Lump sum, linear or scale - what to choose in JDG in 2026 — in Poland

The lump sum, flat tax and scale differ not only in the PIT rate. The company's costs, health insurance premium, available reliefs, joint settlement and the appropriate lump sum rate according to PKWiU are also important.

There is no one form that always wins. The comparison must be made on annual data and the same assumptions.

Three forms of JDG taxation

Tax scale

You pay tax on income, i.e. revenue less tax-deductible costs and other allowable deductions.

Highlights:

• 12% up to PLN 120,000 of the tax base,
• 32% on the surplus over PLN 120,000,
• free amount PLN 30,000,
• possibility of joint settlement with your spouse after meeting the conditions,
• access to reliefs settled on income or tax,
• health insurance contribution of 9% of income, with a monthly minimum.

Scale can be advantageous when income is lower, costs are high, joint filing or tax deductions. The second threshold does not mean that all income is taxed at 32% - the higher rate only applies to the excess over the threshold.

Flat tax

The tax is 19% of income regardless of its amount.

Highlights:

• income tax, so the costs reduce the tax base,
• no free allowance,
• as a rule, there is no joint settlement of business income with the spouse,
• health insurance contribution 4.9% of income, with a monthly minimum,
• the paid health insurance contribution can be settled within the annual limit applicable to the flat tax.

In 2026, the limit for settling health insurance contributions on a flat tax basis is PLN 14,100. This is not the maximum annual health insurance premium. If your income is high, the premium you pay may exceed this limit; the limitation applies to the amount included in costs or deducted from income.

Lump sum from recorded income

You pay tax on income after statutory deductions. You don't subtract normal company costs - such as car, equipment, materials or subcontractors - from the lump sum basis.

The rate depends on the actual activity performed and PKWiU. For example:

• 3% - including trade and catering services, except for the sale of beverages with alcohol content above 1.5%,
• 5.5% - including construction works and manufacturing activities,
• 8.5% - general service activities, unless the Act provides for a different rate,
• 12% - selected IT services,
• 14% - including health care and architectural and engineering services covered by the indicated groupings,
• 15% - selected services listed in the Act,
• 17% - independent professions within the meaning of the lump sum act.

The 2% rate is not the usual rate for trading. Applies to specific sales of plant and animal products processed in a non-industrial manner, after meeting statutory conditions.

A detailed list can be found in table of lump sum rates 2026.

Health insurance premium in 2026

Scale

The contribution is 9% of business income, not less than the monthly minimum. On the scale, you do not deduct it from your PIT or include it in tax-deductible costs.

Flat tax

The contribution is 4.9% of income, also with a monthly minimum. The limit of PLN 14,100 applies to the tax settlement of the contribution, not to its calculation.

A lump sum

The monthly contribution depends on the annual income reduced for the purposes of determining the threshold in accordance with the health contribution rules:

• up to PLN 60,000: PLN 498.35,
• over PLN 60,000 up to PLN 300,000: PLN 830.58,
• over PLN 300,000: PLN 1,495.04.

After the end of the year, an annual settlement of the contribution may be necessary if the final income places the entrepreneur in a different threshold than the one applicable during the year.

What really needs to be compared

1. Revenue and costs

With scale and a flat tax, costs reduce income. They do not reduce the tax base on a lump sum basis. Therefore, comparing rates alone - for example, 8.5% and 19% - is unreliable.

2. The appropriate flat rate

You do not choose the rate according to the company name or the PKD code entered in CEIDG. The basis is the actual scope of the benefit and its PKWiU classification.

If you perform several types of activities, they may be subject to different rates. The records must then allow for the allocation of revenues.

3. Health insurance premium

Include in the comparison:

• contribution of 9% of income on the scale,
• contribution of 4.9% of income for a linear employee,
• the appropriate lump-sum contribution threshold,
• method of tax settlement of contributions on a straight-line and lump-sum basis,
• monthly minimum contribution.

4. Discounts and family settlement

Scale can gain an advantage thanks to a tax-free amount, joint settlement or reliefs. Some deductions also apply to flat or lump sum tax, but the rules are different. For example, the thermal modernization relief can also be settled in PIT-28 - it is not reserved only for the scale and flat tax.

5. Losses from previous years

Switching to a lump sum payment does not automatically mean that the previous loss is "forfeited". The possibility of settling it depends on the source, period and applicable rules. However, it should not be treated in the same way as current costs, which are not deducted on a lump sum basis.

Example situations

Low cost service company

A lump sum payment may be beneficial if:

• the right rate is low,
• costs constitute a small part of revenue,
• the entrepreneur does not lose important preferences available on the scale.

First, however, the PKWiU must be confirmed. It's not always 8.5% for a programmer - many IT services are rated at 12%.

Construction company with large purchases of materials

A rate of 5.5% may look attractive, but the lump sum does not allow you to deduct the cost of materials. When materials and subcontractors make up a large portion of revenue, a scaled or flat tax may result in a lower total burden.

High income and low costs

A flat tax may be more favorable than a scale tax when a significant part of the income would fall into the second threshold. You still need to compare health benefits and the lack of tax-free allowance and joint settlement.

When can you change the form of taxation?

The declaration on the choice of a flat tax or a lump sum tax is generally submitted by the 20th day of the month following the month in which the first income was achieved in the tax year. If you achieve your first income in December, the deadline is at the end of the year.

For an entrepreneur who receives his first income in January, the usual deadline is therefore February 20, not January 20.

A change can be reported by updating the entry in CEIDG. Simply submitting an update does not remedy a late election.

Failure to effectively choose another form means, in principle, continuing the current form, and when starting a business without a choice - taxation at scale.

The most common mistakes

Comparison of percentages instead of annual amounts

The rate of 8.5% on income is not directly comparable to 19% on income.

Accepting an incorrect lump sum rate

PKD is used to describe activities in the register. It does not replace the PKWiU classification needed to determine the lump sum rate.

Recognition of PLN 14,100 as the health insurance contribution limit

This is the limit for the tax settlement of the straight-line contribution, not the maximum contribution to be paid.

Bypassing the minimum health insurance premium

If your income is low or at a loss on a scale and straight line, you may still face a monthly minimum premium.

Submitting the change on January 20 "because it has always been so"

The deadline depends on the month of the first income. The first arrival in January generally falls on February 20.

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