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Who can receive a relief of PLN 402 per month?
. The benefit is granted to all who, after reaching retirement age, do not intend to retire and want to continue employment. This solution has been functioning in the Polish tax system for several years and is commonly called relief for working seniors.
Pursuant to art. 21 para. 1 point 154 of the Act of 26 July 1991 on personal income tax ,. The condition is to be subject to social insurance for obtaining these revenues and not to collect a pension or survivor’s pension despite the acquisition of rights.
The solution was introduced in response to adverse demographic changes – In an aging society, there are no hands to work. Although the best solution for the economy would be to raise the retirement age, such a reform does not seem, so people expecting pensions have nothing to fear.
Will remain on the labor market and further paying contributions allows you to earn a higher pension. However, this process is slow-the difference in the amount of the benefit is about 10-15 percent. for every year of further work. Therefore, tax relief may be a greater incentive to make a decision to continue employment despite reaching retirement age.
Conditions for using the relief for seniors
An employee who decides to stay on the labor market is given to a relief for working seniors despite the acquisition of retirement rights. It is which can be used by any taxpayer after meeting the following conditions at the same time:
- reaching a retirement age of 60 for women and 65 years old for men,
- further work with paying contributions,
- not taking pension benefits despite the acquisition of the rights to such benefits due to age.
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Mechanism of the relief for the senior
The relief is to exempt from personal income tax certain taxpayers who, despite reaching the universal retirement age, still remain professionally active. The condition is to be subject to social insurance for obtaining these revenues.
Working seniors are people who are still working despite reaching the universal retirement age (60 years old, 65 years old men). They settle on the same terms as working people who do not receive a pension, but are entitled to a relief for working seniors. Tax preference consists in exempting revenues from PIT to PLN 85,528. If the relief limit is exceeded, tax -free tax -free amounts of PLN 30,000 shall apply to taxable income according to the tax scale.
You can take advantage of the relief if you are a woman over 60 or a man over 65, and in addition, despite the acquisition of the right, you do not receive:
- pensions or survivors’ pension from ZUS,
- pensions or survivors’ pension from KRUS,
- pensions or survivors’ pensions from uniformed insurance systems,
- cash benefits in connection with the exemption from the permanent service of a uniformed service officer,
- the salary of resting or family salary.
If the senior exceeds the limit for a discount of PLN 85,528, the excess revenue is taxable on general principles.
Specific amounts of financial benefits
The amount of benefits depends primarily on the amount of earnings, the use of tax deductible costs and the amount reducing tax. However, the calculations show that it is about PLN 402 per month. Revenue of PLN 85,528 per year is exempted.
If you accept the average salary of PLN 7.127 gross, the paid salary without a relief is PLN 5,188.39. After applying the relief for the senior, this amount increases to PLN 5,590.39 per month, so the difference is PLN 402 per month – constituting a real financial incentive to continue work.
