KPMG Weekly Tax Review 20 NOV - 27 NOV 2023

On 20 November 2023, a deputies’ bill amending the act on VAT was submitted before the Lower House of the Polish Parliament with the goal of extending the zero percent VAT rate on foods until June 2024. New provisions are expected to enter into force on 1 January 2024.

On 17 November 2023, a draft regulation extending the waiver of tax on the redeemed part of the subsidies granted under the Financial Shields of the Polish Development Fund until the end of 2024 was published on the Government Legislation Centre’s website.

The regulation of the Minister of Finance dated 17 November 2023 on collecting inheritance and donation tax by tax remitters was published in the Polish Journal of Law. The regulation specifies how the inheritance and donation tax should be collected by remitters, including particular activities related to tax collection, the scope of instructions given to taxable persons, the content of tax register, and scope of data included in the declaration on the tax collected and remitted by the remitter. The regulation is to enter into force on 1 January 2024.

The Ministry of Digital Affairs announced via its website that the mandatory use of e-Service is to start later than expected, i.e., on 30 December 2023. The postponement is to take place through amendments to the notice of the Minister of the Digital Affairs published in the Polish Journal of Laws. It is also planned to submit a bill to extend the maximum implementation date to 1 January 2025.

On 21 November 2023, a draft regulation of the Minister of Finance on the template for general power of attorney and the template for notice of changing, revoking or terminating such a power of attorney was published on the Government Legislation Centre’s website.

The amendments proposed include:

• removing redundant fields, namely: “post office”, “fax number”, “electronic address in the tax portal” and the entire section entitled “information on attachments and remarks”;
• amending the forms due to entry into force of new regulations related to electronic service.

New provisions are expected to enter into force on 10 December 2023. 

On 21 November 2023, the Supreme Administrative Court delivered judgment in case II FSK 1184/21 related to an investment fund company, paying its employees remuneration at least 50% of which were investment fund shares, additionally barred in time by adopting appropriate suspension and redemption periods. The company wanted to know when such variable remuneration components should become taxable. The Court noted that in order to become taxable, a performance must bring a measurable benefit to a taxable person and such a benefit must be received by that taxable person. Thus, revenue materializes only upon repurchase (redemption) of units or investment certificates. As a result, there is no need for the company to remit advance personal income tax for the employees upon granting them units or investment certificates, since the granted units or certificates do not bring these employees any value that would lead to revenue generation.

On 21 November 2023, the Voivodship Administrative Court in Warsaw delivered judgment in case III SA/Wa 1840/23 relating to a company owning a fixed asset categorized under group 1 of the Polish Classification of Fixed Assets. The company wanted to know if, in light of Article 15(6) of the CIT Act, in the wording applicable as of 1 January 2022, it can charge depreciation write-downs of the basis of fixed assets into tax-deductible costs, if the on-balance sheet real estate is not a fixed asset subject to depreciation write-downs.

The VAC noted that, pursuant to Article 15(6) of the CIT Act, making depreciation or amortization write-downs on account of wear and tear of fixed assets in accordance with accounting regulations that are recognized in the financial result of the entity for that tax year is treated as a circumstance capping depreciation-write downs made. Consequently, the limit on depreciation write-down introduced by the legislator in such a manner depends on whether the taxable person makes depreciation write-downs recognized in the real estate company’s financial result. Thus, if the company does not make any depreciation-write downs of the real estate possessed in accordance with accounting regulations that would be recognized in the company’s financial result, since it treats the real estate possessed as investment property, limitations set forth in Article 15(6) of the CIT Act find no application.

On 27 November 2023, the regulation of the Minister of Finance on extending the deadlines for submitting transfer pricing information was published in the Polish Journal of Laws.

The regulation signed provides for extending the deadline for submitting TPR forms until 31 January 2024, for reporting periods ending between 30 November 2023 and 31 December 2023. The regulation is to enter into force on the day following its promulgation.

The European Parliament and Council reached a provisional agreement on the regulation on data collection and sharing related to short-term accommodation rental services (STRs). The proposed framework sets out a functional registration system with common rules on establishing registration procedures but is not intended to regulate access to the market for this type of services. According to the proposal “short-term rental” means services consisting in the short-term letting of furnished accommodation, against remuneration, whether on a professional or non-professional basis. However, the regulations will not apply to tourist, regulated activities of accommodation facilities. The reportable data related to STRs include specific address, corresponding registration number, the maximum number of guests that the unit is capable of accommodating and whether the unit is subject to an authorization to offer short term rental accommodation services from the relevant authorities.

On 25 November 2023, the provisions of the regulation of the Minister of Finance dated 23 November 2023 on the waiver of tax on certain financial institutions came into force. Failure to waive the tax would result in a tax obligation arising from 1 January 2024 in respect of a domestic bank, which is a bridge institution, in respect of the tax on certain financial institutions under the Act on the tax on certain financial institutions, which, after reaching a certain value of the taxpayer's assets, resulting from the trial balance, determined as of the last day of the month on the basis of entries in the general ledger accounts, could be transformed into a tax liability.