Two Sources of Income and the Tax-Free Allowance in Poland in 2026

Employed full-time and also running a sole proprietorship (JDG)? Or renting out an apartment and having a sole proprietorship? The tax-free allowance is 30 000 zł on the tax scale — but it applies once to all income sources combined, not separately for each. This is one of the most common misconceptions in PIT settlements.

We explain how the 30 000 zł tax-free allowance works with two income sources (Art. 27 ust. 1 of the PIT Act), which form to file on, and when it may be worth considering ryczałt or the flat rate instead of the tax scale.

The 30 000 zł tax-free allowance — basic rules

On the tax scale, the tax-free allowance is 30 000 zł per year (Art. 27 ust. 1 of the PIT Act, Dz.U. 2026 poz. 592 t.j.). Income up to this amount is not taxed. Above it, the 12% rate applies up to 120 000 zł and 32% on the excess.

The tax-reducing amount — 3 600 zł — results from converting 30 000 zł × 12%.

The tax-free allowance applies to the combined income from all sources taxed on the scale, not to each source separately.

The tax-free allowance vs. the flat rate and ryczałt

• Flat rate (19%) — the tax-free allowance does not apply. The flat tax is calculated from the first złoty of income (Art. 30c ust. 1 PIT).
• Ryczałt — ryczałt is governed by a separate act; the tax-free allowance from the PIT Act does not apply. Tax is calculated on revenue without a tax-free allowance.
• Private rental under ryczałt — ryczałt on rental is also without a tax-free allowance.

Employment + sole proprietorship on the tax scale — how it works

The most common scenario: employment and business activity, both on the tax scale. You report income from both sources together on PIT-36.

Calculation

1. You sum employment income (after deducting employment-related income-earning costs — 250 zł/month or 300 zł for work outside your place of residence),
2. You sum sole proprietorship income (revenue minus KUP minus social ZUS contributions),
3. You subtract ZUS and health contributions from the combined income,
4. You reduce the combined income by the 30 000 zł tax-free allowance (only once, not 2 × 30 000 zł),
5. You calculate the tax on the excess: 12% up to 120 000 zł, 32% above.

Example

Employment: 80 000 zł/year (gross, after income-earning costs of 3 000 zł = income 77 000 zł) Sole proprietorship on the scale: income 40 000 zł (revenue 100 000 zł minus KUP 50 000 zł minus social ZUS 10 000 zł)

• Combined income: 77 000 + 40 000 = 117 000 zł
• Health contribution 9%: 0,09 × 117 000 = 10 530 zł
• Income after health contribution: 117 000 − 10 530 = 106 470 zł
• Tax-free allowance: 30 000 zł
• Tax base: 106 470 − 30 000 = 76 470 zł
• Tax: 76 470 × 12% = 9 176 zł
• To pay (minus advances withheld by the employer and paid from the sole proprietorship)

Mistake: "I have 30 000 zł tax-free from employment and 30 000 zł from the sole proprietorship" — incorrect. The tax-free allowance applies once to combined income.

Employment + sole proprietorship under ryczałt

If the sole proprietorship is under ryczałt and employment on the scale:

• You settle employment on the scale (with the 30 000 zł tax-free allowance),
• You settle the sole proprietorship under ryczałt (without a tax-free allowance),
• You file two separate returns: PIT-37 (employment) and PIT-28 (ryczałt),
• The 30 000 zł tax-free allowance works only on PIT-37.

In this setup, ryczałt can be advantageous because a low rate (e.g., 3% for trade, 8,5% for care services) may produce less tax than the scale — even without a tax-free allowance.

Employment + sole proprietorship on the flat rate

If the sole proprietorship is on the flat rate (19%) and employment on the scale:

• You settle employment on the scale (with the 30 000 zł tax-free allowance),
• You settle the sole proprietorship at the flat 19% rate (without a tax-free allowance),
• You file two separate returns: PIT-37 (employment) and PIT-36L (flat rate).

The flat rate makes sense at high sole proprietorship income levels (above 120 000 zł), where the 32% bracket on the scale would cost more than the 19% flat rate.

Private rental + sole proprietorship

Private rental can be taxed on the scale (PIT-36) or under ryczałt (PIT-28).

Rental on the scale + sole proprietorship on the scale

Rental and sole proprietorship income are combined on PIT-36. The 30 000 zł tax-free allowance applies to combined income. Rental costs (depreciation, renovations, utilities — if they relate to the rented premises) reduce rental income.

Rental under ryczałt + sole proprietorship on the scale

You settle rental under ryczałt (PIT-28, rate 8,5%) and the sole proprietorship on the scale (PIT-36). The tax-free allowance works only on PIT-36. Two separate returns.

Joint settlement and two income sources

In a joint settlement with a spouse (Art. 6 ust. 2 PIT), both spouses' incomes are combined and split in half. The tax-free allowance effectively "doubles" — because each spouse gets 30 000 zł tax-free, so combined income up to 60 000 zł is not taxed.

But note: if either of you has a sole proprietorship on the flat rate or ryczałt, joint settlement is not possible.

When to consider ryczałt instead of the scale

With two income sources, ryczałt can be advantageous when:

• sole proprietorship costs are low (services, trade),
• the ryczałt rate is low (2% online trade, 3% general services, 8,5% care services),
• employment already uses up the tax-free allowance and the 12% bracket,
• sole proprietorship revenue is high but costs are low.

On the scale, you must calculate tax on full income (revenue minus costs). Ryczałt is calculated on revenue — without costs, but also without a tax-free allowance.

Pitfalls

1. Double tax-free allowance — does not apply. 30 000 zł once on combined income from the scale.
2. Employment advances vs. sole proprietorship advances — the employer withholds advances from employment, but from the sole proprietorship you must pay your own advances. Everything balances out in the annual return.
3. Health contribution on combined income — on the scale, the health contribution is 9% of income from all sources combined.
4. The flat rate has no tax-free allowance — it is not "a 19% scale." The flat rate charges 19% from the first złoty.
5. The tax-free allowance vs. PIT-0 for young people — these are two different mechanisms. PIT-0 (85 528 zł) applies only to employment/mandate contracts. The 30 000 zł tax-free allowance applies to the scale, including sole proprietorship income.

FAQ

Does the tax-free allowance apply separately to employment and to a sole proprietorship?

No. On the tax scale, the 30 000 zł tax-free allowance applies to combined income from all sources taxed on the scale, summed on PIT-36.

Is there a tax-free allowance under the flat rate?

No. The 19% flat tax is calculated from the first złoty of income, without a tax-free allowance (Art. 30c ust. 1 PIT).

Is there a tax-free allowance under ryczałt?

No. Ryczałt is governed by a separate act and does not provide for a tax-free allowance.

Are the tax-free allowance and the PIT-0 relief the same?

No. The 30 000 zł tax-free allowance is an element of the tax scale (it reduces the tax base). PIT-0 (85 528 zł) is an exemption for specific types of income (employment, mandate contracts) for people under 26 — it does not apply to sole proprietorships.

Can I settle employment on PIT-37 and the sole proprietorship on PIT-36?

If the sole proprietorship is on the scale, you settle everything on a single PIT-36 (employment + sole proprietorship combined). You file PIT-37 only if you have no sole proprietorship or other sources requiring PIT-36.

Sources

• PIT Act — Art. 27 ust. 1 and Art. 6 (Dz.U. 2026 poz. 592 t.j.)
• podatki.gov.pl — Tax-free allowance and PIT rates
• podatki.gov.pl — Joint settlement for married couples

Need help choosing your form of taxation?

Oxyok handles sole proprietorship accounting on the tax scale, flat rate, and ryczałt — from 49 zł + VAT per month. We'll help you check which form is most advantageous given your income sources.

Write to Paweł or see Oxyok's accounting services.

This material is for informational purposes. Choosing a form of taxation requires an analysis of your individual situation.