I plan to settle in Poland, my situation is, I don't plan to work or earn money in Poland, so I don't care about the economic prosperity of the city, but I want to live in a city with more relax atmosphere, better natural environment, more traditional culture and nicer people. I like to travel worldwide, so I need to be close to major transportation hub, I also specifically like Ukraine and Russia, but right now I don't have residency of either of them and have no way to settle there, so Poland is as close I can to have similar feeling within EU. But I still want to access Ukraine and Russia easily and frequently from Poland. Although my ultimate goal is to master Russian language one day, I still need to learn Polish language while living in Poland, so the city should also have convenient facility for me to learn the language.
So far I have filtered my candidate city to Lublin, but I want some advises to make sure it's the best choice or maybe there are better choices I missed.
Maybe you misunderstood my post. I'm essentially planing to retire in Poland although I'm still very young and I have savings and income elsewhere. I don't understand why you think I would take advantage of Polish taxpayers as I will actually net contribute to Polish economy by bringing my money into Poland.
According to this, you never pay tax twice on same income from other EU countries in Poland. europa.eu/youreurope/citizens/work/taxes/income-taxes-abroad/poland/index_en.htm
According to this, you never pay tax twice on same income from other EU countries in Poland.
Yes, but if you are resident in Poland for more than 185 days a year, then you are tax resident in Poland. That means paying 18/32% of your income to Poland. You can get a tax credit for the tax paid to foreign tax authorities, but the tax free amount in Poland is very low.
And yes, they have access to foreign bank accounts.
Savings are not taxed in Poland. So in this respect he is right. He won't pay tax on the retirement money he brings here if he is an EU citizen. In fact it's probably just as easy to leave most of it in his home country bank.
Any interest or dividends earned will be taxed in Poland at 19 percent at the time they arise. In reality interest is more or less zero in most banks so nothing to get anxious about.
So, let's say you do some work for Polish Affairs Monthly in Chicago. You write a series of articles for them, and they send you a cheque for $500. You put it into your secret Swiss bank account, but you still need to declare it to the Urząd Skarbowy and pay Polish taxation on it.
cms - I assume he was planning to do the usual "work online, have foreign bank account and say nothing to the Polish taxman" deal. Stupid idea these days, especially since ZUS started combing social insurance databases.
@Ziemowit As I said, I like to travel, so I doubt I would be able to spend time in Poland more than 6 months a year to become tax-resident. Also there is UK/Poland double tax convention, income taxed in the UK is exempt from tax in Poland even one becomes tax-resident in Poland.
I choose Lublin because it's close to both Ukraine if I travel eastwards and Warsaw (if I travel worldwide). And it also has a lot of universities for me to learn the language. But I wish to hear if there are any better choices.
I also specifically like Ukraine and Russia, but right now I don't have residency of either of them and have no way to settle there, so Poland is as close I can to have similar feeling within EU.
I remember your posts from several months ago, and I told you then that Poland, even eastern Poland, is very different from Russia. Russian influence has been decreasing rapidly for almost thirty years now, and has all but disappeared. There is no sizable concentrated minority of Russians living in Poland, but there are in the Baltic countries: Lithuania, Latvia and Estonia, all of which border on Russia. You will find it a lot easier to learn Russian in these countries as it is one of the languages you will hear on the street everyday.
Also, Poland does not have retirement visas. You'll have to check whether the other countries I mentioned do.
Can you refresh my memory of why you are unable to settle in Russia, and why you think staying in the EU would be easier? I would have thought it would be the other way around?
He may choose not to become a tax resident in PL then.
Well, he can spend up to 182 days a year here without becoming tax resident, but if they deem your "centre of vital interests" to be in PL, then you have a tax liability regardless of the days spent here. Generally speaking though, if you have residency in a normal country (i.e., not some tax haven) and you document thoroughly your days in and out of PL, it's fine, just as long as you don't have a family or other circumstances in which they can claim you have residency in PL.
Also there is UK/Poland double tax convention, income taxed in the UK is exempt from tax in Poland even one becomes tax-resident in Poland.
Of course, but the UK tax free amount is significantly higher than the Polish one. You'll have to make the difference up to Poland. so you can effectively say that 18/32% of your work-related income is going to Poland.
As my savings and investment are all in the UK, there is UK/Poland double tax convention in place, so I would not be taxed in Poland no matter I'm tax-resident or not. I think the Convention also protects so many Polish making money in the UK to avoid being taxed again if they choose to go back to Poland.
Also the Convention says the taxed income in the UK is exempted to be taxed in Poland, not saying the tax paid in the UK can offset the tax in Poland in the form of tax credits.
The UK/Poland double tax agreement only means that you will get a tax credit for any taxes paid to the UK tax office while resident in PL. It doesn't stop Poland from claiming the difference in tax paid to the UK and the tax owed to Poland.
If you're going to be outside of Poland for more than 6 months a year while maintaining a residence there, then you need to thoroughly document what you're doing, preferably with receipts.
Why, then, Poland, and not Lithuania, Latvia or Estonia, countries that have sizable Russian minorities and border directly on Russia? If you're looking for a "Russian-like" lifestyle, I'm a bit confused why you think you would find it in Poland. Polish lifestyle is very different from Russia. The three countries I mentioned were all once part of the USSR. Poland never was. It's true that northeastern Poland was once part of the Russian Empire, but that was a hundred years ago. Poland did not absorb too much Russian cultural influence at that time, and what little it did absorb then and during communist times has largely disappeared. Even in Białystok, I saw the "Eastern European" practically disappear during my stay in Poland. There was a distinct "Eastern" feel when I first visited there in 2002, but that was all but gone when I last visited three years ago. Lublin has never felt "Eastern European" to me. It's solidly Polish, and Western.
Why, then, Poland, and not Lithuania, Latvia or Estonia, countries that have sizable Russian minorities and border directly on Russia?
I'd strongly suggest Narva in Estonia. Estonian is all but useless there for ordinary life, the city looks and feels Russian and you can easily get a multiple-visit visa to Russia from there. For the authentic Russian vibe, the twin town on the other side of the river, the Russian Ivangorod, is an absolute dive.
Lublin in comparison is useless, not least because of the huge amount of students.
I'm EU citizen so I don't need visa to retire in Poland. I never planed to learn Russian in Poland, only Polish in Poland. But I will travel very often to Ukraine and Russia to learn Russian. I feel Poland is most similar to Russia within EU overall more about the culture/values and people not the language. I've been to Baltics, the Russian community there is very segregated from main stream society, similar like China town in London, but the mainstream society is very different from Russia. Long term I wish to settle in Russia after mastering the language. As once the language barrel is cleared, there will be much more possibility to get Russian residency to settle in Russia. But right now, I think Poland is very good place as a bridge for my long term plan, and the geolocation is very good as a base hub to travel around the world.
I suggest you read the Convention carefully. Your were talking about the Polish income for UK resident, not the UK income for Polish resident. They are different.
Polish income for UK resident: "Polish tax payable under the laws of Poland and in accordance with this Convention, whether directly or by deduction, on profits, income or chargeable gains from sources within Poland (excluding in the case of a dividend, tax payable in respect of the profits out of which the dividend is paid) shall be allowed as a credit against any United Kingdom tax computed by reference to the same profits, income or chargeable gains by reference to which the Polish tax is computed."
UK income for Polish resident: "Where a resident of Poland derives income which, in accordance with the provisions of this Convention is taxed in the United Kingdom, Poland shall, subject to the provisions of sub-paragraph (b) of this paragraph exempt such income from tax."
"Where a resident of Poland derives incomewhich, in accordance with the provisions of this Convention is taxedin the United Kingdom, Poland shall, subject to the provisions of sub-paragraph (b) of this paragraph exempt such incomefrom tax."
In short, it only applies to income that has already been taxed. This means that you need to pay tax to Poland on the difference between the UK tax-free amount and the Polish tax-free amount.
UK tax free amount - 11,500GBP / 54500PLN. Polish tax free amount - 0PLN / 0GBP (but there are some allowances that you can claim, the "cost of earning income") That means that you need to pay 18% of the difference between 0 and 54500PLN.
As the text you've quoted above makes clear, you only have an exemption from earnings that were already taxed. The tax free amount is by nature tax free, which means that Poland wants her share of the cash.
If I were you, I'd seek the advice of a competent and qualified tax advisor, especially as Poland has access to British bank accounts.
If you are a resident of Poland (i.e. have your life interests there) you will NOT be allowed any tax-free allowances in the U.K..This is the cruncher. You must establish beyond a shadow of a doubt your 'residency'.
If you are a resident of the U.K. - i.e. have your life interests there, you can only stay in Poland for less than 183 days a year.
You must watch out also, that in the U.K. the tax year runs from April to April, but in Poland from January to December.
How does the tax situation affect any UK pensions that might be payable
There is a special section for tax liabilites for "Pensions and similar payments or annuities received" and here, the tax is only paid in the country where you are residing.
Hello, can you tell me which of these bigger 3 cities in Eastern Poland are good to live?
Lublin is the largest (and greenest - I love tree-lined streets!) but its population numbers are declining while Rzeszów seems to be growing. Why is that?
Białystok also seems to be increasing in population but at a more slower pace than Rzeszów.
In Rzeszow the population is growing because lots of Ukranians are settling there.Also there is huge new development going on.I use to be good at the streets there but with new roads its all new for me now.If I have to choose I will go for Rzeszow.Its developing has an beautiful new international airport.First time we flew there in 2000,they had a rented car waiting for us on the tarmac,ofcourse its not like that anymore but very good terminal with direct flights to NY by LOT.
Thank you, man! I hope the state or businesses start investing more in Eastern Poland as Warsaw is overcrowded. I know Western Poland has the benefit of being closer to Germany, but Eastern Poland could use its (relative) proximity to the Baltics and Finland. For example, a finnish company might be attracted somehow.
If your pension is a civil service pension then you will have it taxed in the UK....as others have said if you have a state pension from the UK it would be taxed in Poland.
