[Poland] Sejm passed an act on employment of OT or reserve soldiers. What are the benefits for companies?

The government draft act adopted by the Sejm assumes, among other things, the introduction of preferences for entrepreneurs hiring employees who are also soldiers of the Territorial Defence (OT) or soldiers of the Active Army Reserve (AR). How much will the maximum relief amount to for such an employer?

New regulations – what will companies employing OT and AR soldiers gain?

The draft act aims to create a support system for entrepreneurs employing OT and AR soldiers. It provides for the introduction of the following solutions:

Tax relief:

• granted for each employed OT or AR soldier
• the amount of the allowance depends on the length of the soldier’s service and ranges annually from PLN 12,000 (1 year of service) to PLN 24,000 (5 years of service)
• the relief can be deducted from the tax base
• the relief will be valid from 2026

Preferences in public procurement:

• applies to public procurement below the EU threshold (below PLN 25,680,260 for construction works and PLN 663,105 for supplies and services)
• the employment of OT and AR soldiers will be treated as a “qualitative criterion”
• the value of this criterion will not be lower than 10%

Initial allowance for soldiers:

• will replace the severance pay paid by the employer, the refund of which had to be applied for
• is to be paid once by the army after completing basic training
• its amount is 50% of the average salary in the second quarter of the previous year
• the benefit will be exempt from personal income tax

The aim of the solutions discussed above is to create much more attractive conditions for companies that decide to employ OT soldiers and reservists, as well as for those entities that already employ such people.

The new regulations will enter into force 14 days after their publication in the Journal of Laws.

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