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A short Guide about the Polish Tax Regulations

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FIRST-CLASS PERFORMANCE
FOR FULL SERVICE FINANCE & ACCOUNTING SOLUTIONS
Many companies are confronted with the need to
reduce accounting costs and to comply with the
required financial reporting standards. Compounding
this problem is the requirement that they must address
these requirements, with resource constraints on
their capital budget and staffing. These compliance
standards have also added complexities to many of
the financial processes.
getsix
®
has set itself the aim to support companies
and entrepreneurs in Poland in addressing these
challenges. getsix
®
in Poland offers a variety of
outstanding professional and complementary services
in the following areas:
Business Services & Consulting
Accounting & Payroll
IT Sales & Services
Tax & Legal
The customer base of getsix
®
includes Polish clients,
but also avariety of international companies with Polish
subsidiaries and/or branches, especially from German
speaking areas. In order to facilitate our mutual
co-operation with our clients, we operate at their
disposal agetsix
®
English Desk with afluent English
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offering our services in the English language, we also
offer in German and Polish.
With over 85 dedicated staff members who have
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expertise, will gladly assist you with your business
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be individually tailored and structured in line with the
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A dedicated staff member will always take responsibility
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During 2014 getsix
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a leading network of independent professional
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If you have any questions or queries, or just have
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getsix
®
Group is at your service.
Invest in Poland 2016
4
FOREIGNERS’ STARTING UP A BUSINESS IN POLAND
Legal basis The main law governing the business activity of foreigners in Poland is the Economic
Activity Freedom Act of 02 July, 2004. In accordance with the Economic Activity
Freedom Act aforeigner is: (1) anatural person holding no Polish citizenship, (2)
alegal person with the seat abroad and (3) an organisational entity which has no
legal personality and is furnished with legal capacity, possessing its seat abroad.
A. Foreigners from:
member states of the European Union
member states of the European Free Trade Agreement (EFTA) - parties to
the agreement on the European Economic Area
states that are not parties to the agreement on the European Economic
Area and that enjoy freedom of established under agreements concluded
by those states with the European Community and its member states - may
establish and conduct economic activity based on the same terms as the
Polish citizens
B.
The above rule also
applies to foreigners
who are not citizens
of the states
indicated in point
Aand who:
have received apermit to settle in Poland
have received apermit to stay in Poland under the status of along-term
resident of the European Community
have received aresidence permit in Poland for aspecified period of time
due to circumstances referred to the Foreigners Act of 13 June, 2003
have arefugee status in Poland or enjoy supplementary protection
have received apermit for tolerated residence
have received aresidence permit in Poland for aspecified period of time
and have been married to aPolish citizen residing in Poland
enjoy temporary protection in Poland
have avalid Pole’s Card
are family members of citizens of states indicated in point aabove and join
or stay with them in Poland
C.
Business activity
forms:
Unless international agreement state otherwise. Foreigners other than those
indicated above in points A and B have the right to establish and conduct
business activity (including joining below-mentioned partnerships/companies
and acquiring their shares) only in the form of:
a limited partnership
a limited joint-stock partnership
a limited liability comany and
a joint-stock company
Moreover, foreign entrepreneurs, i.e. a foreign person conducting economic
activity abroad and aPolish citizen conducting economic activity abroad, may
conduct business activity in the form of abranch office or they may establish
arepresentative office in Poland.
5
BRANCH OF A FOREIGN COMPANY
REPRESENTATIVE OFFICE
Basis According to the Polish law, foreign entrepreneurs may set up branch offices to
carry out business activity in the Polish territory. An entrepreneur from aforeign
country is allowed to establish abranch on condition that aPolish entrepreneur
enjoys equivalent rights in the country of origin of the foreign entrepreneur
(reciprocity rule), unless the international agreements ratified by Poland state
otherwise. The above does not concern entrepreneurs from EU and EEA countries
as well as from countries that are parties to association agreements with the EU in
the area of the freedom of establishment. Such entrepreneur’s may freely set up
branch offices in the Polish territory. abranch does not possess legal personality,
it constitutes an integral part of the foreign enterprise and cannot acquire rights
or incur obligations in its own name, cannot sue or be sued. However, branches
have significant independence with respect to employment matters. The scope
of business activity of the branch may not go beyond the foreign entrepreneur’s
scope of activity. Some special regulations (both in Poland and European Union)
regarding opening abranch may be applicable to specific industries, e.g. when
opening abranch of aforeign bank, insurance company or investment company.
In such cases, the opening of abranch should be seen in light of those specific
regulations (which may differ from the general rules).
Basis Foreign entrepreneurs may set up their representative offices in Poland. The
representative office does not constitute aseparate legal entity and is treated as
part of aforeign enterprise’s organisational and functional structure.
It cannot acquire rights or incur obligations, sue or be sued. The representative
office may be established by the foreign entrepreneur only to advertise and
promote the business of the entrepreneur in Poland.
Foreigners‘ business start-up
Invest in Poland 2016
6
FORMING OF COMPANIES IN POLAND
POLISH TERM
ENTRY INTO COMPANY
REGISTRY / LEGAL
PERSONALITY
MINIMUM CAPITAL SINGLE-MEMBER COMPANY
Limited Liability
Company (Ltd.)
Spółka z ograniczoną
odpowiedzialnością
Yes / Yes
5,000.00 PLN
Minimum face value
50.00 PLN
Yes
Incorporated Company
Spółka Akcyjna Yes / Yes
100,000.00 PLN
Minimum face value
0.01 PLN
Yes
Co-operative (Co-op.)
Spółdzielnia Yes / Yes No
No at least 10 members (5 in
anagricultural co-operative).
Does not apply if at least 3
members are legal persons.
General Partnership
Spółka jawna Yes / No No
No at least 10 members (5 in
anagricultural co-operative).
Does not apply if at least 3
members are legal persons.
Limited Partnership
Spółka komandytowa Yes / No No
No
Limited joint-
stockpartnership
Spółka komandytowo-
-akcyjna
Yes / No 50,000.00 PLN
No
Partnership under the
Civil Code
Spółka cywilna No / No No
No
Branch
Oddział Yes / No No
Permanent tax
establishment
Zakład No / No No
7
START-UP DUTY
WRITING
/ NOTARIAL
TRANSPARENCY
REGISTRATION
WITH THE TAX
AUTHORITIES
STATUTORY AUDIT:
TURNOVER ≥ 5,000,000.00EUR;
BALANCE SHEET TOTAL≥
2,500,000.00 EUR;
EMPLOYEES ≥50
Limited Liability
Company (Ltd.)
0.5% tax on the articles of association /
Entry in the Commercial Register
Yes / Yes No Yes
Provided that at
least two of those
requirements
are met
Incorporated
Company
0.5% tax on the articles of association /
Entry in the Commercial Register
Yes / Yes No Yes Compulsory
Co-operative
(Co-op.)
No / Entry in the Commercial Register Yes / No No Yes Mandatory
General
Partnership
0.5% tax on the articles of association /
Entry in the Commercial Register
Yes / No Yes Yes
Provided that at
least two of those
requirements
are met
Limited
Partnership
0.5% tax on the articles of association
(Yes for the Limited Partnership having
aLimited Liability Company as general
partner) / Entry in the Commercial Register
Yes / No Yes Yes
Provided that at
least two of those
requirements
are met
Limited joint-
stockpartnership
0.5% tax on the articles of association /
Entry in the Commercial Register
Yes / Yes Yes Yes
Provided that at
least two of those
requirements
are met
Partnership
under the Civil
Code
0.5% tax on the articles of association /
Entry into the CEIDG free of charge
Yes / No Yes Yes
Provided that at
least two of those
requirements
are met
Branch
As arule no; Entry in the Commercial
Register
- - Yes
In the context of
any audit of the
parent company
Permanent tax
establishment
- - - Yes
In the context of
any audit of the
parent company
Foreigners‘ business start-up
Invest in Poland 2016
8
INVESTMENT BASICS
Currency - Polish Złoty (PLN)
Accounting principles/financial statements - Polish
GAAP or, in some cases, IFRS. Financial statements
must be prepared annually. Special rules apply to
stock listed companies.
Foreign exchange control - None (generally) for
transactions with EU, EEA, OECD and certain other
countries. Permission may be required for certain
transactions with other jurisdictions and to conduct
certain transactions in aforeign currency.
Principal business entities - These are the limited
company (Sp. z o.o.), joint stock company (SA), limited
joint-stock partnership, limited partnership, sole
proprietorship and branch of aforeigncorporation.
TAX SYSTEM IN POLAND
CONSIST OF 16 TYPES OF TAXES
Direct taxes:
Corporate income tax (CIT)
Personal income tax (PIT)
Social security
Inheritance and Gift tax
Civil law transactions tax (PCC)
Stamp duty
Market fees
Visitor’s tax
Tax on certain financial institutions
(so-called bank tax)
Hydrocarbon tax
Indirect taxes:
Value Added Tax (VAT) & Excise duty
Lottery tax
Local taxes:
Real property tax
Transport vehicle tax
Agricultural & Forest tax
Dog ownership fee
ADMINISTRATION & COMPLIANCE
Tax year:
Calendar year: alternatively financial year can be
applied for, in which the Revenue & Tax office must be
informed in writing.
Filing requirements:
Taxpayers must self-assess and pay advance income
tax during the year and may use asimplified method
based on previous years’ results. The final calculation
and reconciliation of the tax due should be made
within three months of the end of the tax year.
Penalties:
Persons responsible for the tax reconciliation, as well
as members of the management board in certain
cases, are subject to penalties for non-compliance.
In certain cases, corporate entities may be subject
to penalties.
Taxation procedure:
In contrast to other European countries where a
general assessment is used by the tax authorities,
Poland uses the principle of reverse charge by
taxpayers.
The taxpayer must calculate the tax themselve to
issue atax return and to pay the amount due ontime.
Limitation period:
In principle tax debts become time-barred after
5years.
Once the limitation period expires, the tax liability
along with accrued default interest ceases to exist
default interests
9
ADMINISTRATION & COMPLIANCE CONTINUATION
Registration and
licensing
Polish law protects intellectual property, and the licensing of foreign brand names
and products is accepted practice. Licensing is prevalent in high-tech industries,
pharmaceuticals and retail franchises. Licensed products produced in Poland
may be exempt from import tariffs and excise duty and may also benefit from
being classified as aPolish product.
The granting of licences is not subject to official restrictions or approval. Alicenser
may not sublicense.
Accounting standards Under the IASCF Constitution the objectives of the International Accounting
Standards Board are:
To develop, in the public interest, asingle set of high-quality, understandable
and enforceable global accounting standards that require high-quality,
transparent and comparable information in financial statements and other
financial reporting to help participants in the world’s capital markets and other
users make economic decisions
To promote the use and rigorous application of those standards and
To bring about convergence of national accounting standards and International
Accounting Standards to high-quality solutions
Requirements of an
S.A. and Sp. z o.o.
Capital
Sp. z o.o.: The minimum capital required to establish alimited-liability company
is 5,000.00 PLN. Alimited-liability company may have asingle shareholder. S.A.:
The
minimum start-up capital for a joint-stock company is 100,000.00 PLN of
which 25% must be paid up before registration. Ajoint-stock company can be
established by one or more founding members, who must sign an articles of
association agreement.
Taxation of capital companies (CIT)
Capital companies are separate taxpayers to CIT. In principal, the companies are
subject to taxation on their global income. With regards amanagement board,
taxation on their global income only if they have aPolish certificate of residence.
Taxable income consists of all revenues earned in a tax year (financial and
operational), net of deductible costs. This income is subject to CIT at the rate of
19%. Capital companies are payers of VAT and other taxes in an ordinary fashion
Reserve
Sp. z o.o.: None. S.A.: 8% of annual net profits, until reserve reaches one-third
of share capital.
Foreigners‘ business start-up
BUSINESS REGULATIONS
Invest in Poland 2016
10
BUSINESS REGULATIONS
Requirements of an
S.A. and Sp. z o.o.
Founders, shareholders
Sp. z o.o.: There are no restrictions on number, nationality or residence of
shareholders. S.A.: The company must be founded by at least one natural or
legal person. Once the company has been established, one shareholder may buy
out others. There are no residence or nationality requirements
Supervisory board
Sp. z o.o.: If share capital exceeds 500,000.00 PLN and there are more than 25
shareholders, the company must have asupervisory board with at least three
persons. S.A.: asupervisory board with at least three members, each appointed
for a term of up to 5 years, is required. Both: No residence or nationality
requirements, but the chairman of the board for banks registered in Poland must
have aworking knowledge of Polish.
Management
There are no residency requirements. Management need not be shareholders for
either joint-stock or limited-liability companies. Sp. z o.o.: The term of office is not
defined. S.A.: The management board may be appointed for an initial term of up
to 2 years, with subsequent terms of up to 3 years each.
Labour
Employees have no influence over the management of private-sector firms unless
they are shareholders. Employees appoint one-third of the supervisory board of
firms undergoing privatisation, but this right expires once 51% of shares are sold.
Employees are entitled to form trade unions.
Disclosure
Both are obliged to prepare annual balance sheets and profit-and-loss statements
for filing with alocal tax office.
Sole proprietorship A sole proprietor is an individual who conducts business activity in his/her own
name and on his/her own behalf. There is no legal requirements regarding the
amount of the initial capital to undertake business activity as asole proprietor
in Poland.
Also, no new legal entity is established as aresult of such undertaking.
The business of the sole proprietor may be transformed into acapital company,
i.e. a
limited-liability company or ajoint-stock company
BUSINESS REGULATIONS CONTINUATION
11
Civil law partnership Two or more sole proprietors as well as other legal entities, i.e. partnerships and
capital companies, may decide to establish a civil law partnership. a civil law
partnership is not a
separate legal entity and does not possess legal personality.
It also cannot acquire rights or incur obligations in its own name and on its own
behalf, it can not sue or be sued. Contributions and possessions generated
during the business operations of the civil law partnership are owned by partners
as joint co-ownership.
Civil law partnerships may be transformed into registered partnerships based on
a
unanimous decision of the partners.
Professional
partnership
Professional partnerships may be established by specific professionals as defined
and listed in the Polish Commercial Companies’ Code (lawyers, architects, tax
advisers, accountants, doctors, dentist, and others). The professional partnership
may be formed for the purpose of pursuing more than one profession, unless the
law prohibits this specifically. As in the case of registered partnerships, professional
partnerships do not have legal personality, but have legal capacity and capacity
to perform legal actions (they may acquire rights, including ownership of areal
estate, and incur obligations in their own name, as well as sue and be sued).
Limited partnership A limited partnership is usually preferred when investors seek away to differentiate
their involvement in the partnership entity and consequently their liability for the
transactions performed by partnership. The distinctive feature of this partnership
is that the legal
positions of partners are not equal - general partner(s) and limited
partner(s) - which results in significantly different levels of rights and liabilities.
Limited joint- stock
partnership
A limited joint-stock partnership is the most complex type of partnership, as its
structure combines the elements of both the registered partnership and the joint-
stock company. Like other partnerships, the limited joint-stock partnership has
no legal personality, but it has legal capacity, which means that it may acquire
rights, and incur obligations in its own name. The limited joint-stock partnership
may also sue and be sued. Limited joint-stock partnerships are established by at
least one general partner and one shareholder. Participation of shareholders is
aconsequence of acapital-focused character of the limited joint-stock company.
Foreigners‘ business start-up
Invest in Poland 2016
12
Limited liability A limited liability company is the most popular and flexible form of conducting
business activity in Poland. It is Polish equivalent of the private limited liability
company in the UK, a société à responsabilité limitée (sarl in France, or
a Gesellschaft mit beschänkter
Haftung (GmbH) in Germany. Limited liability
companies may be established for any purpose allowed by law. They are often
used as special purpose vehicles, holding companies and as national companies
controlled by international corporations. The personal structure of the limited
liability company may be, in general, changed without affecting the legal structure
of the limited liability company, which is normally not the case with apartnership.
a limited liability company may also be run by a single founder/shareholder.
However, a single-shareholder limited liability company cannot incorporate
another single-shareholder limited liability company. Although alimited liability
company is acapital company, it still preserves some personal elements, such
as the possibility to limit the disposal of the company’s shares or establish the
shareholder’s right of individual control of the limited liability company. The shares
of alimited liability company do not take the form of adocument and cannot be
listed on the stock exchange.
Joint-stock company A joint-stock company is the Polish equivalent of the public liability company in
the UK, société anonyme (SA) in France and the German Aktiengesellschaft (AG).
Joint-stock companies are rather expensive to run and are primarily used for
large-scale business activities, in particular, if public is to be considered as away
of obtaining capital.
Formally it is more structured than the limited liability company.
The shares of joint-stock companies may be publicly traded (listed on the Stock
Exchange). The Polish law provides stricter and more complex rules with respect
to public joint-stock companies regarding their capitalisation, composition of the
governing bodies, compliance and reporting duties.
BUSINESS REGULATIONSBUSINESS REGULATIONS CONTINUATION
13
LEASING
Leasing types In their everyday work entrepreneurs deal with two kinds of leasing: operational
and financial. These two definitions also result from the tax regulations. Choosing
the form exclusively depends on the taxpayer using the lease contract which can
be subject to the needs of settling the tax costs and the term of predicted usage
of the subject of the leasing.
The Operational Leasing
With this form of the contract the subject of the leasing is recognised as assets
of the leasing party (for instance, aleasing company). Thus, it is the leasing party
who is obliged to make the depreciation and amortisation expenses. However, the
leasing instalments constitute the tax deductible expenses of the party using the
subject of the contract; VAT and an initial charge are added to these instalments.
The sum of the instalments set in the contract reduced by the due VAT has to
correspond to at least the initial value of the tangible fixed assets. Shall the term of
the contract expire the leaseholder is entitled to redeem the used subject.
The Financial Leasing
Choosing this kind of the lease contract the taxpayer has to know that the subject
of the contract is to be recognised as the asset of the Leaseholder; thus, unlike the
operational leasing, it is the leaseholder who is obliged to make the depreciation
and amortisation expenses. Additionally, the user may only recognise the interest
part of the leasing instalment as the tax deductible expenses. VAT shall be paid
in full in advance together with the first instalment, immediately after collecting
the subject of the contract. It is worth mentioning, that the customer becomes
the owner of the subject of leasing automatically after the last instalment is paid.
Leasing
Invest in Poland 2016
14
Key Differences:
The Operational Leasing The Financial Leasing
Depreciation and
amortisation
Duty of the leasing party Duty of the leaseholder
Term
Longer than 40% of the depreciation
and amortisation time of the subject (real
property - at least 10 years)
Over 12 months
Tax deductible
expenses
The user recognises the net instalments and
the initial charge as the expenses
The user recognises the interest part of the
leasing instalments and the depreciation and
amortisation as the expenses
VAT
Added to the leasing instalments
Paid in advance together with the first
instalment
Redeeming
Depending on the depreciation and
amortisation rate and the redemption term
After paying the last instalment the subject
becomes the possession of the user
The key factor when choosing the form of leasing are definitely the initial costs
which are significantly lower in case of the operational leasing due to the lower
involvement of equity. The majority of contracts concluded on the Polish market
are the operational lease contracts; one of the reasons of such situation may be
the fact that in case of the financial leasing VAT has to be paid in full in advance.
Choosing the operational leasing is also recommended in case the planned term
of using the subject is relatively short. For this reason it is possible to increase the
current operational costs which means reducing the tax base.
LEASING CONTINUATION
15
Legal basis Act of 15 February, 1992, on corporation tax
Basic information Residents are taxed on worldwide income; non-residents are taxed on Polish-
source income only. Foreign-source income derived by residents is generally
subject to corporation tax in the same way as Polish-source income, usually with
aforeign tax credit available, unless atax treaty provides otherwise. Branches are
generally taxed the same as subsidiaries.
Tax rate (CIT) 19% Corporate income tax rate for unlimited and limited taxable corporations,
however, no minimum corporate income tax
Payment method Monthly advance payments, amounting to the difference between the tax due at
the beginning of the year and the total sum of already made advance payments,
where applicable settlement of the advance payments in simplified form possible
Tax liability
unlimited: corporations with their executive board or headquarters in Poland
limited: corporations having no executive board or headquarters in Poland
- tax liability on the revenue generated in Poland
Company limited by
shares of Corporate
Income Tax (CIT)
taxpayers
Since 1st January, 2014, a Polish company limited by shares is obliged to pay CIT.
Contrary to earlier announcements profits generated by limited partnerships are
exempt from CIT taxation.
Financial year Calendar year: alternative financial year can be applied, in which the Revenue &
Tax Office must be informed in writing
Accounting generally double-entry accounting according to the Accounting Law dated
29.09.1994
Tax loss
compensation
Tax loss compensation is possible within a period of five years: Within one year
not exceeding 50% (the balance in subsequent years), no loss carryback.
Affiliated companies According to the OECD - Model Tax Convention (OECD-MA) if:
Company is involved directly or indirectly in the management, control or
capital oft he other company (subsidiary), or
The same persons participate directly or indirectly in the management,
control or capital of both companies (sister company)
Deductible operating
expenses
Those expenses are tax deductible, when incurred to generate revenue, or
to maintain respectively to secure the source of income; exceptions hereof
are written down in the Law on Corporate Income Tax (e.g. purchase of land,
representation expenses e.t.c.)
Transfer prices
External or internal price comparison
Resale price method
Profit distribution methods / net margin method (if the above are not applicable)
CORPORATE INCOME TAX (CIT)
Taxes
Invest in Poland 2016
16
CORPORATE INCOME TAX (CIT) CONTINUATION
Interests of credit/
externally financed
stakeholdings
Generally deductible
Thin capitalisation
rules
A corporation financed through debt by a parent company shall only add a part
of its interest payments to the tax-deductible costs. As of January 1st, 2015, the
related rules will be changed - this issue is specified below.
Ways of depreciation Depreciation methods: straight-line, declining, balance method only allowed for
special machinery, equipment and transport. An immediate write-off is possible
for low-value assets with an acquistion value up to 3,500.00 PLN (net)
Depreciation rates:
Real Estate: 2.5%
Buildings: 4.5%
Machinery and equipment: 7% - 25%
Cars and Trucks: 20%
Computer: 30%
If technically verifiable or in case of used assets, other rates are permitted.
Provisions Balance Legal Provisions are not recognised for tax purposes in general (a few
very restrictive exceptions)
Passenger car costs Depreciation and insurance costs of cars which cost more than 20,000.00 EUR
net - relates to the amount that is higher than 20,000.00 EUR
Non-tax-deductible
expenses
Amongst others (detailed list in Article 16, Paragraph 1 of the Tax Act)
Expenses for the purchase of land plots in ownership or the purchase
of beneficial interests (usufruct rights) for a specified in advance limited
period in time except the fees and commissions related to the purchase of
beneficial interests
Depreciation and insurance costs for cars with an acquisition value of more
than 20,000.00 EUR net
Interest, bank charges and exchange rate differences of loans, which
increase the investment costs in the acquisition stage
Charged but unpaid interests or interests waived, payable for debts
including loans.
Most of the accruals set up on the balance sheet
Expenses for the acquisition or purchase of shares
Entertainment expenses, mainly for entertainment
17
Withholding tax Dividends
Dividend paid by aPolish resident company to anon-resident company are taxed
at arate of 19% unless the rate is reduced under atax treaty or the dividends
qualify for participation exemption under the EU parent-subsidiary directive.
Interest
Interest paid to anon-resident is subject to a20% withholding tax unless the rate
is reduced under atax treaty or the EU interest and royalties directive.
Royalties
Royalties paid to anon-resident are subject to a20% withholding tax unless the
rate is reduced under atax treaty or the EU interest and royalties directive.
Other
Fees for specified intangible services (e.g. advisory, accounting, legal, technical,
advertising, data processing, market research, recruiting, management, control
services, guarantees, etc.) are subject to a20% withholding tax (subject to the
provisions of an applicable tax treat).
Dividends 19% respectively the particular double taxation treaty, the application and
adherence of the EU-Parent-Subsidiary Directive for the taxation of parent and
affiliated companies.
Domestic corporations:
Exemption from withholding tax for payments done by a Poland resident
corporation towards another Poland resident corporation.
Condition:
The entitled to the dividends must dispose of minimum 10% of the shares of
the liable to pay dividends corporation for an uninterrupted period of 2 years.
The beneficiary of the dividends shall not make use of a tax exemption with
respect to his whole income independent from the source of its realisation
(declaration of the beneficiary of the dividends required).
Taxes
Invest in Poland 2016
18
CORPORATE INCOME TAX (CIT) CONTINUATION
Dividends (Cont.) International:
Dividends received by a Polish resident company (with certain exceptions in
the case of limited joint-stock partnerships) from another Polish company or an
EU/EEA or a Swiss company are exempt from taxation if certain holding and
participation requirements are met. If the exemption does not apply, dividends
received are subject to taxation, but acredit for foreign withholdings tax and, in
some cases, underlying foreign corporate tax paid is available.
European Union (EU), European Economic Area (EEA):
Exemptions from withholding tax for dividends, paid by a resident in Poland
corporation towards acorporation resident in acountry of the EU or the EEA.
Condition: The entitled to the dividends must dispose of minimum 10% of the
shares of the liable to pay dividends corporation for an uninterrupted period of
2 years.
The beneficiary of the dividends shall not make use of atax exemption with respect
to his whole income independent from the source of its realisation (declaration of
the beneficiary of the dividends required).
Switzerland:
Exemption from withholding tax for dividends, paid by acorporation resident in
Poland towards acorporation resident in Switzerland.
Condition: The entitled to the dividends must dispose of minimum 25% of the
shares of the liable to pay dividends corporation for an uninterrupted period
of 2 years.
The beneficiary of the dividends shall not make use of atax exemption with respect
to his whole income independent from the source of its realisation (declaration of
the beneficiary of the dividends required).
19
Dividends aPolish
corporation
receives from:
European Union (EU), European Economic Area (EEA)
Tax exemptions for dividends which a corporation resident in Poland receives
from acorporation being resident in one of the European Union (EU) or European
Economic Area (EEA) countries.
Condition: The Polish corporation must dispose of minimum 10% of the shares
of the liable to pay dividends corporation for an uninterrupted period of 2 years.
The beneficiary of the dividends shall not make use of atax exemption with respect
to his whole income independent from the source of its realisation (declaration of
the beneficiary of the dividends required).
Switzerland
Tax exemptions for dividends which a corporation resident in Poland receives
from acorporation being resident in Switzerland.
Condition: The Polish corporation must dispose of minimum 25% of the shares
of the liable to pay dividends corporation for an uninterrupted period of 2 years.
The beneficiary of the dividends shall not make use of atax exemption with respect
to his whole income independent from the source of its realisation (declaration of
the beneficiary of the dividends required).
Other countries with Double Taxation Treaties
Set-off of already paid withholding tax and pro-rata corporate income tax for
Polish corporations, which dispose for an uninterrupted period of 2 years, at
least 75% of shares of the liable to pay dividends corporation with its registered
headquarters in another country with which Poland concluded a double
taxation treaty.
Other countries (without double taxation treaties)
Set-off of already paid withholding tax for Polish corporations, which dispose of
shares of the liable to pay dividends corporation with its registered headquarters
in another country with which Poland did not conclude adouble taxation treaty.
Taxes
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Choice of the
settlement method
of accounting of
exchange differences
Corporation and Income taxpayers (CIT and PIT) that are obliged to produce
financial reports have the right to choose the accounting method to calculate
the exchange differences mentioned in Article 9b, Paragraph 1, Point 2 (CIT)
or Article 14b, Paragraph 2 (PIT).
The accounting method chosen depends on certain conditions. Above all,
the taxpayers are obliged to notify the competent tax office in writing, of the
chosen method by the end of the first month of the tax year in which the
method will apply (in the case of taxpayers who start their business activities
- within 30 days of start-up). If this is the case and the taxpayer requires to
continue business activities, applying the balance method of calculating
exchange differences from 1st January, 2016, it should notify the tax office
about this before 31st January, 2016.
In addition, during the period of applying a specific accounting method to
calculate exchange differences, the annual financial statements of taxpayers
must be audited by state-authorised public accountants. In this case
the reported and audited exchange differences are tax deductible. The
introduction of statutory audits aims to confirm the accuracy of the calculated
exchange differences.
The period of applying the accounting method cannot be less than 3 years.
A taxpayer who selects the accounting method for calculating exchange
differences, as of 1st January, 2015, and has notified the competent tax ofce
within the statutory deadline, has to apply it until at least the end of 2017. The
accounting method chosen may be waived as of 1st January, 2018.
If you select the balance method of calculating exchange differences,
taxpayers on the 1st day of the fiscal year from which this method was chosen,
include income or deductible expenses accrued, exchange rate differences,
determined on the basis of the accounting regulations on the last day of the
previous fiscal year. From the first day of the tax year for which you have
chosen this method, apply the principles of the Accounting Act for calculating
the differences
Capital gains Capital gains are taxed as ordinary income at the standard corporation tax
rate 19%.
Foreign tax credit Foreign tax paid may be credited against Polish tax on the same profits, but the
credit is limited to theamount of Polish tax payable on the foreign income.
Incentives Expenses incurred for acquiring technological knowledge may reduce the taxable
base in certain cases. aone-time depreciation write-off up to 50,000.00 EUR also
may be available for small and start-up taxpayers.
Profits from
investments
Are taxable, are taxed at the CIT rate of 19%
CORPORATE INCOME TAX (CIT) CONTINUATION
21
Directive for the
taxation of the
parent and afliated
company
Exemption from withholding tax of capital gains distributions
provided that:
Holding period 2 years
Minimum shareholding: 10%
Payments for interest
and royalty to non-
residents
Tax exemption applies to:
Only for interest and royalty payments made between associated
companies (parent-subsidiary relationship, or sister-sister-company)
Thereby, the beneficiary of the payment must maintain acapital shareholding
of minimum 25%
Amortisation of
enterprise value
(goodwill)
Possible for an asset deal, but only performing the purchase of the whole
company respectively aseparable part of the business operations
Not possible in case of a share deal
Taxation of taxable
groups of companies
Possible important pre-conditions (all the following conditions must be met):
The parent company must have at least 95% of shares in the equity of other
companies in the Group
These other companies within the Group must have a minimum of
1millionPLN
To be able to generate income of at least 3% of the gross income in each
tax year
Part of a capital Group should be a limited liability company and public
company limited by shares
Tax collection dates
and deadlines
Annual tax declaration: filing until the 31 March of the following year, having
adeviating tax year until the last day of the third month following the closing
date of the tax year
During the fiscal year monthly payments on corporate income tax are due.
Payments must be settled until the 20th of the following month
Residence A corporation or alimited joint-stock partnership (with some temporary exceptions)
is tax resident in Poland if its registered seat or management is located in Poland.
Taxable income Corporation tax is imposed on acompany’s profits, which consist of business/
trading income, most passive income and capital gains. Normal business
expenses (with some limitations) may be deducted in computing taxable income.
Taxes
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The consequences
of settlement of
liabilities by type
of transferring
(Corporate Income
Tax {CIT}, VAT &
Private Income Tax
{PIT})
From 1st January, 2015, the settlement of liabilities through non-cash contributions
will generate taxable income by the debtor. The taxable income is defined as the
amount of debts, which shall be settled through non-cash contributions. If the
market value of the non-cash contribution exceeds the nominal amount of the
debt, this may be applied with the restriction that in these cases the market value
of the non-cash contribution is taxable.
If payables are settled through non-cash contributions, the amount of the claim is
tax deductible, but reduced by:
the VAT payable for the non-cash contribution, as well as
the sum of the depreciation carried out
A provision will be added, according to which the value of the received non-cash
contribution is the same amount as the repaid loan (credit), will not be considered
as taxable income.
Another regulation added, which states that the purchase value of properties,
as well as the intangible and tangible assets, which have been received as non-
cash contributions for the settlement of payables, are defined by the value of the
settled debt.
CORPORATE INCOME TAX (CIT) CONTINUATION
23
Income taxes of
Controlled Foreign
Companies (CFC)
The Corporate Income Tax (CIT) and Personal Income Tax (PIT) regulations will be
introduced providing provisions to the rule on taxation of CFC’s.
Basically, a CFC is a company, that meets all the following criteria:
Level of control - the Polish taxpayer owns for an uninterrupted period of 30
days per year, not less than 25% of share capital, voting rights or share in
profits of a foreign company
Nature of the received income - at least 50% of that company’s ‘passive
income’ is, i.e. financial income like dividends, shares, receivable account,
and copyrights, and so on
The location of the company in a country with a low level of taxation (i.e. tax
haven), at least one type of ‘passive income’ of the foreign company will be
taxed at a rate equivalent to at least 25% less than the Polish rate for CIT/
PIT, or if the income is exempted from taxes)
In some cases, a CFC is exempt from taxation (this is due to statutory requirements,
among other things, it can depend on the country of residence of the foreign
company, the nature of their business and the amount of income received).
The taxable amount of a CFC shall be the income according to CIT-/PIT-Law, but
only for income attributable to the Polish taxpayers and the corresponding period
of ownership share in the company profits.
The Polish taxpayer will have the opportunity to deduct the dividend received
from the CFC and the amount realised from the sale of share in the CFC from the
income mentioned above.
The taxpayers will be required to:
Registration of the CFC
Independent management of the accounting, event recording, which will
have influence on the income of the CFC, as well as
Notification of the profit of the CFC
The registration and the recording will not be necessary, if the CFC’s entire
income is subject to taxation in a country within the EU or the EEA and also exerts
its actual business in this country.
Taxes
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CORPORATE INCOME TAX (CIT) CONTINUATION
The taxation
of transformed
companies with
profits that have been
transferred to other
types of capital than
share capital
In the case of converting a company, that is an income taxpayer, into a company
that is not such a taxpayer, the taxable income from shared profits and non-
distributed profits will be increased by profits that are transferred into other types
of capital stock.
So-called equity
loans
From 1st January, 2015, Article 20, Paragraph 16 of the Corporate Income Tax law
(CIT) introduced that it will exclude tax exemptions for dividends or other income
from profit shares of legal persons, payable between associated enterprises.
However, this only applies to dividends, which are in another country, or other
income-paying company, which may thus be deducted from the taxable income
or tax base by the paying company.
25
Regulations
regarding the validity
of Certificates of
Residence (CoR)
From the beginning of the year 2015, the Polish tax authorities will change the
principles concerning the acknowledgement of the Certificates of Residence
(CoR), which means confirming the place of the seat or the residence of foreign
business partners for tax purposes.
The presentation of a valid CoR will allow entrepreneurs to apply the provisions
concerning the avoidance of double taxation in the case of payments for foreign
business partners (e.g. dividends or royalties). The absence of a valid CoR, at the
moment in which the payments are executed, this will allow the Polish entrepreneur
to be charged and pay the withheld tax according to the rates settled in Polish
income tax acts, without any tax credits or exemptions from withholding the tax.
According to the current practices, the CoR without an expiration date remains
valid, until there is a change of status or tax residence of the business partner.
Generally, it was sufficient to renew the CoR every few years or immediately after
the tax status of the payment’s receiver has been changed.
This new introduced amendment will have the impact on the CoR without an
expiry date, which shall become invalid automatically 12 months after the issue
date. These certificates after the expiration date will become invalid from the date
indicated on the document.
For precautionary reasons we would like to recommend, that if required, you
obtain a new CoR for the purpose of confirming the tax residence of foreign
business partners. Even from the beginning of January 2015 there are certain
doubts that might arise on the validity of certificates issued in 2014 and in the
previous years, due to this Polish entrepreneurs may be sent a charge for the
withholding of tax inline with the higher rates.
For further information or notices regarding the requirements on CoR and the
topic of the withholding tax, please don’t hesitate to contact us. We will happily
help with any queries or questions.
Taxes
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26
OTHER TAX ON CORPORATIONS
ANTI-AVOIDANCE RULES
Capital duty Capital duty is levied at 0.5% of the nominal value of share capital.
Real property tax Tax is generally levied on the owner of real estate (land, buildings and construction)
at rates imposed by the local authorities.
Property tax rates depend on property type and location. Tax is paid annually.
Tax rates are determined by district authorities, and in 2015, they cannot exceed:
Property type Tax rate
Land designated for the conduct
of business
0.89 PLN/m
2
Residential buildings 0.75 PLN/m
2
Buildings designated for the
conduct of business
22.86 PLN/m
2
Structures
2% of the property value
(entered as the basis for depreciation
Social security Employers and employees must make social security contributions in an amount
that is approximately 35% of an employee’s remuneration (with certain caps).
Stamp duty Stamp duty is levied, for example, when filling apower of attorney and when the
(central or local) authorities are requested to perform activities such as issuing
certificates, grant permission, etc. The applicable rates or fixed amounts are
specified in the stamp duty law.
Transfer tax Tax is imposed at arate of 1%-2% on certain types of transactions (e.g. sales,
exchanges of rights, loans) that are not generally covered by VAT. As a rule,
transactions exempt from VAT are exempt from transfer tax (except for real estate
and shares).
Other Excise tax is charged on turnover of selected goods. Shipping companies may
opt to pay tonnage tax on certain types of income. aspecial tax is imposed on the
excavation of silver and copper.
Transfer pricing The tax authorities are authorised to make necessary adjustments if they find
that transactions between related parties do not accord with the arm’s length
principle. Transfer pricing documentation must be prepared for related party
transactions exceeding acertain materiality threshold.
Disclosure
Requirements
Certain transactions must be reported to the tax authorities and/or National Bank
of Poland.
27
PRIVATE INCOME TAX (PIT)
Legal basis Law dated 26 July, 1991, on Income Tax
Registration
For tax purposes, if
PESEL is not applicable
Needs to be performed in the relevant tax office before the date when first PIT
advance is due.
Tax period For natural persons: Calendar year
Tax rates
(provided that no flat rate
taxation scheduled)
0 - 85,528.00 PLN: 18% minus 556.02 PLN
from 85,528.00 PLN: 14,839.02 PLN + 32% above 85,528.00 PLN
Tax-free income
(income tax allowance)
3,091.00 PLN (ca. 750.00 EUR)
Tax period For natural persons: calendar year
Tax liability
unlimited tax liability on worldwide income (unless aDouble Taxation Treaty
does confine the taxation obligation)
natural persons, who stay in Poland longer than 183 days ayear, who have
their center of their economic activity or their centre of vital interests in
Poland limited tax liability in certain domestic income
natural persons who neither stay in Poland longer than 183 days ayear,
nor who have their center of their economic activity or their centre of vital
interests in Poland
PLEASE PAY SPECIAL ATTENTION TO: In contrast to the German tax law there
is no distinction between profit and surplus income
Revenue streams 8 different revenues from:
1.
Special areas in agriculture
2. Economic activity
3. Self-employed (personally performed) activity
4. Employed activity
5. Capital investment and property rights
6. Rent & leasing
7. Capital gains from transfers
8. Other income
PIT progressive rates 18% and 32% for the excess over 85,528.00 PLN (ca. 21,000.00 EUR) (applicable
e.g. to employment income or income on dependent services)
PIT flat rate 20% (applicable to board members, being Polish tax non-residents after having
completed certain requirements)
19% (applicable e.g. to Interest, capital gains)
Taxes
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PRIVATE INCOME TAX (PIT) CONTINUATION
Monthly tax
compliance
PIT advances for agiven month to be paid by 20th day of the following month
Annual tax
compliance
Annual tax return for agiven year to be submitted by 30 April of the year following
the given year (with some exceptions)
Relevance of the tax
authorities
Both registration form as well as payment of PIT liabilities and submission of annual
PIT return should be made to the tax office relevant for Polish tax non-residents
in the region where aforeign individual stays or to the III Tax Ofce Warszawa
Śródmieście if the work is rendered on the territory of more than one region
Tax residency Foreign individuals arriving to Poland may become Polish tax residents if their
centre of vital (economic or personal) interest moves to Poland, or if they spend in
Poland more than 183 days in atax year.
Foreign individuals having their domicile in Poland (i.e. having status of Polish tax
residents) are subject to unlimited tax liability in Poland, i.e. they are subject to
taxation in Poland on their worldwide income, while individuals not domiciled in
Poland (i.e. having status of Polish tax non-residents) possess limited tax liability
status in Poland, i.e. they are subject to taxation in Poland only with respect to
income earned on the territory of Poland.
It should be noted that in order to determine the tax residency status, the
regulations of the relevant Double Tax Treaty concluded by Poland should be also
taken into consideration.
Legal basis for
rendering work in
Poland
Employment contract with the Polish entity
Regardless of the tax residency of the foreign individuals, income received by
them under the employment contract concluded with the Polish entity is always
subject to the Polish PIT according to the progressive rates of 18% and 32%. The
Polish employer is obliged to pay monthly PIT advances on the discussed income
calculated according to the progressive PIT rates. Foreign individuals are obliged
to calculate their final annual tax liability for given year as well as submit the annual
PIT return until 30 April of the following year.
29
Legal basis for
rendering work in
Poland (cont.)
Foreign employment contract and secondment to Poland
a) Polish tax non-residents
The foreign individuals are personallyresponsible for all PIT compliance activities
required by Polish PIT law, i.e. neither foreign employer nor host entity have
any obligations in this respect. Please note that the taxable income for Polish
PIT purposes includes all income obtained in connection with work in Poland,
including remuneration, bonuses of all kind and benefits-in-kind. Thus, most
benefits provided by the employer or host entity along with or in place of salary are
taxable as regular employment income. Income earned by the foreign individuals
in Poland may not be subject to PIT in Poland starting from the first day of his or
her stay in Poland, only if the following conditions defined in the relevant Double
Tax Treaty are simultaneously met:
presence in Poland last in the aggregate less than 183 days during the particular
tax year of 12 consecutive months (depending on the Double Tax Treaty, and
the remuneration is paid by, or on behalf of, an employer who is not aresident
of Poland (it should be however noted that appropriate analysis of economic
employer concept should be performed to assess if this condition is met), and
the remuneration is not borne by apermanent establishment of the employer
in Poland
If one of the above conditions is not met remuneration from the foreign
employment contract is subject to progressive PIT taxation in Poland, as of the
first day of his/her stay in Poland. PIT advances on income received from foreign
employment contract should be paid on amonthly basis for the months, in which
the discussed income was received. PIT advance for the given month shall be
paid by the 20th day of the following month with the use of 18% PIT rate (32%
rate may be also applied). Foreign individuals are obliged to calculate their final
annual tax liability with the use of progressive PIT rates. Foreign individuals are
also obliged to submit the annual PIT return until 30 April of the following year. Only
income related to work performed in Poland is reported for Polish PIT purposes.
b) Polish tax non-residents
Generally, the same rules applicable to Polish tax non-residents as mentioned
in point a) above should be also applied in case of foreigners being Polish tax
residents. As aconsequence, the foreign individuals are personally responsible
for all PIT compliance activities required by Polish PIT law, i.e. neither foreign
employer not host entity have any obligations in this respect. Please also note
that the taxable income for Polish PIT purposes includes all income obtained in
connection with work in Poland, including remuneration, bonuses of all kind
Taxes
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Board members a) Polish tax non-residents
Income realised by foreign individuals, being Polish tax non-residents and
appointed as the members of the management board of aPolish entity based on
the relevant shareholders’ resolution may be subject to 20% flat rate taxation in
Poland. All PIT compliance obligations related to this scheme are performed by
aPolish entity of which the individual is aboard member.
b) Polish tax residents
If a foreign individual being a member of the board of a Polish entity would
become Polish tax resident, income received from the membership in the
management board based on the relevant shareholders’ resolution would be
subject to progressive PIT taxation in Poland. In such acase the Polish entity
would be obliged to pay month PIT advances on the discussed income calculation
according to the progressive PIT rate of 18% (upon taxpayer’s choice 32% PIT
rate can also applied) while the year-end final reconciliation is made according to
progressive PIT rates up to 32%. Foreign individuals are also obliged to submit
the annual PIT return until 30 April of the following year.
Revenue costs:
(for income from
self-employment)
From an employment contract
Monthly 111.25 PLN
Annually 1,335.00 PLN
From several employment contracts Annual maximum 2,002.05 PLN
From an employment relationship for
foreign employees
Monthly 139.06 PLN
Annually 1,668.72 PLN
For more employment for foreign
employees
Annual maximum 2,502.56 PLN
Income from
self-employment
Income of persons belonging to, regardless of the manner of their
appointment, directors, supervisory boards, commissions or other
decision-making bodies of legal persons
Revenue from services rendered in the conduct and management on the
basis of the contract or contracts for work
PRIVATE INCOME TAX (PIT) CONTINUATION
31
Income from
economic activity
In particular income from trade or business which include the income of
self-employed among others:
Manufacturing, construction economics, trading/providing services employment
Work related to mining
Employment in connection with the use of property or rights
This type of income also covers acquisition revenue from the sale of
operating assets, unless it is property for residential purpose.
Option opportunity for income from economic activity:
Since 01/2004 those revenues can be taxed with alinear tax rate of 19% deviating
from the regular taxation (on application of the taxpayer until the 20th January
each year)
But: by chosing so, deductions from the taxable base and joint assessment with
the spouse can not be drawn on.
Taxes
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Taxation of so-called
‘cashbacks’ received
from banks, co-
operatives or other
financial institutions
will receive a flat-rate
of an income tax rate
of 19%
From 1st January, 2015, Article 30, Paragraph 1, Ref. 4b will be added to the
Personal Income Tax act (PIT), regulating that cashbacks received from banks,
co-operatives or other financial institutions are taxable with a flat-rate of 19%. This
tax will be withdrawn by banks, co-operatives and other financial institutions who
are obliged to pay cashbacks.
Private use of company
cars from January 2015
From the start of 2015 the private use of a company car up to and including an
engine size of 1,600cc (cylinder capacity) will be taxed on the basis of a assumed
cash benefit of 250.00 PLN. The tax rate will be 18%, so an employee must pay
45.00 PLN taxes (PIT) each month.
When a company car with a cylinder capacity exceeding 1,600cc, the value of the
private use will be 400.00 PLN, so the taxation amount will be 72.00 PLN.
If the employee only uses the company car only part of the month for private
purposes, then the value of compensation for each day of the private use needs
to be calculated. Therefore, the amount of tax calculated by the employee can
in fact be lower than the amount established by law. In such a case, the internal
rules of the company are crucial in calculating the amount of fringe benefits for the
private use of company cars.
Moreover, the value of the employee benefit, in the form of the collective
transportation to work, organised by the employer for his employees will be
exempt from tax, starting from the start of 2015. As a pre-condition, the vehicle
used for this purpose must be designed to carry more than 9 people including
the driver.
PRIVATE INCOME TAX (PIT) CONTINUATION
33
Our experts on
Tax and Legal advisory will
serve you with help and advice.
Taxes
Invest in Poland 2016
34
VALUE ADDED TAX (VAT)
Legal basis Act of 11 March, 2004 on the taxation of goods and services
Tax rates
Standard Tax Rate 23%
Reduced Tax Rate 8%:
(e.g. some foods, plants, associated with health goods, catering and hotel
services, transportation services, public housing)
Reduced tax rate 5%:
(Especially food, specialist books and journals)
Reduced tax rate 0%:
(Export of goods, Intra-Community supplies of goods)
General
Values Added Tax on goods and services is abroad-based tax levied on the
supply of goods and services in Poland.
Polish regulations are based on EU directives.
Registration A Polish entity is required to register for VAT once its annual turnover on
transactions subject to VAT exceeds 150,000.00 PLN. Foreign entrepreneurs
must register for VAT in Poland before they start any VAT-able activity in Poland
(except for limited and expressly listed cases). Based on the Polish Fiscal Penal
Code if an entity obliged to register for VAT purposes fails to fulfil this obligation,
it will be liable to pecuniary penalty for fiscal offence in an amount determined
individually in each case (multiples of the lowest monthly salary).
Compliance (a) Invoicing
Transactions between VAT taxpayers must be documented with invoices. The
Polish VAT laws strictly regulates the elements that should be included in invoices.
In general, an invoice should contain at least the following obligatory data:
name and surname or business name of the seller and its address
name and surname or business name of the purchaser and its address*
Polish tax identification numbers of the purchaser and the seller
sequential number of the invoice that identifies the invoice
date of issue
date of supply - if such date is determined and differs from the invoice
issue date (in the case of continuous supplies the taxpayer can indicate the
month and year of the supply)
name (kind) of goods or services
unit of measure and quantity of the goods sold or scope of the
services rendered*
unit of price of the goods or services without VAT (Net unit price)*
value of the potential rebates, including these for the earlier payment, if they
were not included in the net unit price
35
Compliance (cont.) Please note that from the beginning of 2013 so called simplified invoices were
introduced to the Polish VAT provisions. Such invoices may be applied in case the
total amount due on the invoice does not exceed 450.00 PLN or 100.00 EUR (if the
invoice is issued in EUR). Simplified invoices may not include elements of the invoice
that are marked with ‘*’ on page 26 provided that the invoice includes information
enabling to determine the value of VAT in relation to particular VAT rates.
(b) EU VAT tax
In January 2010 Polish VAT provisions were amended to accommodate the VAT
package introduced into EU legislation. Generally, the Polish provisions reflect the
VAT Directive in this respect and the services are subject to VAT in the country
where the recipient of the services is established (with certain exceptions,
especially concerning the services related to immovable property).
(c) Filing
Registered VAT taxpayers are required to submit monthly or quarterly returns to
the competent tax office and keep registers of purchases and sales subject to
VAT. Additionally, registered VAT EU taxpayers performing intra-community and
acquisitions of goods into Poland and intra-community supplies of goods and
services from Poland are also required to submit EC Listings returns on amonthly
bases (or aquarterly basis - provided certain conditions are met).
(d) Payment/refunds
The tax due to the tax authorities is calculated as the output VAT minus the input
VAT on purchase invoices.
As arule, the surplus of output VAT over input VAT must be paid within 25 days
following the month in which the VAT obligation arose (for small taxpayers, the VAT
due must be paid within 25 days following the quarter in which the VAT obligation
rose). If the input VAT exceeds the output VAT, aVAT refund is generally available.
(e) Penalties
In general, if the obligations binding upon Polish VAT taxpayers are not fulfilled, the
tax authorities may impose the penalties provided for in the provisions of the Polish
Fiscal Penal Code. Additionally, if any VAT liability arises, taxpayers are obliged to
pay the outstanding VAT amount due along with the attendant penalty interest.
Taxes
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VALUE ADDED TAX (VAT) CONTINUATION
Application to
non-residents
The entities without the status of Polish residents (i.e. seated outside Poland)
performing transactions taxable in Poland according to the Polish VAT provisions
(e.g. intra-community acquisitions of goods in the territory if Poland) are obliged
to register for VAT purposes in Poland, as aconsequence, fulfil the obligations
imposed under Polish VAT law on registered VAT taxpayers.
It should be noted however that the obligatory reverse-charge mechanism
(settlement of tax by the purchaser) was introduced on 01 April, 2011, in respect
of the supply of goods and services by foreign taxpayers that do not have their
fixed establishment for VAT purposes. Please note that starting from 01 April,
2013, the reverse-charge mechanism is not applicable (with certain exceptions) to
the supply of goods if the foreign taxpayer without fixed establishment in Poland
being asupplier is registered for VAT purposes in Poland. In such acase aforeign
supplied (not the purchaser) is obliged to charge VAT on these supplies in Poland.
Taxable supply VAT is imposed on the supply of goods and the provision of services in Poland,
the import into Poland, export of goods, intra-community acquisitions of goods
and intra-community supply of goods unless the transaction is exempt.
Deliveries The tax concerns a paid delivery of goods, which also includes, inter alia, a
gratuitous transfer of part of the company goods, the right to deduct input tax
on the acquisition by the state, provided that the taxpayer had the right to deduct
such input tax on the acquisition or manufacturing of such goods.
Gratuitous transfers A gratuitous transfer of gifts of small value and samples are not subject to taxation,
as long as it is made for associated with the business purposes. Handovers of
publicity and information printing materials are now generally not excluded from
taxation. anew definition of the sample has been introduced.
Place of supply of
goods
The goods from the supplier, purchaser or a third party dispatched
or transported - place where the goods are located at the beginning of
transportation or shipment to the purchaser
The goods are not dispatched or transported - the place where the goods
are located at the time of delivery
Services Principally these are all services that are not goods. Tax base is the amount by
which the service has been paid.
37
If you have questions related to particular
tax topics, please contact us at your earliest
convenience.
Taxes
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38
Place of performance Rule:
Place of service in favour of ataxpayer (businessman) is the location of its
registered ofce (or fixed place of management or permanent residence)
Place of service in favour of asubject who is not an entrepreneur (consumer),
is the country of the seat (or fixed place of management or fixed place of
residence) of the power generator
Exeptions:
Intermediation services in favour of final consumers - place of the primary
activity with real estate related services - location of the property
Transportation services:
» Transport of persons - the place of transport, taking into account the
distances covered
» Transport of goods in favor of consumers - the place of transport, taking
into account the distances covered
» Transport of goods in favour of consumers, the beginning and the end
of the movement on the territory of two different member states take
place - the place of commencement transport
Support services to the transport services - place of activity execution
Services in the field of arts, culture and nature of the sport, science,
education, entertainment:
» In favour of contractors - Application is the basic rule (location of the
seat of the contractor)
» Favor of consumers - the place of activity execution
» Admission to an event (business and consumer) - location of event
Restaurants and catering services - place of activity execution
Short term rental of means of transport - place where the means of
transport is actually put at the disposal of the customer
VALUE ADDED TAX (VAT) CONTINUATION
39
Place of performance
(cont.)
Electronic services:
» In favor of contractors - application is the basic rule (location of the seat
of the contractor)
» In favour of final consumers
Based / resident outside the EU or based / resident in the EU, where the
services are provided from athird country by aresident service suppliers -
location of the seat / domicile of the beneficiary
Based / resident in the EU, where the services are provided from an EU
Member State by aresident service suppliers - location of the seat (or fixed
place of management or fixed place of residence) of the power generator
Intangible services (e.g. sale of rights, advertising, legal, banking, financial
and insurance services, supply of staff) in principle apply the basic rule
exception applies only to consumers, have the office / residence in athird
country - location of the seat / residence of the beneficiary
Telecommunications, radio and television broadcasting services -
exemptions, if the services are rendered for the benefit of end users vary by
domicile / residence of both the provider and the service recipient
Services in the tourism sector - location of the seat (or fixed place of
management or fixed place of residence) of the power generator
New special
procedure for
the VAT rules on
telecommunications,
radio and television,
as well as on
electronic services
Effective from 1st January, 2015, there is a new VAT procedure for
telecommunications, radio and television, as well as electronic services supplied
to non-taxable persons. This will include all services to private consumers
supplied by entities/persons which are established in the EU and which are not
located in the country of consumption (EU), according to Article 130a-130d of VAT
Act. All previous provisions defining the place of performance of these services
(Article 28m of VAT Act) are lifted with effect from 1st January, 2015.
According to these amendments the place of performance will always be the
legal domicile, the place of residence or habitual residence of the non-taxable
consumer (Article 28k of VAT Act) of telecommunications, radio and television, as
well as electronic services. This shall apply regardless of supplier’s status and the
location of his business activities.
Changes will also be made in relation to foreign entities (entities not resident or
have a permanent place of business within the territory of the EU).
Taxes
Invest in Poland 2016
40
Reverse Charge
“Reversal of the tax
liability“
Requires the performing entrepreneur is a foreigner (in Poland has neither
aresidence nor fixed place of management) and the receiver is Polish VAT payers.
Invoices without VAT, reference on passage of tax liability, tax identification
numbers of the entrepreneurs, both supplier and beneficiary.
As of 01 January, 2013, the foreign trader is obliged to settle the tax:
if he provides real estate related services, and is registered for VAT
purposes in Poland, in the case of other services, the control of the Polish
beneficiaries must be settled
in the case of goods trade, the foreign supplier is obliged to settle the tax if
he/she for VAT purposes in Poland
Clearing of the
supplies, for which the
buyer stays tax liable
(reverse charge)
So far, the reverse charge procedure was in any case the acquisition of goods by
foreign taxpayers who have in Poland neither seat nor fixed place of management,
application. Since 01.04.2013 the reverse charge procedure does not apply if
the foreign supplier is registered as aPolish VAT. In such acase the sales tax is
charged according to the general rule.
Real estate VAT is owed by the purchaser.
Rental Subject to VAT in either case.
Sale Subject to either the VAT or the tax on civil law transactions. The latter is payable
if the VAT exemption or neither side VAT payer is.
Tax exemption Distinction concerning 0% tax rate or exemption
0% Tax Rate Inter alia
Intra-Community supplies of goods
Export of goods
specific costs directly linked to the export of commodities related services,
international transport services
Services in the scope of processing and refinement of goods
VAT exemption inter
alia
Delivery of second-hand goods used solely for the purposes of an activity
exempt (net of tax)
Financial services (provision of loans, management of bank accounts,
money exchange) with the exception of leasing, factoring or advice
Insurance and re-insurance services
certain medical services
certain education services
Services in the area of social welfare
Services in the area of social insurance
Certain services in the area of culture or sport
VALUE ADDED TAX (VAT) CONTINUATION
41
Input tax reduction No deduction for the purchase of accommodation services as well as catering
services.
VAT deductible amount to depend on what the vehicle is used for
The rules of VAT deductibility on motor vehicles with permission maximum
weight not exceeding 3.5 tonnes change from 01 April, 2014. The deductible
amount depend on what ataxpayer uses the vehicle for. If acar is used for mixed
purposes, that is, for both business and private use, the right to deduct limited.
But if a taxpayer uses a car exclusively for own business purposes, they are
entitled to deduct the full VAT amount. A full right to deduct shall also apply when
a motor vehicle is structurally designed to transport at least 10 persons including
the driver (must follow from vehicle documents).
Limited deductibility - not only VAT on purchase
If amotor vehicle with the permissible maximum weight not exceeding 3.5 tonnes
is used for both business and private use, the taxpayer will be entitled to deduct
50% of VAT. This applies not only to VAT on purchase, ICA or import of vehicles
(as it used to be), but also to VAT on repair, operation and purchase of component
parts. The 50% limit is not capped by any amount. Consequently, the taxpayer
will be entitled to deduct 50% of VAT regardless of the VAT amount shown in the
invoice. The 50% limit will also apply to vehicles used under lease, rental or similar
agreements.
Unlimited deductibility - recording obligations
The taxpayer will be entitled to deduct 100% of VAT provided that the vehicle is
used exclusively for the taxpayer’s business activity purposes. Furthermore, the
following conditions must be met:
The taxpayer must establish the rules of using the vehicle saying that they
may be used exclusively for the taxpayers business purposes
A vehicle mileage logbook must be kept for the vehicles used exclusively for
the taxpayers business purposes.
The vehicle mileage logbook should include, without limitation: vehicle registration
number, logbook’s start and end date; odometer count and number of kilometres
driven. It should be kept starting from the date when avehicle is used exclusively
for the taxpayer for the taxpayer’s business activity.
If the taxpayer fails to file the above-mentioned information on time, his vehicle will
be considered to be used exclusively for business purposes only after the day the
information is filed.
Taxes
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42
VALUE ADDED TAX (VAT) CONTINUATION
Input tax reduction
(cont.)
Information filing deadlines
Taxpayers who are going to use cars exclusively for business purposes, for which
alogbook will be kept, will be obliged to notify the head of competent tax office
of the vehicles used exclusively for business purposes (VAT-26 form). The VAT-26
information should be filed within statutory deadlines.
Liability for breach of the information obligation
A taxpayer who fails to file the VAT-26 information on time or who provides false
information, and deducts 100% of VAT at the same time, is subject to penal and
fiscal liability (fine of up to 720 so-called daily rates, where such daily rates range
from 56.00 PLN to as much as 22,400.00 PLN).
Fuel - no deduction until 30 June, 2015
VAT on purchase of fuel for, amongst other things, passenger cars, cannot be
deducted until 30 June, 2015. This limitation does not apply to vehicles used
exclusively for business activity purposes.
Car lease - contract made before 01 April, 2014
The 50% deduction limit does not apply to lease instalments, rent etc. for vehicles
used under alease, rental or similar agreements made before 01 April, 2014, on
which the entire VAT amount invoiced is deductible as of 31 March, 2014.
Fundamental period - 60 days from the date of filing the tax return,
shortening to 25 days possible (assuming all reported in the tax return
accounts must be settled at the time of filing the tax return)
180 days - if in agiven billing period no taxable transactions were made
Foreign companies Companies that do not have aseat or fixed place of management in Poland.
Registration of
foreign companies
Principally there is no obligation to register.
Re-imbursement of
input tax for foreign
companies
Can be filed for:
Application in Polish language for entrepreneurs from the EU - in electronic form
Appropriate Revenue Office: II Warsaw-Srodmiescie
The application can cover a period of minimum 3 months and can not
exceed 1 year
Handing over until the 30th of September of the following year
Issued by the tax ofce on the amount of the recognised tax is generally
issued within 4 months from the application levy
Reimbursement will be made within 10 working days of the decision
Intra-Community
transport
Intra-Community acquisition
Intra-Community supply
43
Intra-Community
supply (to registered
entrepreneurs)
Provided that the following conditions are fulfilled, atax rate of 0% in Poland will
be applied:
The supply was carried out towards an entrepreneur registered for VAT-
purposes in another membership country of the European Union, and
The goods have left Poland and the supplier has appropriate evidence, and
The supplier has mentioned the correct tax identification number on
the invoice
To end users The taxation on supplies of goods to consumers (private individuals) in another
membership country of the European Union takes place in Poland.
Exceptions:
Means of transport, inter alia passenger cars, are always taxed in that
country to which the consumer ships the new means of transport
Mail order business (the goods will be dispatched on behalf of the supplier
in favour of final consumers, provided that the value of the sold goods
exceeds on the side of the supplier acertain price limit)
Reporting
requirements
Summing up reports are to be delivered in general on amonthly base
To be captured:
» Intra-community deliveries of merchandise
» Intra-community purchases
» Deliveries under the so-called intra-Community supply triangle
» Services to foreign companies (from EU Member States), in which the
tax liability to beneficiaries passes
When the tax
changes become
chargeable
The tax liability will no longer depend on the invoice date. Generally the tax liability
will arise when goods are supplied or services are rendered. Most of the changes
in force are concerning special tax liabilities that will be repealed and replaced by
new arrangements.
Taxes
Invest in Poland 2016
44
Definitions of the tax
base
The modifications of the rules is the direct implementation of the definition
contained in the VAT directive. The new tax base includes all payments, which
have a direct impact on the price of goods and services rendered by the taxpayer.
The new VAT regulation explicitly mentioned what is included in the tax base,
like additional costs (commissions, packing and transportation costs, as well as
insurance costs). In case of free deliveries or services the values or comparable
prices of the goods and services concerned will build the new text base. If there
are no comparable prices the tax base includes all costs incurred at the tax point.
Time restrictions
on the deduction of
input tax
The right of deduction arises in the period in which the seller’s tax liability, in
relation to the goods or services supplied become chargeable, but should not be
earlier than in the tax return for the period in which the buyer received the invoice
or customs documentation. Therefore, it is very important from 1st January,
2014, that you are certain when the tax liability has arisen due to the documented
through the relevant invoice.
The regulations give you the right to deduct intra-Community acquisitions of
goods from the receipt of the seller’s invoice. If you do not receive the invoice
within 3 months, the taxpayer will have to make a corresponding adjustment i.e.
reduction of input tax claimed. The correction of the reduced deduction will be
possible at the time the invoice was received.
Invoicing
requirements
The most significant change in terms of invoicing, which entered into force on 1st
January, 2014, is the possibility of invoicing no later than the 15th day following the
month when the goods were supplied or services rendered. It is also possible to
issue the invoice prior to the time of delivery or performance, but not earlier than
30 days before that date.
Changes in VAT
2016 - prefactor
From 2016 a preproportion was introduced which relates to VAT deduction on
expenditures for both the business activities and activities of a different nature,
which cannot be fully attributed to only one of the two categories of activities. This
change is of great importance in particular for local government units, performing
their own tasks which go beyond VAT and activities on the basis of civil law
contracts subject to VAT, but also any taxpayer whose activities go under VAT
and activities falling outside the scope of the VAT Act.
The method of calculating the prefactor was left to the taxpayer, with the VAT Act
introducing a catalogue of illustrative data that can be taken into account:
personnel data
area data
financial and trading data
time-related data.
VALUE ADDED TAX (VAT) CONTINUATION
45
Taxes
Changes in VAT 2016
- prefactor (cont.)
The choice of the method used to calculate the value of the prefactor is free, but
the preindicator must be representative and meet the specifics of the taxpayer‘s
business.
The regulation introduced in 2016 significantly restricts the right to deduct input
VAT for taxpayers engaged in mixed activities (VAT and non-VAT).
Invest in Poland 2016
46
Control measures The formal correctness of the tax declaration stands in the focus of the control.
A separate tax bill is not created.
Audit of the Tax
Office
Determination of the tax liability on the merits and amount.
The revenue ofce issues aprotocol thereafter, which can serve as evidence in
atax proceeding.
Control method It is determined whether the taxes were paid on time.
If default interest accrues, the tax authority shall issue atax assessment in the
amount of tax due and default interest are fixed.
Tax audit performed
by the finance control
group
It is checked whether the taxpayer has declared his tax liabilities on the merits
and the amount properly; If atax liability determined, aseparate tax bill enacted.
Tax payers can draw on in Poland in fiscal matters on the following rights:
Appeal against adecision
Complaint to the Provincial Administrative Court
Nullification suit with the supreme administrative court
Legal action with the European court of justice
TAX AUDIT AND LEGAL RECOURSE IN POLAND
Ruling Yes, relating to the fiscal circumstances of atax payer possible
Consequences of
delay by failure to
meet the deadlines
and dates
Delay penalties: currently 14% per annum (9.75% p.a. - of reduced sentence in
the case of delivery of an effective correction of atax return before the activity of
the tax office)
Penalties for late payment: only for VAT - up to 30% of the tax liability
Criminal Tax Law Financial Criminal Law
Punishment for negligent tax evasion: Criminal Charges
Penalty for willful tax evasion: Financial or Imprisonment
In principal administrative proceedings
GENERAL TAX LAW
Purchase of real estate: 2.0%
Memorandum of association: 0.5%
Loans: 2.0%
Proprietor/Shareholder-loans: 0.5%
TAXES ON CIVIL AGREEMENTS (PCC)
47
Fiscal 8% per annum
Legal 14% p.a.
Reduced rates For tax arrears incurred from 1 January, 2016, a reduced rate of interest
is applied equal to a half of the standard rate (currently 4%), subject to the
submission of a corrected tax return, in person, without the intervention of
the tax authority, within 6 months from the date of expiry of the deadline to
submit such tax return and the payment of tax arrears within 7 days from
the date of submitting such correction.
The rate reduced by half (currently 4%) will also apply to tax arrears
generated prior to 1 January, 2016, subject to the submission of a
corrected tax return from 1 January to 30 June, 2016, and the payment
of tax arrears within 7 days from the date of submitting such correction.
Therefore you are encouraged to verify the correctness of the submitted tax
return independently, and, if errors are disclosed, submit the correction and
pay any arrears within this period. The reduced rate shall apply regardless
of the amount of disclosed arrears. If the correction disclosing tax arrears
incurred before 1 January, 2016, is submitted after 30 June, 2016, the rate
of default interest shall be 3/4 of the standard rate (currently6%).
Increased rate From 1 January, 2016, an increased rate of default interest was introduced
in the amount of 150% of the standard rate (currently 12%) in relation to the
arrears in the tax on goods and services, excise duty and customs duty.
This rate shall be applied if the tax authority detects in the course of its
tax procedures (verification activities, tax audit or tax proceedings) an
understatement of tax liabilities (overestimation of overpayment or tax
refund) in the amount exceeding 25% of the amount due and higher than
the amount of 9250.00 PLN (5 x minimum salary), or the lack of the tax
return and tax payment.
However, even for these taxes if an independent verification of the
correctness of the submitted tax return is made, and, if errors are
disclosed, the correction is submitted and the payment of arrears is made,
the reduced rate shall apply. The reduced rate shall apply regardless of the
amount of disclosed arrears.
It is therefore in the best interest of taxpayers to verify the tax return,
submit the correction and pay arrears independently. This shall allow for
applying a reduced rate.
INTEREST
Taxes
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DOUBLE TAXATION AGREEMENT (DTA)
Double Taxation Agreement (DTA):
Poland concluded Double Taxation Agreements (DTA’s) with 81 countries, which comply with the OECD
Model convention.
Governance of the right for taxation looks differently in the case of share disposals in real estate companies.
Following the OECD Model Convention, for those Double Taxation Agreements (DTAs) marked with ‘yes’, the
country of location of the real estate possesses the right for taxation vis-a-vis share deals, and not the country of
residence/domicile of the seller.
Tax rates mentioned in the Double Taxation Agreements (DTAs) can be applied only then, when the tax payer
possesses and provides acertificate of residence issued by the Inland Revenue office of the applicable country.
TAX LIMITS IN 2016
In 2016, current income
limits concerning inter
alia status of small-
business enterprises
Small-business enterprises (mały podatnik) for VAT and Personal Income Tax:
5,092,400.00 PLN
Income limit that entitles lump-sum of taxation of recognised income:
636,555.00 PLN
The amount of net income that requires to bring records of accounts by
individuals, partnerships of individuals, partnerships of individuals, partnerships
and social co-operatives - 5,092,440.00 PLN
Maximum total amount of depreciation in a year, as part of one-off depreciation
- 212,000.00 PLN
49
COUNTRY
ENTRY INTO FORCE PROPERTY CLAUSE DIVIDENDS IN% INTERESTS IN% LICENSES IN%
ALBANIA
27.06.94 no 5/10 10 5
ARMENIA
27.02.05 yes 10 5 10
AZERBAIYESN
20.01.05 yes 10 10 10
AUSTRALIA
04.03.92 yes 15 10 10
BELGIUM
29.04.04 yes 5/15 0/5 0/5
BULGARIA
10.05.95 no 10 0/10 5
CHINA
07.01.8 9 no 10 0/10 7/10
DENMARK
31.12.02 yes 0/5/15 0/5 5
GERMANY
19.12.04 yes 5/15 0/5 5
ESTONIA
09.12.94 no 5/15 0/10 10
FINLAND
30.03.79 no 0/5/15 0 0/10
FRANCE
12.09.76 yes 5/15 0 0/10
GREECE
28.09.91 no 19 10 10
GREAT BRITAIN
27.12 .0 6 yes 0/10 0/5 5
INDIA
26.10.89 yes 15 0/15 20
INDONESIA
25.08.93 no 10/15 0/10 15
IRELAND
22.12.95 yes 0/15 0/10 0/10
ICELAND
protocol - 08.12.12 yes 5/15 0/10 10
ISRAEL
30.12.91 yes 5/10 5 5/10
ITALY
26.09.89 no 10 0/10 10
YESPAN
23.12.82 no 10 0/10 0/10
CANADA
08.12.12 yes 0/5/15 10 5/10
KAZAKHSTAN
13.05.95 yes 10/15 0/10 10
KOREA
21.02.92 no 5/10 0/10 10
CROATIA
11.02.96 yes 5/15 0/10 10
KUWAIT
25.04.00 no 0/5 0/5 15
LATVIA
30.11.94 yes 5/15 0/10 10
LITHUANIA
19.07.9 4 yes 5/15 0/10 10
LUXEMBOURG
protocol - 11.12.12 yes 0/15 0/5 5
(*) Exemption from withholding tax pursuant to the directive on rulers and controlled companies (Parent-Subsidiary-Directive)
Taxes
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50
(*) Exemption from withholding tax pursuant to the Directive on rulers and controlled companies (Parent-Subsidiary-Directive)
COUNTRY
ENTRY INTO FORCE PROPERTY CLAUSE DIVIDENDS IN% INTERESTS IN% LICENSES IN%
MALAYSIA
05.12.78 no 0 0/15 0/15
MALTA
24.11.94 yes 5/15 0/10 10
THE
NETHERLANDS
18.03.03 no 5/15 0/5 5
NORWAY
29.01.13 yes 0/15 5 5
AUSTRIA
01.04.05 yes 5/15 0/5 5
THE PHILIPPINES
07.04.9 7 yes 10/15 0/10 15
PORTUGAL
04.02.98 no 10/15 0/10 10
RUMANIA
15.09.95 no 5/15 0/10 10
RUSSIA
22.02.93 no 10 0/10 10
SAUDI ARABIA
01.0 6.12 yes 5 0/5 10
SWEDEN
15.10.05 yes 5/15 0 5
SWITZERLAND
25.09.92 no 5/15 10 0/10
SINGAPORE
Probably
in 2013
yes 0/5/10 0/5 2/5
SLOVAKIA
21.12.95 no 5/10 0/10 5
SLOVENIA
10.03.98 no 5/15 0/10 10
SPAIN
06.05.82 yes 5/15 0 0/10
SOUTH AFRICA
05.12.95 no 5/15 0/10 10
THAILAND
13.05.83 no 20 0/10 5/15
CZECH REPUBLIC
13.0 6.12 no 5 0/5 10
TUNISIA
15.11.93 no 5/10 12 12
TURKEY
01.10.96 no 10/15 0/10 10
UKRAINE
11.03.94 yes 5/15 0/10 10
HUNGARY
10.09.95 no 10 0/10 10
USA
23.0 7.9 6 yes 5/15 0 10
UNITED ARAB
EMIRATES
21.04.94 no 0/5 0/5 5
BELARUS
30.07.93 no 10/15 0/10 0
CYPRUS
Protocol -09.11.12 no 0/5 0/5 5
CONTINUATION
51
Ruling Polish employers have to pay social security costs and compulsory insurances to
the social insurance office (Zaklad Ubezpieczen Spolecznych) and to the National
Health Fund. The employer is responsible for withholding and remitting the full
amount of social security contributions (employees share and employer’s share)
to the relevant authorities. The rates of social security contributions for 2014 are:
Fund Employer Employee
Pension/retirement fund 9.76% 9.76%
Disability insurance 6.5% 1.5%
Sickness benefits Not applicable 2.45%
Accident insurance Between 0.67% and
3.33%
Not applicable
Health insurance Not applicable 9.00%
The employer and employee pay contributions to the pension and disability funds.
The 9.76% employee contribution is transferred to the Open Pension Fund.
Contributions by employees are based on their gross income tax purposes. The
ceiling on income on which contributions for the pension and disability insurance
are due is 121,650.00 PLN in 2016. There is no ceiling for health insurance.
In addition, 9% of gross pay (less contributions for pension and disability
insurance) for obligatory health insurance contributions (covering medical
expenses) is payable by employee.
The 2.45% sickness benefit is paid into Labour Fund.
Social security in
Poland
The social security system in Poland is of ageneral and compulsory character.
Social security - in respect of selected risks - covers persons who are, inter alia,
employees, persons who work on the basis of contracts of mandate or who carry
out business activity.
NOTE:
Social security in Poland covers the EU citizens on the same basis as
Polish citizens.
SOCIAL SECURITY CONTRIBUTIONS
Social security
Invest in Poland 2016
52
SOCIAL SECURITY CONTRIBUTIONS CONTINUATION
Pension insurance Pension insurance is an insurance provided in the event of inability to work
because of old age. Persons who pay premiums, ensure their income at the
moment of stopping professional work, after achieving pensionable age.
The reform of the pension system entered into force on 01 January,
1999. It introduced athree-pillar system:
Pillar I is governed by the public institution - Social Insurance Company
Pillar II is governed by private institutions - open pension funds (OFE) - An
open pension fund is alegal person whose aim is to collect funds from
insurance premiums and invest them on the financial market. Those funds
are designated for pensions for the open pension fund‘s members when
they reach pensionable age
Pillar III, voluntary, which is to ensure extra benefits for additional
premiums, is occupational pension schemes (PPE) and individual
retirement accounts (IKE)
From 01 May, 2011 until 31 December, 2016 the Social Insurance
Company forwards part of the pension insurance premium to the
open pension fund selected by the insured person, in the amount of:
2.3% of the basis of the assessment of the amount of the pension insurance
premium due for the period from the date of entry into force of the Act until
31 December, 2012
2.8% of the basis of the assessment of the amount of the pension insurance
premium due for the period from 01 January, 2013, until 31 December, 2013
3.1% of the basis of the assessment of the amount of the pension insurance
premium due for the period from 01 January, 2014, until 31 December, 2014
3.3% of the basis of the amount assessment of the of the pension insurance
premium due for the period from 01 January, 2015, until 31 December, 2016
The account of the insured person at the Social Insurance Company includes
asub-account where information is recorded on the valorised amount of paid
premiums to Pillar II from the part of the premium not forwarded currently to
open pension funds, together with the recovered interest on arrears for those
premiums. The division of the premium between the pension fund which is at the
Social Insurance Company’s disposal and an open pension fund is obligatory
for insured persons born after 31 December, 1968. Insured persons born after
31 December, 1948, and before 01 January, 1969, could join aselected open
pension fund until 31 December, 1999. Persons born before 01 January, 1949,
could not and still cannot join an open pension fund, their whole premium is
forwarded to the Social Insurance Fund.
53
Pension insurance
(cont.)
In 2014, there was a change concerning Insurance Pillar II. The insured were
making a choice whether to use the services of OFE (Open Pension Funds)
and their sub-accounts in ZUS (Social Insurance Company), or move their
funds entirely on their sub-accounts in ZUS. Another such opportunity, which
can also happen in the other direction, will take place in 2016, and then every
4 years.
The act introducing the voluntary nature of the transfer of contributions to OFE
also provides for the so-called transfer windows, during which the insured
may again decide whether they want to have their pension contributions to be
evidenced on the sub-account in ZUS (4.38%) and in part transferred to OFE
(2.92%), or fully evidenced on their sub-accounts in ZUS (7.3%).
The pension premium is financed equally by the employer and the insured
person, but the whole premium paid to the open pension fund is from the part
paid by the insured person. The employer is responsible for paying premiums
to the Social Insurance Company.
The pension system is based on the tight connection between the amount
of the benefit and the amount of the actually paid premium. The basis for
calculating the pension is the (total) amount of premiums for pension insurance.
Pension is granted to women who are at least 60, and men who are at least
65. There is no minimum insurance period required for granting the pension.
Decisions about granting pensions are made by the Social Insurance
Company‘s bodies which are of proper jurisdiction due to the place of living
of the person who is applying for the benefit. The proceedings for granting
pensions start after submitting the application by an applicant.
Social security
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Disability insurance Disability insurance guarantees cash benefits in case of losing income
connected with the risk of disability (inability to work) or death of abreadwinner
in afamily. In such asituation persons who pay disability insurance premiums
are granted disability pension for incapacity for work, which is asubstitution for
remuneration or income, and in the case of death of an insured breadwinner in
afamily, the members of their family are granted family pension.
The premium for disability insurance is 8% of the basis of the assessment of
the amount of premium, where 6.5% is from the funds of the employer, and
1.5% from the funds of the employee.
1. Disability pension for incapacity for work
Disability pension for incapacity for work can be granted to an insured person
who fulfils all of the following conditions:
Is considered aperson who is partially or entirely unable to work
Has proven contributory and non-contributory periods
Inability to work started in the periods strictly set out in the Act
A person who is entirely unable to work is aperson who has lost the ability to
perform any job.
A person who is partially unable to work is aperson who to aconsiderable
degree lost their ability to perform ajob which is consistent with the level of
that person‘s qualifications.
Inability to work and its level is certified by a board certified occupational
medicine physician from the Social Insurance Company as the first certifying
instance. An applicant has the right to raise an objection to the physician‘s
opinion to the Social Insurance Company Medical Board - as the second
certifying instance.
2. Family pension
Family pension is granted to entitled family members (children, widow,
widower, parents) of aperson who at the moment of death took pension or
disability pension for incapacity for work, and a working person who had
the required periods for granting pension or disability pension for incapacity
for work. When analysing the right to the family pension, it is assumed that
adeceased person was entirely unable to work.
SOCIAL SECURITY CONTRIBUTIONS CONTINUATION
55
Disability insurance
(cont.)
3. Training allowance
Training allowance is granted to a person who fulfils the conditions for
granting disability pension for incapacity for work, and with reference to
whom retraining was stated as appropriate due to the inability to work in the
current profession. It is granted for the period of 6 months. That period can be
shortened or lengthened up to 30 months. The amount of training allowance
is 75% of the basis of an assessment, and when the inability to work is the
result of an accident at work or occupational disease - 100% of the basis of
its assessment.
Social security
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Social security for
industrial accidents
and occupational
diseases
Security for industrial accidents and occupational diseases covers, inter alia,
employees, persons who work on the basis of contracts of mandate, and
persons carrying out business activity.
Benefits for industrial accidents and occupational diseases can be granted to
aperson who is insured for such cases. These are:
Sickness benefit - for an insured person whose inability to work has been
caused by an industrial accident or occupational disease
Rehabilitation benefit - is paid after the sickness benefit has finished,
if the insured person is still unable to work, and further treatment or
rehabilitation give them achance to regain ability to work
Compensating benefit - is for an insured person who is an employee,
whose remuneration was lowered due to permanent or long-term damage
to their health
One-time compensation - for an insured person whose health was damaged
permanently or for along period of time, or for the members of the family of
adeceased insured person or aperson who collected disability pension
Disability pension for an industrial accident or occupational
disease - for an insured person who has become unable to work due to an
industrial accident or an occupational disease
Training allowance - is granted to a person with reference to whom
retraining was stated as appropriate due to the inability to work in acurrent
profession because of an industrial accident or occupational disease
Family pension- for the family members of adeceased insured person
or a person entitled to disability pension for an industrial accident or
occupational disease and allowance to family pension - for an orphan
Attendance allowance - for a person who is entitled to pension,
considered entirely unable to work and existence on their own, or who is
over 75
Covering the costs of treatment - in the field of dentistry and preventive
vaccination and supply of orthopaedic equipment, within the scope
stipulated by the Act
The amount of the accident security premium varies from 0.67% to 83.86%
of the basis of premium assessment. The accident security premium is entirely
covered by the employer.
SOCIAL SECURITY CONTRIBUTIONS CONTINUATION
57
Social security
for sickness and
maternity
Persons who are obligatorily insured for sickness and maternity are mainly
employees. Persons covered by obligatory pension and disability pensions
insurance, who, inter alia: work on the basis of an agency agreement or contract
of mandate, carry out non-agricultural activity (business activity, authors, artists,
freelancers) can also be insured, voluntarily, for sickness and maternity.
The amount of premium for insurance for sickness and maternity is 2.45% of
the basis of the premium assessment. The premium is covered from the insured
person’s funds.
The following benefits are paid due to insurance in case of sickness and maternity:
Sickness benefit
The sickness benefit is granted to an insured person who became ill during the
period of sickness security. Generally, the right to the sickness benefit is granted
after the so-called waiting period. aperson who is obligatorily covered by sickness
security, gains the right to the sickness benefit after the period of 30 days of
continuous sickness security. aperson who is covered by this security voluntarily,
gains it after the period of 90 days of continuous sickness security.
The sickness benefit is granted to an insured person in the amount of 80% of the
basis of assessment, and for the period of being hospitalised - in the amount of
70% of the basis of assessment.
If the inability to work which was caused due to an accident on the way to or from
work started during pregnancy or concerns tissue, cell or organ donors, then the
sickness benefit is paid in the amount of 100% of the basis of assessment.
Rehabilitation benefit
The rehabilitation benefit is granted to an insured person who can no longer be
given the sickness benefit but still is unable to work, and further treatment or
rehabilitation give them achance to be able to work again. The benefit is granted
for the period necessary to give them achance to regain ability to work but not
longer than for the period of 12 months.
Compensating benefit
The compensating benefit is granted only to insured persons who are employees.
That benefit is granted to employees whose remuneration was lowered due to
undergoing professional rehabilitation or who was moved to another post due to
the state of health.
Social security
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Social security
for sickness and
maternity (cont.)
Maternity allowance
Maternity allowance is granted to an insured woman who at the time of sickness
security or at the time of achild care leave:
gives birth to achild
takes a child up to 7 years of age for upbringing, and in the case of
achild with regard to whom there was adecision about an adjournment
of compulsory education - up to 10 years of age, and who started legal
proceedings for adoption in the Guardianship Court
takes for upbringing, as surrogate parents, except for professional surrogate
parents not related to the child, achild up to 7 years of age, and in the case
of achild with regard to whom there was adecision about an adjournment
of compulsory education - up to 10 years of age
Provisions concerning the right to maternity allowance in the case of taking achild
for upbringing are also to be followed in the case of an insured man.
Maternity allowance is paid during the period of maternity leave - for 20 weeks
in the case of giving birth to one child (possibly longer, in the case of giving birth
to more than one child at atime - from 31 weeks to maximum 37 weeks) and
throughout the period of the additional maternity leave.
Maternity allowance can be also granted to an insured father of achild for the
period of 2 weeks as the period of maternity leave which can be granted to an
employee-father raising achild.
The amount of maternity allowance is 100% of the basis of the allowance
assessment. The basis of the allowance assessment is an average monthly
remuneration paid for the period of 12 months before the month in which the right
to the allowance is created.
Premiums for pension and disability pension insurance are calculated from
maternity allowance (Those premiums are financed from the State budget).
Parental leave is granted immediately after maternity leave or maternity allowance
is used by an employee for a period equal to the period of maternity leave by
the insured person who is not an employee, in no more than 4 parts which are
multiples of a week, falling directly one after another or immediately after using
maternity allowance for the period corresponding to a part of parental leave.
SOCIAL SECURITY CONTRIBUTIONS CONTINUATION
59
Social security
for sickness and
maternity (cont.)
Maternity allowance for the period specified in the Labour Code provisions as a
period of parental leave is granted for up to:
32 weeks - in the case of the birth of one child and for the adoption for
upbringing and to apply to the guardianship court for instituting proceedings
for adoption or acceptance of upbringing as a foster family with the
exception of a professional foster family of one child up to the age of seven,
and in the case of a child towards whom it was decided to postpone the
compulsory schooling up to the age of ten, hereinafter referred to as “the
adoption of a child for upbringing”
34 week - in the case of the birth during one delivery of two or more children
and in the case of a simultaneous adoption for upbringing of two or more
children
29 weeks - in the case of adoption of a child for upbringing, when the
employee is entitled to a minimum maternal leave of 9 weeks.
The maternity allowance for the period corresponding to the period of parental
leave can also be used by both parents at the same time, however, the total period
of the leave enjoyed by both parents must not exceed 32, 34 or 29 weeks.
Attendance allowance
Attendance allowance is granted for the period of a special leave, when it is
necessary to take care of ahealthy child who is under 8, asick child who is under
14 or other sick member of the family.
Attendance allowance is granted for not more than 60 days in acalendar year if
aperson takes care of ahealthy child who is under 8 or asick child who is under
14. If aperson takes care of asick child who is over 14 or other sick member of
afamily, the allowance is granted for not more than 14 days. The allowance is paid
in the amount of 80% of the basis of allowance assessment.
Additionally, in the case stipulated in Article 180(61) of the Labour Code, the
insured father of achild is entitled (irrespective of the attendance allowance for
60 days per calendar year) to an attendance allowance in the amount of up to 8
weeks if he interrupts employment or other gainful activity in order to take care
of the child.
Social security
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SUMMARY OF THE MOST SIGNIFICANT CHANGES IN CIT
- CHANGES EFFECTIVE FROM 1 JANUARY 2016
LIMITATION OF OBLIGATION OF RETROACTIVE
ADJUSTMENT OF REVENUES
As of January 1, 2016, Article 12 paragraph 3j was added to the Corporate Income Tax Act,
from which it follows that the adjustments of revenues should be accounted for:
1) retroactively - within the scope in which adjustments are due to accounting errors or any
other obvious mistakes,
2) on a regular basis (i.e. in the accounting period in which a corrective invoice was issued or,
in the absence of such invoice, other document confirming the causes for adjustment) - in
other cases (whereby in the event of the revenues in the accounting period being too low,
taxpayers shall be obliged to increase the tax deductible costs by the amount by which
the revenues were not reduced - see, Article 12 paragraph 3k of the CIT Act added as of 1
January, 2016).
LIMITATION OF OBLIGATION OF RETROACTIVE
ADJUSTMENT OF TAX DEDUCTIBLE COSTS
As of January 1, 2016, Article 15 paragraph 4i was added to the CIT Act, from which it
follows that the adjustments of tax deductible costs, including depreciation and amortisation,
should be accounted for:
1) retroactively - within the scope in which adjustments are due to accounting errors or any
other obvious mistakes,
2) on a regular basis (i.e. in the accounting period in which a corrective invoice was received
or, in the absence of such invoice, other document confirming the causes for adjustment)
- in other cases (whereby in the event of the tax deductible costs in the accounting period
of the adjustment being too low, taxpayers shall be obliged to increase the revenues by the
amount by which the tax deductible costs were not reduced - see, Article 15 paragraph 4j
of the CIT Act added as of 1 January, 2016).
LIQUIDATION OF OBLIGATION OF REDUCING THE TAX
DEDUCTIBLE COSTS BY OUTSTANDING AMOUNTS
CLASSIFIED AS SUCH COSTS
As of January 1, 2016, Article 15b of the CIT Act is repealed. Thus from the beginning of
2016 taxpayers are not required to reduce the tax deductible costs by outstanding amounts
classified as such costs at dates specified by regulations.
INTRODUCTION OF OBLIGATION OF SUBMITTING
SIMPLIFIED STATEMENTS ON TRANSACTIONS OR
OTHER EVENTS TAKING PLACE BETWEEN RELATED
ENTITIES
As if January 1, 2016, Article 27 paragraph 5 was added to the CIT Act. This provision
imposes on some taxpayers obliged to draw up tax documentation (i.e. those whose
revenues or costs, within the meaning of accounting provisions, exceeded in a fiscal year
an equivalent of 10,000,000.00 EUR) the obligation to submit to the tax return for the fiscal
year, a simplified statement on transactions with related entities or other events taking place
between related entities, or in relation to which the payment shall be paid directly or indirectly
to an entity having their place of residence, registered office or management on the territory
or in the country applying harmful tax competition.
INTRODUCTION OF OBLIGATION OF SUBMITTING A
STATEMENT ON THE AMOUNT OF INCOME AND
TAX PAID, PLACES OF BUSINESS ACTIVITY OF
SUBSIDIARIES AND FOREIGN ESTABLISHMENTS
BELONGING TO A CAPITAL GROUP
As of January 1, 2016, Article 27 paragraph 6 was added to the CIT Act. This provision
imposes on some related domestic entities (e.g. having a foreign establishment or one
or more subsidiaries outside the territory of the Republic of Poland within the meaning of
the Accounting Act) an obligation to submit to the tax office a statement on the amount of
income and tax paid, and places of business activity, subsidiaries and foreign establishments
belonging to the group in the fiscal year (within 12 months of the end of the fiscal year of a
domestic entity for which such statement is submitted).
61
Recent tax / law changes
LIQUIDATION OF THE MANDATORY ADJUSTMENT OF
COSTS
Taxpayers are not obliged to reduce the tax deductible costs by outstanding amounts
classified as such costs, but unpaid at dates specified in regulations. The legislator decided to
remove the provision of.
SUMMARY OF THE MOST IMPORTANT CHANGES IN VAT SINCE 2016
- CHANGES EFFECTIVE FROM 1 JANUARY 2016
INCLUSION OF A NEW RESTRUCTURING PROCEDURE
IN THE PROVISIONS ON THE SO-CALLED BAD DEBT
RELIEF
As of January 1, 2016, the Act of 15 May 2015, the Restructuring Law entered into
force, which introduced a new type of procedure, i.e. a restructuring procedure. This was
accompanied by changes in the provisions governing the bad debt relief consisting of:
1) excluding the application of the bad debt relief in relation to the supply of goods or provision
of services to taxpayers who are not in the course of restructuring proceedings (see, Article
89a paragraph 2 point 1 of the Tax on Goods and Services Act, wording effective from 1
January, 2016),
2) excluding the application of the bad debt relief in relation to the debtors undergoing
restructuring proceedings (see, Article 89a paragraph 2 point 3b. of the Tax on Goods and
Services Act, wording effective from 1 January, 2016).
EXCLUSION OF OBLIGATION OF AN ADJUSTMENT
OF TAX DEDUCED BY DEBTORS UNDERGOING A
RESTRUCTURING PROCEDURE
As of January 1, 2016, adjustments of tax deduced, referred to in Article 89b paragraph 1
of the Tax on Goods and Services Act, do not have to be performed by taxpayers who on the
last day of the month of the expiry of 150 days from the due date of payment are undergoing a
restructuring procedure, introduced by the Restructuring Law (see, Article 89b paragraph 1b
of the Tax on Goods and Services Act, wording effective from 1 January, 2016).
SUMMARY OF THE MOST SIGNIFICANT CHANGES IN PIT
- CHANGES EFFECTIVE FROM 1 JANUARY 2016
Invest in Poland 2016
62
SUMMARY OF THE MOST SIGNIFICANT CHANGES IN THE TAX
ORDINANCE - CHANGES EFFECTIVE FROM 1 JANUARY 2016
INTRODUCTION OF A PRINCIPLE OF RESOLVING
DOUBTS IN FAVOUR OF THE TAXPAYER
As of January 1, 2016, Article 2a was added to the Tax Ordinance, stating that doubts
which cannot be removed as to the content of the tax law are to be resolved in favour of the
taxpayer.
CHANGE OF THE DEFINITION OF DOMESTIC AND
FOREIGN ENTITY
From January 1, 2016, it is specified that domestic entities and related entities within the
meaning of the Tax Ordinance are solely entities associated with other entities within the
meaning of the provisions of the Income Tax Acts (Article 3 paragraphs 11 and 12 of the Tax
Ordinance).
FACILITIES CONCERNING LETTERS SENT BY POSTAL
SERVICES ABROAD
So far only sending a letter via a designated Polish postal operator (i.e. Polish Post) resulted
in recognition of the preservation of the date of delivery of the letter, if such letter was sent
before that date (see, Article 12 § 6 point 2 of the Tax Ordinance). This provision is not
accompanied by any regulations on letters sent by means of postal services outside the Polish
borders.
As of 1 January, 2016, Article 12 § 6 point 2 was given a new wording. It follows from it that
the date shall also be deemed as preserved if before its end, the letter will be sent via a post
office of the operator providing general postal services in another EU Member State, as well
as if the letter sent from a country outside the European Union will be received by a Polish
post ofce of the designated operator (i.e. by the Polish Post).
PUBLISHING IN THE DATABASE OF INTERPRETATIONS
INFORMATION ON THE CHANGE, REVOCATION AND
CONFIRMATION OF THE EXPIRY OF THE INDIVIDUAL
INTERPRETATION
As of 1 January, 2016, information on the change, revocation and confirmation of the expiry
of the individual interpretation is published (see, Article 14i § 4 of the Tax Ordinance), as
well as information on incorrect individual interpretations, which due to death, liquidation
or dissolution of the applicant, for whom such individual interpretation was issued, cannot
be changed, revoked or its expiry date cannot be determined (see, Article 5 § 14i of the Tax
Ordinance added with effect from 1 January, 2016).
CHANGES IN THE AMOUNT OF INTEREST RATE ON
LATE PAYMENTS
As of 1 January, 2016, the rate of interest on late payments was reduced by 50% of the base
rate. It was also specified that this rate applies if the legally effective adjustment of tax return,
together with the justification of the causes of adjustments, will be submitted within 6 months
from the expiry date for submission of the tax return (the condition for payment of arrears
within 7 days will remain unchanged) (see, Article 56a § 1 of the Tax Ordinance).
Moreover, an increased rate of interest on late payments in the amount of 150% of the base
rate was introduced. This rate applies in the case of the most serious errors in settling VAT
and excise duty (see, Article 56b of the Tax Ordinance added with effect from 1 January,
2016).
ALLOWING TAX PAYMENT VIA PAYMENT CARD As of 1 January, 2016, paying taxes using a payment card was made available (see wording
of Article 60 § 1 and 1a as well as Article 60 § 2a-2c of the Tax Ordinance introduced at
the beginning of 2016). The condition is that the tax authority has an appropriate device to
authorise payment transactions (see, Article 60 § 2c of the Tax Ordinance added with effect
from 1 January, 2016). Fees and commissions related to the payment of taxes via payment
card shall be borne by the taxpayer (see, Article 60 § 2a of the Tax Ordinance added with
effect from 1 January, 2016).
63
Recent tax / law changes
If you have any further questions related to
the information within this booklet, please
contact us.
Invest in Poland 2016
64
SUMMARY OF THE MOST SIGNIFICANT CHANGES IN THE TAX
ORDINANCE - CHANGES EFFECTIVE FROM 1 JANUARY 2016, CONT.
CHANGES OF THE TAX PAYMENT DATE IN THE CASE
OF PAYMENTS MADE FROM ABROAD
As of January 1, 2016, the default date of the payment referred to in Article 60 § 1a of the
Tax Ordinance is the date of submission of the payment order by the taxpayer and not - as it
was until now - the day of debiting the account. The remainder of the text of the provision has
not changed (apart from adding to the text of EU regulations the electronic money institution,
which is related to the possibility of paying taxes by payment card).
ALLOWING TAX PAYMENT BY OTHER PERSONS THAN
THE TAXPAYER
As of January 1, 2016, an effective (i.e. effecting in the expiry of the tax liability) tax payment
may also be made by persons other than the taxpayer, i.e. by:
1) the taxpayer’s spouse, their descendants, ascendants, stepchildren, siblings, stepfather
and stepmother - without monetary limits (see, Article 62b § 1 point 1 of the Tax Ordinance
added with effect from 1 January, 2016).
2) other entity - if the tax amount does not exceed PLN 1000 (see, Article 62b § 1 point 3 of
the Tax Ordinance added with effect from 1 January, 2016).
A provision was also added stating that in the above cases, if the content of the proof
of payment is beyond doubt as to the purpose of the payment due by the taxpayer, it is
considered that the payment comes from the taxpayer (see, Article 62b § 2 of the Tax
Ordinance added with effect from 1 January, 2016).
ALLOWING THE DELIVERY OF LETTERS TO P.O. BOXES As of 1 January, 2016, Article 150a of the Tax Ordinance was added. The provisions of this
article allow for the delivery of letters at the request of the party at the post ofce box address
indicated by that party.
CHANGES IN THE PROVISIONS ON THE DELIVERY OF
LETTERS TO LEGAL PERSONS AND ORGANISATIONAL
ENTITIES HAVING NO LEGAL PERSONALITY
As of 1 January, 2016, it is possible to deliver letters addressed to legal persons and
organisational entities having no legal personality:
1) proxies (see, wording of Article 151 § 1 of the Tax Ordinance effective as of 1 January,
2016),
2) administrators or keepers of buildings who undertook the delivery of the letter to the
addressee (see, wording of Article 151 § 2 of the Tax Ordinance effective as of 1 January,
2016).
In addition, as of 1 January, 2016, it is specified that if the address of the registered seat
given by a legal person or organisational entity having no legal personality does not exist or
is inconsistent with the relevant register and one cannot determine the place of business, the
letter is delivered to a natural person authorised to represent the addressee, also when such
representation is cumulative with other persons (see, Article 151a § 1 of the Tax Ordinance,
wording effective from 1 January, 2016). Only if unable to determine the address of the
natural person authorised to represent the addressee, the letter is left in the case file as if
delivered in accordance with Article 151a § 2 of the Tax Ordinance. Wording effective from 1
January, 2016).
65
Recent tax / law changes
ALLOWING FOR THE INDICATION IN THE REQUEST
THAT THE DOCUMENTS CAN BE SUBMITTED IN
ELECTRONIC FORM
As of 1 January, 2016, tax authorities may specify in the requests whether documents can be
submitted in electronic form or on data storages (see, Article 155 § 1 of the Tax Ordinance,
wording effective from 1 January, 2016, and Article 159 § 1 point 4a of the Tax Ordinance
added with effect from 1 January, 2016).
FACILITATING THE AUDIT OF ESTABLISHMENTS OF
FOREIGN ENTITIES
As of 1 January, 2016, a provision was added that if the audited establishment belongs to a
foreign entity, the authorisation to audit will be delivered to and the official identity card will
be presented to the person actually in charge, supervising or representing business activities
carried out in Poland (see, Article 284 § 2a of the Tax Ordinance added with effect from 1
January, 2016). This facilitates the initiation of the audit of establishments of foreign entities.
AUTHORISATION TO REQUEST THE SUBMISSION OF
TAX REGISTERS IN ELECTRONIC FORM
As of 1 July, 2016, Article 193a of the Tax Ordinance will be added, which - in the case of
keeping tax registers using computer programmes - will authorise tax authorities to request
the submission of all or part of these registers and accounting documents by electronic
means of communication or on data storages.
ALLOWING FOR THE REQUEST FROM TAXPAYER’S
CONTRACTORS OF SUBMITTING DATA IN ELEC-
TRONIC FORM
As of 1 July, 2016, Article 274c § 1 point 2 of the Tax Ordinance will be added. It will allow
for tax authorities, in relation to tax proceedings or fiscal audit, to request from taxpayer's
contractors conducting business activities to submit, by means of electronic communication
or data storages, an extract from tax registers and accounting documents stored in electronic
form if the taxpayer’s contractor keeps tax registers using computer programmes.
ALLOWING FOR THE REQUEST FROM TAXPAYER OF
SUB-MITTING DATA IN ELECTRONIC FORM
As of 1 July, 2016, Article 287 § 1 point 3 will be added to the Tax Ordinance. It will allow
for tax authorities to request from the audited entity, its employees and persons cooperating
with the audited entity to submit, by means of electronic communication or data storages, an
extract from tax registers and accounting documents stored in electronic form if the audited
entity keeps tax registers using computer programmes.
SUMMARY OF THE MOST IMPORTANT CHANGES IN THE TAX
ORDINANCE - CHANGES TO BE EFFECTIVE FROM 1 JULY 2016
Invest in Poland 2016
66
getsix
®
PARTNERS
getsix
®
Partners would like to consider this tax
brochure has been and will be of benefit to you
throughout the year. We have tried to encompass
all that you might want to know, and also what we
feel is important, in one handy sized booklet. Of
course we cannot include all tax and legal laws,
but hope we have helped to bring the ‘main’ laws
together for quick and easy reference.
getsix
®
Partners have the philosophy that our
employees are not only the wealth of the business,
but also make getsix
®
different and stronger. We
focus on self-reliance of our staff, without having to
impose their duties. This allows for the free operation
of personal responsibilities and has a positive effect on
efficiency of duties.
It is important to us that we always provide ‘added-
value’ for our clients and potential clients, in this
ever changing world, customer service and support
is very close to our getsix
®
principles.
Our mission is to provide our clients with a full range
of Account, Tax & Financial Services, complimented
with our IT Solutions. This will allow us to deliver
to you the highest level of quality, service and
technical expertise. getsix
®
Partners understands
that its success, is a direct result of your success.
Our team will be committed to servicing your
business beyond your expectations.
Monika Martynkiewicz-Frank Claus Frank
Ortwin-Uwe Jentsch
Roy Heynlein