🧾 Introduction
Investing in ETFs (Exchange-Traded Funds) through foreign platforms like Revolut, eToro, or Interactive Brokers is a great way to grow your wealth. However, tax season in Poland can quickly turn that excitement into confusion.
Unlike Polish brokerage houses, foreign brokers often don't provide a PIT-8C form. This means you are legally required to calculate and declare your capital gains and dividends manually on the PIT-38 form.
Don't worry—it’s less intimidating than it sounds. This guide explains, in simple terms, how to:
- Calculate your profit or loss from selling ETFs.
- Declare dividend income properly.
- Apply the correct NBP exchange rate for every transaction.
- Calculate the 19% capital gains tax accurately.
🧩 The Basics: How Poland Taxes ETFs
When you invest in ETFs, you typically generate two types of taxable income. Both go onto the PIT-38 form, but they live in different sections:
- Capital Gains (Zyski Kapitałowe): Money you make when you sell an ETF for more than you bought it.
- Where to put it: Part C of PIT-38.
- Dividends (Dywidendy): Cash payments distributed by the ETF to shareholders.
- Where to put it: Part G of PIT-38.
Crucial Rule: You must declare these amounts in PLN (Polish Złoty), regardless of whether your account is in EUR, USD, or GBP.
🧮 Real-Life Example: Sale + Dividend
Let’s walk through a realistic scenario to see exactly how the math works. Imagine you are a tax resident in Poland using a foreign broker.
The Scenario:
| Date | Event | Amount (EUR) | Details |
|---|---|---|---|
| Mar 1, 2024 | Buy 10 units @ €100 | €1,000 | + €2 commission |
| Jul 1, 2024 | Dividend Payout | €20 | 15% tax withheld (€3) |
| Sep 1, 2024 | Sell 10 units @ €110 | €1,100 | + €2 commission |
Let's break this down into the steps you'll need for your tax return.
🚀 Step 1: Calculate Capital Gains (The Sale)
Your taxable profit is simply Income minus Product Costs.
1. Calculate Income (Przychód)
This is the gross amount you received from the sale.
- Sale Amount: €1,100
- Exchange Rate: Use the NBP average rate from the last working day before the sale (Aug 30, 2024).
- Rate: 4.60 PLN/EUR
$$ 1,100 \text{ EUR} \times 4.60 = \mathbf{5,060 \text{ PLN}} $$
2. Calculate Costs (Koszty Uzyskania Przychodu)
This includes the purchase price plus any commissions paid for both buying and selling.
- Purchase: €1,002 (€1,000 price + €2 comm.) on Feb 29 (day before Mar 1).
- Rate (Feb 29): 4.40 PLN/EUR
- Cost: $1,002 \times 4.40 = \mathbf{4,409 \text{ PLN}}$
- Sale Commission: €2 on Aug 30.
- Rate (Aug 30): 4.60 PLN/EUR
- Cost: $2 \times 4.60 = \mathbf{9 \text{ PLN}}$
Total Deductible Costs: $4,409 + 9 = \mathbf{4,418 \text{ PLN}}$
3. Your Taxable Profit
$$ 5,060 \text{ (Income)} - 4,418 \text{ (Costs)} = \mathbf{642 \text{ PLN}} $$
Tax Due (19%): $642 \times 0.19 = \mathbf{122 \text{ PLN}}$
💰 Step 2: Declare Dividends
Dividends are tricky because you often pay some tax abroad (e.g., 15% in the USA), and you need to settle the difference in Poland.
- Gross Dividend: €20
- Tax Paid Abroad: €3
- Exchange Rate: NBP rate from Jun 28 (day before Jul 1) = 4.55 PLN/EUR
The Calculation
- Gross Dividend in PLN: $20 \times 4.55 = \mathbf{91 \text{ PLN}}$
- Tax Paid Abroad in PLN: $3 \times 4.55 = \mathbf{13.65 \text{ PLN}}$
- Total Polish Tax (19%): $91 \times 0.19 = \mathbf{17.29 \text{ PLN}}$
The Deduction Rule
You can deduct the tax paid abroad from your Polish tax bill, but only up to the 19% limit.
Final Tax to Pay: $$ 17.29 \text{ (Total Due)} - 13.65 \text{ (Paid Abroad)} = \mathbf{3.64 \text{ PLN}} $$
You owe the Polish tax office 3.64 PLN.
📝 Step 3: Filling the PIT-38 Form
Here is exactly where to put these numbers on the form.
Section C: Capital Gains (Odpłatne zbycie papierów wartościowych)
| Field No. | What to Enter | Value (PLN) |
|---|---|---|
| 22 | Przychód (Total Income) | 5,060 |
| 23 | Koszty (Total Costs) | 4,418 |
| 26 | Dochód (Profit) | 642 |
| 31 | Należny podatek (Tax Due) | 122 |
Section G: Dividends (Dywidendy i inne udziały)
| Field No. | What to Enter | Value (PLN) |
|---|---|---|
| 44 | Zryczałtowany podatek (Total 19% Tax) | 17.29 |
| 46 | Podatek zapłacony za granicą (Foreign Tax) | 13.65 |
| 47 | Różnica (Tax to Pay) | 3.64 |
⚠️ Common Pitfalls to Avoid
- ❌ Using the Wrong Date: Always use the NBP rate from the day before the transaction. If the transaction was on Monday, use Friday's rate.
- ❌ Ignoring Small Dividends: "It's only €1, surely they don't care?" They do. All income must be reported.
- ❌ Forgetting Commissions: Fees reduce your tax bill. Don't leave free money on the table!
- ❌ Merging Currencies: Do not sum up EUR and USD totals. Convert every single transaction to PLN first, then sum the PLN values.
✅ Summary
For this example, your total tax liability is:
- Capital Gains Tax: 122 PLN
- Dividend Tax: 4 PLN (rounded)
- Total Bill: 126 PLN
Filing PIT-38 for foreign ETFs takes a bit of work, but once you understand the formula, it's straightforward. Just remember: keep good records, use the right exchange rates, and when in doubt, consult a tax advisor.
Disclaimer: This article is for informational purposes only. I am a financial educator, not a tax advisor. Tax laws can change, so always verify with official sources.