a patent, utility model or industrial design, including more specifically the costs of validation of a European patent.

But this expanded range of qualified costs is limited in terms of the entities that may take advantage of it. Only SMEs are entitled to claim qualifying costs for obtaining and maintaining industrial property rights.

Increase in level of qualified costs

From 2017, the limits on deduction of qualified costs for large taxpayers and SMEs are significantly increased. SMEs conducting R&D activity are entitled to deduct 50% of qualified costs as R&D relief. Large enterprises are entitled to deduct 50% of qualified costs for salary and social insurance contributions and 30% of other qualified costs.

Extension of deduction period

From 2017, the period for carrying forward R&D relief if the taxpayer is unable to take a full write-off in the tax year when the qualified cost is incurred is extended to 6 years.

Cash tax refund

An entirely new solution is the possibility to obtain a cash refund equal to the deduction for qualified costs in the case of taxpayers who generate a loss or income insufficient to take the full deduction. This right is available to all taxpayers in their first year of operation as a new enterprise, or SMEs in their first or second year.

Taxpayers are not eligible to take advantage of the preference for newly launched taxpayers (regardless of their size) if they are created:

  1. As a result of a reorganisation, merger or division of taxpayers
  2. As a result of conversion of the business form of a sole trader or partnership without legal personality
  3. By legal or natural persons or units without legal personality who have contributed to the new taxpayer's share capital an enterprise previously conducted by them, organised part of such enterprise or assets of such enterprise with a fair market value exceeding the equivalent of EUR 10,000 (at the National Bank of Poland rate from the first business day of October of the year preceding the tax year in which the contribution is made, rounded to the nearest PLN 1,000), or
  4. By legal or natural persons or units without legal personality making in-kind contributions to the share capital of the taxpayer of property obtained by them from liquidation of other taxpayers, if they held shares in the liquidated taxpayers.

In addition, such cash refund has to be repaid to the tax authority if the taxpayer enters bankruptcy or liquidation within the following 3 tax years.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.