New Car Tax Rules in Poland: Lower Limits & Emissions-Based Costs for Businesses

The tax on company cars is now in effect, and many drivers in Poland will likely pay more to the tax authorities. A shift in how businesses can deduct taxes on vehicle expenses, tied to carbon dioxide emissions, is reshaping the automotive landscape for Polish companies. The changes, stemming from a 2021 law, are designed to incentivize lower-emission vehicles but are raising costs for businesses reliant on traditional combustion engines.

A New System for Calculating Vehicle Costs

Beginning in January 2026, the way businesses account for company car expenses has changed significantly. The new system centers on CO2 emissions, directly impacting the amount of tax deductions a company can claim. The government frames these changes as necessary to align with European Union climate policy and a broader “green transformation,” but the practical effect is a reduction in deductible costs, particularly for vehicles with higher emissions.

The shift originates from an amendment to Poland’s Act on Electromobility and Alternative Fuels in December 2021. Many businesses were reportedly caught off guard by the implications of this law, leading to a scramble to reassess their vehicle costs, according to Piotr Juszczyk, a tax advisor at InFakt, as reported by Interia.pl.

Three Tiers Replace Two: A Less Favorable System

Until the end of 2025, the rules were relatively straightforward. Businesses could deduct the full cost of a company car up to a limit of 150,000 zł for gasoline vehicles and 225,000 zł for electric cars. Now, the system is divided into three amortization thresholds. The highest limit of 225,000 zł remains exclusively for fully electric vehicles (BEV) and hydrogen-powered vehicles. A second tier, at 150,000 zł, applies to cars emitting less than 50 grams of CO2 per kilometer – primarily plug-in hybrid vehicles. The lowest tier, a significantly reduced 100,000 zł, covers all other vehicles, including traditional gasoline cars and conventional hybrids.

In other words popular models that previously qualified for full deductions now fall into the least favorable category. Examples include the Toyota Corolla 1.8 Hybrid and the Hyundai Tucson 1.6 HEV, according to reporting from Interia.pl.

Previously Purchased Vehicles: Do Old Rules Still Apply?

The impact of the new limits isn’t uniform. Businesses that purchased gasoline cars in 2025 and added them to their fixed asset register retain the previous amortization limits. However, the situation is different for leased or rented vehicles acquired in 2025. From January 2026, a proportional calculation must be applied if the vehicle’s price exceeds the new tax limit.

Juszczyk explains that this proportion is calculated by dividing the applicable limit by the car’s price. For mixed use – both business and private – the price refers to the net amount plus half of the VAT. This proportion applies to lease payments and insurance premiums (AC and GAP), but not to mandatory third-party liability insurance (OC) or ongoing maintenance costs like fuel and servicing, as detailed by Superauto.pl.

A Real-World Example: Thousands of Złoty in Differences

The financial implications are best illustrated with an example. According to reporting from Interia.pl, a Hyundai Tucson 1.6 HEV valued at approximately 161,000 zł gross previously allowed a business leasing the vehicle to save nearly 35,000 zł over five years. Under the new regulations, that amount drops to just under 24,000 zł – a difference of over 11,000 zł, assuming a 19% linear tax rate and mixed-use of the vehicle. For many small businesses, this represents a significant increase in operating costs.

Experts Criticize the Changes

The new regulations haven’t been well-received by tax advisors, who argue that the rules don’t reflect the changes in the automotive market in recent years. “Since 2021, car prices have soared, while the limits have remained unchanged since 2017. Instead of indexing them, they are planning to lower them. What we have is completely out of touch with reality,” Juszczyk told “Dziennik.”

Market data supports these concerns. In the first half of 2025, a staggering 94.2% of newly registered passenger cars in Poland emitted at least 50 grams of CO2 per kilometer. Only 0.7% of the market qualified for the more favorable 150,000 zł limit – just over two thousand vehicles.

A Green Transformation or New Costs?

While intended to encourage businesses to choose more environmentally friendly vehicles, the new regulations may not be achieving that goal. Electric cars and plug-in hybrids remain a costly investment for many companies, and the charging infrastructure is still developing. Until it becomes more accessible, a company’s vehicle choice will likely be driven by cost calculations rather than CO2 emissions.

The financial burden of these changes will ultimately fall on those who make those calculations. Recent updates from the Ministry of Finance, reported by Superauto.pl, clarify that the lower 100,000 zł limit will apply even to leasing agreements signed before January 1, 2026, removing a potential grace period for some businesses.

Looking Ahead: Businesses should carefully evaluate their fleet options and consider the long-term financial implications of the new regulations. Exploring leasing options that allow for inclusion in fixed asset registers could offer a way to maintain existing tax benefits, at least for some vehicles. The evolving regulatory landscape and the increasing cost of compliance will undoubtedly shape the future of company car ownership in Poland.