Home Office in Poland Is Not Enough to Constitute a Permanent Establishment
The case concerned a German consulting company specialising in recruitment processes, which employed individuals working remotely from Poland to perform administrative and support tasks such as preparing reports, organising meetings, and providing technical assistance.
The employees worked from their private apartments in Poland, using laptops provided by the company. The foreign enterprise had no office, branch, or any premises in Poland.
Despite this, the Director of the National Tax Information (KIS) concluded that the company’s remote work model in Poland resulted in the creation of a permanent establishment and therefore a corporate income tax (CIT) liability in Poland. According to the tax authority, the employees’ apartments constituted a “fixed place of business,” and the activities performed were of a non-auxiliary nature.
Position of the Polish Administrative Courts
The Provincial Administrative Court in Gliwice disagreed with the tax authority’s interpretation, and its position was upheld by the Polish Supreme Administrative Court (NSA).
The NSA clearly stated that, to recognise a permanent establishment in Poland, there must be a fixed place of business through which the company’s activities are carried out. Private homes of employees do not meet this condition if the company has no legal title, control, or access to those premises – it does not rent, manage, or otherwise use them.
The court also emphasised that the tasks performed by the employees were of an auxiliary and preparatory nature, and that such activities did not constitute the company’s core business.
What the Ruling Means for Foreign Businesses Operating in Poland
The NSA judgment of 28 October 2025 (II FSK 163/23) is only the second favourable decision in Poland on a similar issue, following an earlier verdict from February 2025 (II FSK 609/22).
In both cases, the Court confirmed that remote work in Poland alone does not create a permanent establishment of a foreign enterprise.
The NSA referred to the double taxation agreement between Poland and Germany, reminding that a permanent establishment in Poland does not arise if the activity is of a preparatory or auxiliary nature. At the same time, however, it pointed out that such an assessment of the type of activity can only be made if there is a fixed place of business – otherwise it does not apply.
In practice, for companies hiring remote workers in Poland, this means that:
- Providing employees with IT equipment does not create space “at the disposal” of the company in Poland.
- Working remotely from any location in Poland (home, café, or park) does not trigger a fixed place of business.
- No rights to or lease of premises in Poland exclude recognition of a local business facility.
In our view, the NSA’s ruling should be assessed clearly positively. It aligns with the Poland–Germany Double Tax Treaty and confirms that Polish tax authorities cannot interpret the concept of a permanent establishment in Poland too broadly – especially when the foreign company has no physical presence or premises in the country.
Even if it is true that, in the digital economy, many business models now operate remotely and the provisions of double tax treaties drafted decades ago do not fully reflect modern realities, the principle of legal certainty must prevail. Any adjustments to tax rules for remote work in Poland should be made through legislative amendments, not by extending interpretations.
Summary: A Significant Step for Remote Work and International Taxation in Poland
The Supreme Administrative Court’s ruling (II FSK 163/23) marks another key milestone in developing a stable and predictable Polish case law on the taxation of international enterprises. It gives greater certainty to foreign companies employing remote workers in Poland, provided they do not maintain an office or other physical space here and other conditions of the DTT are met.
The decision sends a clear message: until double taxation agreements are updated to reflect the realities of remote and hybrid work, a home office in Poland cannot be equated with a fixed place of business and therefore as a permanent establishment in Poland.
Grant Thornton’s tax advisors are available to assist foreign companies in assessing whether their business model or employment structure in Poland could give rise to a Permanent Establishment risk.