It is 19 April 2022. We invite you to the next episode of the “Weekly Tax Review” prepared in cooperation with tax experts in KPMG in Poland.

Closure of public consultations regarding Amendments to the Polish Deal package

On 13 April 2022, the latest revision of the draft bill amending the act on personal income tax and certain other acts bringing changes to the Polish Deal package was published.

The proposed changes primarily originate from extensive public consultations.

A raft of new solution has been added to the previous proposals. Most importantly, entrepreneurs who have opted for flat taxation (after the end of the tax year 2022) or lump-sum taxation (after the end of the tax year or until 22 August 2022 - for the second half of the year) can switch to taxation according to the tax scale. Furthermore, under the bill, the deadline for all annual PIT settlements is to be set for 30 April.

The essential provisions of the bill are to enter into force on 1 July 2022. 

Decrees on real estate company reporting

On 12 April 2022, a decree on transmitting information on real estate companies in the context of corporate income tax was published, followed by a similar decree for personal income tax, issued a day later.

Pursuant to the decrees, information on real estate companies, authenticated with a qualified electronic signature, should be transmitted via interface software available on a website indicated in the Public Information Bulletin that can be accessed on the websites of the office supporting the minister responsible for public finances. The fact of submitting information on real estate companies is confirmed by an Official Receipt Certificate. The decrees entered into force next day after they were announced.

New draft bill on whistleblowers

On 12 April 2022, the latest revision of the draft bill on protecting individuals reporting breaches of law was published.

Compared to the previous version, the project includes several changes. For example, it extends the list of protected individuals to apprentices, temporary workers, service officers, and professional soldiers. Furthermore, it expands the list of prohibited acts of retaliation and clarifies what “oral report” should mean in this context.

Importantly, the new version of the bill introduces a vacatio legis of 2 months (instead 14 days) and points out that private entities employing 50-249 workers would be required to establish an internal reporting and follow-up procedures by 17 December 2023. In turn, private entities employing 250 workers and more, as well as public entities, public authorities and the Ombudsman are required to fulfil this obligation within one month from the entry into force of the act.

Planned amendments to the Polish Tax Code

The first reading of the draft bill amending certain acts to automate the handling of selected matters by the National Revenue Administration took place at the Lower House of the Polish Parliament. One of the key amendments consists in extending the list of authorities with which the Head of the National Revenue Administration (NRA) can share information collected in the Central Register of Tax Data with the public prosecution service, the police, and the Head of the Polish Financial Supervision Authority. Furthermore, NRA bodies are to become authorized to deliver correspondence to the taxpayer's account in the e-Tax Office and thus reply to the submitted requests, provided that the taxpayer agrees to this form of communication. This means, for example, that tax clearance certificate can be issued automatically, following the taxpayer’s application online. As per the applicable rules, the new regulations are to enter into force 14 days after their publication in the Polish Journal of Laws.

SAC’s ruling: prerequisites for applying tax-deductible costs by creators-employees

In its ruling dated 2 April 2022 (case file II FSK 1557/19), the Supreme Administrative Court held that Article 22(9)(3) of the PIT Act, relating to the application of increased 50% tax-deductible costs, does not set forth a prerequisite of adequacy of the remuneration for the work to the value thereof. Consequently, to apply increased tax-deductible costs there is no need to align the remuneration for the work with its value.

Importantly, the Court stated that whether the activities pursued by the company’s employees remain within the scope of the tax law provisions can be determined by way of an individual tax ruling. 

General ruling on expenses incurred to repay a loan held on a property disposed or a property right

On 1 April 2022, the Minister of Finance issued a general ruling no. DD2.8202.5.2020 on classifying expenses incurred to repay a loan held on a property disposed or a property right as costs incurred for own housing purposes, under Article 21(25) of the PIT Act, in line with the laws in force in Poland until 31 December 2021.

The Minister pointed to the fact that this issue has been long subject of divergent legal interpretations. Ultimately, the Minister of Finance came to the conclusion that for the purposes of personal income tax, in line with the laws in force in Poland until 31 December 2021, it should be considered that the expenditure on repayment of a loan, including consolidation and refinancing loans, and the interest on this loan taken to finance the expenses related to the real estate which is the subject of sale for consideration, falls within the concept of expenses for own housing purposes.

Costs of financing lease in VAT

In its ruling of 7 April 2022 (case file I FSK 2384/18), the Supreme Administrative Court agreed that not every auxiliary service related to financing lease translates into receivables directly associated with a supply against consideration. The Court expressed the view that to include the value of auxiliary services in the taxable base for financing lease, it is necessary that this amount be known at the time of determining the taxable base, which, however, is impossible to a significant extent in the discussed circumstances.


Read the next episodes of the “Weekly Tax Review”, where, until 2 May 2022, we will explore the key aspects of the 2022 PIT return season.