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Taxes for IT Sole Proprietors: Belarus vs. Poland
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Choosing the optimal tax jurisdiction as an IT professional is not only about today’s tax burden but also about long-term financial strategy. Many Belarusian IT entrepreneurs consider registering as a sole proprietor (SP) in Poland as a potentially more stable and predictable option. However, in practice, comparing taxes in Belarus and Poland is far more complicated than simply looking at the rates: the final amount depends on tax regimes, turnover, income structure, social security contributions, and real administrative costs.
In this article, we explain how the tax burden differs for IT entrepreneurs in Belarus and Poland. We consider available tax regimes, compare mandatory contributions, break down examples of calculations and show in which situations each option can be more profitable. The material is intended for those who want to understand the numbers, predict their financial burden and choose the most effective business model, whether it’s staying in Belarus, moving to Poland or combining various structures.
Tax Regime for Sole Proprietors in Belarus
When working in IT as an individual entrepreneur (SP) in Belarus, it is essential to understand which tax regimes are available, how they work, and which obligations they include.
SPs operating in the IT sector in Belarus face one key limitation: they may only work under the general taxation system, which means paying personal income tax at a 20% rate. Using the unified tax or simplified tax system is not allowed for IT services — legal regulations explicitly exclude such activities from the eligible categories.
Below is a clear and concise breakdown of how income tax is calculated, which expenses can be deducted, and when payments must be made.
How the 20% Income Tax Is Calculated
Income tax for SPs on the general system is based on revenue.
The simplified formula:
Tax = (Income – Documented Expenses) × 20%
Income includes all payments received to the SP’s bank account or in cash as part of the business: service fees, royalties, consulting, tech support, software development, etc.
If the entrepreneur’s cumulative annual income exceeds 500,000 BYN, the income tax rate increases to 30%.
Which expenses can be deducted?
IT sole proprietors may reduce their taxable base by deducting actual, documented business expenses, such as:
The more justified expenses, the lower the taxable income.
Income Tax Deadlines
SPs under the general taxation system must:
1. Submit quarterly tax returns
Usually by the 20th day of the month following the end of the quarter.
2. Pay the tax quarterly
Typically by the 22nd day after filing the return.
Example:
For Q1 (January–March), the return is submitted by April 20, and the tax is paid by April 22.
Summary of the Belarusian Model for IT SPs
Rate: 20% income tax
Base: net income reduced by documented expenses
Reporting: quarterly
Payment: by the 22nd day after the quarter
Deductions: professional expenses — the main tax reduction tool
Additionally, SPs must pay contributions to the Social Protection Fund.
If the SP’s annual income is below the equivalent of 12 minimum wages, contributions are calculated as 35% of actual income. If income exceeds this threshold, contributions are paid based on 12 minimum wages at the same 35% rate.
The current minimum wage in Belarus is 726 BYN.
Starting January 1, 2026, it will be 858 BYN.
Thus, for income earned in 2025, contributions of 35% apply if the annual income is less than:
12 × 726 = 8,712 BYN.
Tax Regimes for IT Entrepreneurs in Poland
Poland remains one of the most attractive jurisdictions for Belarusian IT specialists due to flexible taxation options, predictable management and wide opportunities for B2B work. Unlike Belarus, where IT-SPs are limited only to income tax, Poland offers several regimes that an entrepreneur can choose depending on the level of income, type of activity and expected burden.
Registration and Available Forms of Taxation
To work in Poland as a self-employed IT specialist, as a rule, a person’s registers a jednoosobowa działalność gospodarcza (JDG)- the equivalent of individual entrepreneurship. This form allows you to conclude B2B contracts and choose a tax regime.
The main taxation options are:
1. Podatek liniowy (flat tax, 19%)
Suitable for high-income specialists, as the fixed rate does not depend on the amount of earnings. It is allowed to deduct costs associated with doing business.
2. Skala podatkowa (progressive PIT: 12% and 32%)
It is used at a low or average level of income, as well as when an entrepreneur can effectively apply tax deductions.
Income within the annual threshold is subject to a 12% tax rate, whereas income above this threshold is taxed at 32%.
3. Ryczałt od przychodów ewidencjonowanych (lump-sum tax)
For IT services, the rate is 12% of the revenue.
The tax is calculated from turnover without the possibility of deducting costs, but for many high-income IT specialists, this regime is the most profitable due to the simplicity of administration and low tax burden.
Tax Rates and Income Thresholds
19% — flat tax
12% — PIT rate up to the threshold
32% — PIT rate above the threshold
12% — lump-sum tax on IT services (calculated on gross revenue)
The optimal tax regime is chosen based on the business model : a lump-sum tax is best suited for low operating costs; a flat tax rate is appropriate for high income with deductible expenses; a progressive scale is the best option when applying tax deductions or using a reduced rate of 12% per part of the income.
Mandatory ZUS Contributions: Amounts, Options, Relief Periods
Every entrepreneur in Poland must pay contributions to ZUS, the national social security system. This is a major component of the total tax burden and directly influences the choice of taxation regime.
Key ZUS contributions include:
pension insurance
health insurance
sickness insurance (optional)
accident insurance
Poland provides reduced-burden periods for new entrepreneurs:
1. Ulga na start — first 6 months
No social security contributions; only the health insurance payment applies.
2. Preferencyjny ZUS — next 24 months
Social contributions are calculated from a reduced base, significantly lowering monthly payments.
3. ZUS pełny — after 30 months
Full contributions based on the standard minimum base.
For some regimes (e.g., lump-sum), the health contribution is calculated as a percentage of income.
For IT specialists working under B2B contracts, the combined burden — tax + ZUS — is crucial, especially since the health contribution is not deductible from the tax.
Tax Deductions, Expenses, and Administrative Advantages
The Polish tax system allows entrepreneurs to significantly optimize their burden through:
equipment purchases
software and licenses
office or coworking rent
internet and communications
business travel
hardware amortization
training and professional development
Under the flat tax or progressive tax, such costs reduce the taxable base, which is especially beneficial for those who have large regular professional investments.
Administrative processes in Poland are largely digitized: entrepreneurs manage accounting through online systems, issue invoices electronically and access public services through profil zaufany. This reduces the number of documents, minimizes errors and makes the entire tax administration more transparent.
Comparison of Overall Tax Burden
Comparing the tax burden for an individual IT entrepreneur in Belarus with Poland requires studying not only tax rates, but also the structure of costs, social contributions, administrative requirements and actual net income that remains after all payments. At first glance, the rates may seem similar, but the final amount of mandatory payments and the ease of doing business are significantly different.
Comparison of Tax Rates and Mandatory Payments
In Belarus, an IT sole proprietor operates exclusively under the general taxation system:
The personal income tax rate is 20%, and if annual income exceeds 500,000 BYN, the rate increases to 30%.
Social security contributions to the Social Protection Fund (FSZN) are calculated at 35% either from actual income (if it is below 12 minimum wages per year) or from a fixed base of 12 minimum wages.
For 2025, this minimum base is 8,712 BYN.
In Poland, the entrepreneur can choose a suitable tax regime:
Ryczałt — 12% of turnover.
Linear tax — 19% of profit.
Progressive PIT scale — 12% and 32%, depending on income thresholds.
Taxes are combined with ZUS contributions, where there are preferential periods (Ulga na start, Preferencyjny ZUS) and later a full rate, which becomes a substantial part of monthly expenses after 30 months. However, unlike in Belarus, most contributions are fixed rather than being a percentage of the annual income.
Tax Burden Comparison at €2,000 per Month
At an income of around €2,000 per month (approximately €24,000 per year):
In Belarus:
The tax burden depends heavily on expenses.
With low costs, the entrepreneur pays 20% of the income, as well as mandatory contributions to the FSZN. In the absence of significant expenses, the total tax burden increases significantly and can make up a significant share of income.
If there are significant costs (equipment, subscriptions, office rental), the tax base is reduced. However, contributions to the FSZN remain mandatory and after reaching the established threshold are fixed, regardless of fluctuations in actual income.
In Poland:
At the same income level, many IT specialists choose ryczałt because the 12% turnover tax can be more advantageous when expenses are low.
The linear 19% tax becomes attractive when there are significant costs to be deducted, such as equipment, software, rent and travel expenses.
It is important to note that the healthcare contribution (NFZ) does not reduce the taxable base, but it is not directly tied to the annual income to the same extent as contributions to the Federal Health Insurance Fund in Belarus.
In general, with an income of about €2,000 per month, Poland often offers a softer financial burden due to the flexibility of tax regimes and benefits on ZUS contributions in the first years of operation.
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Impact of Expenses, Deductions, and Income Structure on the Final Amount
In Belarus
The primary tool for reducing tax burden is documented business expenses.
The more legitimate expenses an IT entrepreneur can deduct, the lower the taxable base becomes.
However, FSZN contributions are not reduced, even if income falls or if the entrepreneur invested heavily during a given period.
In Poland
Optimization opportunities are wider:
Under the linear system, almost all business-related expenses are deductible.
Under the PIT scale, various personal deductions are available.
Under ryczałt, expenses are not deductible, but the low rate often makes this regime optimal when expenses are minimal.
Poland’s system adapts better to the specific business model:
High expenses favor the linear tax; low expenses favor ryczałt.
Administration and Bureaucracy: Where Is It Easier to Operate?
Belarus
Administration is formally straightforward:
Quarterly reporting.
Online submission of tax returns.
Fixed deadlines.
However, the entrepreneur must maintain detailed expense documentation, handle accounting independently, and interact with tax authorities in case of audits or clarifications.
Poland
Administrative burden varies by regime:
Under ryczałt, accounting is minimal: fixed rate, no expense documentation.
Under linear or PIT scale, the accounting is more complex, but digital tools, electronic invoicing, automated systems, and the profil zaufany simplify the process significantly.
Overall, bureaucracy in Poland is lower, but accounting services are more expensive.
When It Is More Advantageous to Remain a Sole Proprietor in Belarus
Despite Poland’s growing popularity among IT entrepreneurs, there are still situations in which working as an individual entrepreneur in Belarus is more convenient from a financial and operational perspective.
This is especially true for specialists with moderate income, stable contracts and minimal administrative needs.
Scenarios with Low and Moderate Tax Burden
Belarus can be more favorable when:
1. Income is low or moderate (up to ~€2,000–2,500 per month)
At this level, the overall tax burden remains manageable, especially when the entrepreneur has enough documented expenses to reduce the taxable income.
2. A significant portion of income is spent on professional expenses
Large equipment purchases, subscriptions, office rent, and tools reduce the tax base. Higher expenses offset FSZN contributions.
3. The business does not plan rapid growth
If income remains far from the 500,000 BYN annual threshold, the 20% PIT rate stays unchanged. For many specialists with stable, modest income, this model works well.
Advantages of Simplified Administration
Even with the need to maintain expense records, Belarusian individual entrepreneurship is predictable:
Quarterly, not monthly, reporting.
Fully online declaration submission.
No need to choose between multiple tax regimes IT services must use the general system, reducing the risk of mistakes.
Administrative procedures are familiar and well-established.
For many, predictability and simplicity are valuable: the regime is fixed, the rules are clear, and tax optimization is achieved through expenses.
When Belarus Is a Rational Choice for an IT Specialist
Remaining an individual entrepreneur in Belarus makes sense when:
1. Clients are mostly in Belarus or the CIS
This avoids currency control issues, reduces transaction costs, and simplifies paperwork.
2. There is cooperation with Hi-Tech Park (HTP) companies as a contractor
Even though an entrepreneur is not an HTP resident and does not receive tax benefits, working with HTP companies offers:
stable contracts,
predictable cooperation,
minimal legal risks.
Many HTP companies prefer local sole proprietors, ensuring a steady workflow without the need to create foreign entities.
3. There is no need for relocation or EU contracting
If operations are remote, income stable, and switching to an EU jurisdiction brings no strategic benefits, remaining in Belarus is rational.
4. Minimizing administrative costs is important
Polish accounting is more expensive, and ZUS contributions become significant after the preferential period.
For entrepreneurs with modest income and few transactions, the Belarusian system is simpler and cheaper.
When Poland May Be More Advantageous
Poland is becoming an attractive jurisdiction for IT entrepreneurs not only due to flexible tax regimes, but also due to transparent administrative procedures, social protection system and direct access to European clients.
In many cases, the Polish system provides substantial financial and strategic benefits.
When the Polish Tax System Offers Financial Advantages
Poland is more favorable when the entrepreneur can select a tax regime that fits income level and expense structure. Unlike Belarus, where IT entrepreneurs are restricted to a single model, Poland offers three legitimate alternatives.
Poland is more favorable when the entrepreneur can select a tax regime that aligns with their income level and expense structure. Unlike Belarus, where IT entrepreneurs are actually limited to one taxation model, three full-fledged and legal alternatives are available in Poland.
Poland is usually the better option when:
1. Expenses are low and income is high
Ryczałt at 12% of turnover is especially effective for IT freelancers with high income and minimal costs.
2. Professional expenses are substantial
If a significant part of the budget is for equipment, software, office rental or travel, a flat tax of 19% may be more profitable than 20% in Belarus, especially in cases where costs significantly reduce the tax base.
3. Income is growing and cooperation with international clients is expected
Higher earnings fit well into Poland’s flexible system.
You can switch tax regimes annually, and optimize the load as the business grows is an option that is not available in Belarus.
High Income, Regular Expenses, and Work with European Clients
Poland is typically the optimal choice when:
monthly income exceeds approximately €3,000–4,000;
there are fixed business costs;
activity is focused on European customers.
The advantages include:
no currency controls,
fast and inexpensive SEPA payments;
clean legal framework for working with Western counterparties;
higher level of trust from customers.
Working through a Polish JDG is often perceived as a sign of business reliability and compliance with EU standards.
Additional Benefits: Social Protections and EU Jurisdiction Reputation
Along with financial advantages, Poland offers strategic non-financial benefits:
1. Full social protections
Through ZUS contributions, the entrepreneur gains access to:
healthcare,
pension system,
maternity benefits,
disability insurance.
This significantly increases the level of personal financial security – something Belarusian IEs often lack.
2. Strong reputation and legal stability
Business registration in the EU jurisdiction is a significant factor of trust for clients from the United States, Germany, the Netherlands and Scandinavia.
3. Integration into the European business environment
Poland provides access to:
EU banking,
international payment systems,
entrepreneurship support programs,
relocation and residency opportunities.
This makes Poland not only a tax option but a strategic platform for professional growth.
Conclusion
The choice between operating as a sole proprietor in Belarus and registering a business in Poland depends on income level, expense structure, growth plans, and client geography.
For specialists with a stable average income and significant expenses, Belarus remains a predictable and convenient option with simple administration.For those who earn more, work with international clients or are looking for strategic benefits from working in the EU, Poland offers flexible tax systems, favorable conditions for high-income entrepreneurs, as well as additional social and reputational benefits.
If you are considering relocating, planning tax optimization, or determining which model fits your income and work format — our team can help.
We provide jurisdiction selection consulting, set up sole proprietorships in Belarus and Poland, support relocation, and help structure operations in a legal, safe, and financially efficient way.
How to contact us
For more information or a consultation on jurisdiction selection, or set up sole proprietorships in Belarus, do not hesitate to contact us. We are here to help and support you. Phone and email communication options are available for your convenience:
Daria Fedorova is a marketing expert with years of experience supporting businesses entering and expanding in the Belarusian market. She combines strategic marketing expertise with knowledge of legal and administrative processes, helping companies successfully establish and grow their presence in the country.
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