Home office Poland: Not a permanent establishment of a foreign company
Foreign companies employing remote workers in Poland do not establish a permanent establishment through their home offices. This means that these companies do not have to pay taxes in Poland on income from this source. This is the result of a verdict by the Polish Supreme Administrative Court. The Ecovis experts comment on the ruling of 28 October 2025 (Case no. II FSK 163/23).
The facts of the case
A company that is a legal entity (Ltd) with its registered office in Germany has an employment contract with natural persons residing in Poland and holding Polish citizenship. These employees are employed in administrative positions and perform their work in Poland on a remote basis. The employees perform only administrative tasks, including
- support in the configuration of technical solutions
- creation of projects in internal systems
- planning and acquisition of resources necessary to provide services
- generation of forms
- coordination of the preparation of printed materials
The employees are required to work from their place of residence (home office). They use computer equipment provided by the company to perform their tasks. The company does not have any address and does not have any rights to any real estate in Poland.
“We will assess for you whether your planned business activity in Poland constitutes a permanent establishment.”
Hubert Kaczyński, Tax Advisor, ECOVIS Poland, Warsaw, Poland
Double taxation treaties
In accordance with double taxation agreements concluded by Poland with other countries, profits of an enterprise of a contracting state shall be taxable only in that state, unless the enterprise carries on business in the other contracting state through a permanent establishment situated therein. If the enterprise does business in this manner, the profits of the enterprise may be taxed in the other state, but only to the extent that they are attributable to that permanent establishment.
What did the court rule?
In the opinion of the court, a permanent establishment is not created in Poland because the company
- will not have a fixed place of business in Poland (due to the company’s inability to use employees’ living space)
- will not sell goods/services in Poland (through Employees)
- all relevant aspects of sales, in particular the setting of prices and individual terms and conditions of contracts in the form of price reductions, will be carried out from Germany
- employees will only carry out administrative processes
Moreover, a constitutive feature of a permanent establishment is that it conducts all or part of a company’s business activity, except that this activity cannot be of an auxiliary or preparatory nature.
In the opinion of the court, in the case in question, the activities of the employees are precisely of an auxiliary and preparatory nature, as they are not identical to the core business of the company. In addition, the company does not have a fixed place of business in Poland.
This is not the first ruling of this type. A similar position was expressed by the Supreme Administrative Court in its judgment of 19 February 2025 (ref. no. II FSK 609/22).
