From 1 January 2022, the institution of the Polish Holding Company (PSH) was introduced into the Polish legal system. The regulation is addressed to Polish holding companies that have domestic or foreign subsidiaries. PSH is an alternative to the tax capital group (TCG) and exemptions within a special economic zone or the Polish Investment Zone.

Regulation in its current form is based on two pillars:

1) exemption from corporate income tax (CIT) of 95% of the dividend paid to the holding company by the subsidiary, and

2) full exemption from this tax of profits derived from the sale of shares in subsidiaries.

The remaining part of the dividend (5%) is currently not covered by the exemption under Council Directive 2011/96/EU, which means that it is subject to CIT in Poland on general principles at the rate of 19%.

Statutory requirements for the establishment of a PSH

The main condition for the creation of a PSH is that the holding company holds at least 10% of the shares in the subsidiary on the basis of the title deed for a minimum period of one year. Moreover, a holding company cannot benefit from the exemptions provided for in the CIT Act and must conduct "real activity" within the meaning of the provisions on controlled foreign companies. The legislator also provided for restrictions on the shareholders of the holding company.

Shares in PSH cannot be held directly or indirectly by a shareholder having its registered office or management board in a country applying harmful tax competition or in a country with which Poland or the European Union has not signed an agreement constituting the basis for the exchange of tax information.

A number of requirements have also been laid down for the subsidiary PSH. These include, the requirement not to hold more than 5% of shares in the capital of another company or not to use tax exemptions.

Doubts resolved in favour of the taxpayer

The provisions governing PSH raise some interpretation doubts, including possibility of introducing the PSH institution in the event of using the exemption from dividend taxation in previous years. However, tax authorities presented lately interpretation confirming that the use of the dividend exemption in previous years (before 1 January 2022) does not currently exclude the possibility of taking advantage of the new preference for holding companies. Moreover, the condition of not benefiting from the dividend exemption applies to the holding company and not to its partners. However, it remains an open question whether the "use" of the exemption should be examined in relation to the one tax year in which the sale of shares in the subsidiary takes place, or whether it should be checked whether the taxpayer has ever applied the exemption after 1 January 2022.

A positive change in the rules

On 20 June 2022, the list of legislative and programme works of the Council of Ministers announced the commencement of work on amendments to the in the scope of provisions concerning PSH. Clarification and improvement of the regulations is aimed at adapting the regulations for a larger circle of entrepreneurs, including:

  • granting the right to use by PSH the exemption from dividend taxation resulting from Council Directive 2011/96/EU,
  • enabling the domestic subsidiary to benefit from the exemption provided for the so-called Polish Investment Zone or special economic zone within PSH,
  • introduction of a full exemption from dividends compared to the current 95%.


The institution of the Polish Holding Company is an interesting alternative for investors interested in investing capital in Poland. Taking into account the favourable interpretations of tax authorities issued so far and the announced changes in the regulation of the functioning of PSH, the creation of a holding company is worth considering. If you are interested in this regulation, a team of tax, legal and financial experts from PKF will answer any questions.