KPMG Weekly Tax Review 27 NOV - 04 DEC 2023

On 29 November 2023, a draft regulation of the Minister of Finance on additional data to be included in ledgers transferable under the Corporate Income Tax Act was published. Pursuant to the draft regulation, ledgers must be supplemented with, inter alia:

• tax identification number
• full name of the counterparty
• KSeF identifier
• tags identifying accounts
• information confirming acquisition, production or removal of a tangible or intangible asset from the register:
  • the amount, kind and type of difference between the balance sheet result and the tax result
  • the amount and type of taxable income of taxable persons subject to lump-sum tax on corporate income.

New provisions are to enter into force on 1 January 2025.

Moreover, the Ministry announced the launch of consultation on the new templates for JPK_KR logical structure:

• for payers of corporate income tax and
• for payers of personal income tax keeping accounting ledgers.

The consultation process will last until 29 December 2023. Remarks can be sent to: Konsultacje_JPK_KR@mf.gov.pl  

On 1 December 2023, a draft regulation of the Minister of Finance amending the regulation on exemption from the obligation to collect lump-sum corporate income tax was published on the Government Legislation Centre’s website. The regulation is to be amended to extend the period of exemption from the obligation to apply the pay & refund mechanism in withholding tax for payments made through intermediary remitters referred to in Article 26(2c) of the CIT Act and Article 4(4d and 10) of the PIT Act until the end of 2024. New provisions are expected to enter into force on 1 January 2024. 

On 28 November 2023, the Supreme Administrative Court delivered judgment in the case of a company which wanted to confirm that its activities, primarily consisting in sales of specialized equipment for chromatography, spectroscopy, optics, mass spectrometry, bioanalyzer systems, and advance surface analysers can be treated as R&D.

When examining the case, the Court noted that in line with Article 26e(2)(1) of the PIT Act, R&D eligible costs shall be payments arising from the payables referred to in Article 12 thereof (including remuneration payable for holiday and sick leave of employees) and contributions financed by the remitter in connection with those payables, in the part in which the time allocated to research and development activity is included in the general working time (i.e., hours actually worked) of an employee in the given month. Consequently, the activities pursued by the taxable person can be treated as R&D.

On 23 November 2023, the Supreme Administrative Court delivered a judgment in case II FSK 247/22 relating to a taxable person who wanted to know whether in the event of purchasing premises in a building, starting a business, entering the premises in the register of tangible and intangible assets and using them in their business activity, they could subject them to depreciation using an individual rate pursuant to Article 22j(1)(3) of the PIT Act.

The Court noted that one of the categories to which, in line with Article 22j(1)(3)(2) of the PIT Act, individual depreciation rates cannot be applied are other non-residential buildings listed in 109 type of the Polish Classification of Fixed Assets, which only covers hotel buildings. Consequently, since the legislator makes an explicit distinction by referring to a specified type of the Classification, which relates only to hotel buildings, it means that this category exclude premises which are only used for hotel purposes. In fact, they are non-residential premises, but do not constitute a hotel building. Consequently, a tangible asset (i.e., non-residential premises separated out of a hotel property), which is to be purchased and then, subsequently, entered into the register of tangible and intangible assets, will be treated as a 121-type Classification asset. This means that not Article 22j(1)(3)(a) of the PIT Act, but 22j(1)(4) shall apply.

The Anti-Tax Avoidance Council issued a new opinion (resolution 2/2023 dated 18 September 2023). 

The analysed transaction consisted in:

a)       increasing share capital of ABC

b)      covering the increase of the share capital of ABC by an in-kind contribution of, inter alia, shares in Public Limited Company 1 and Public Limited Company 2

c)       Merging Public Limited Company 1 and Public Limited Company 2 through acquisition of Public Limited Company 1 by Public Limited Company 2, resulting in acquisition by ABC of the newly issued shares in the capital of a company formed through the merger

d)      Selling shares in Public Limited Company 2 by ABC to the Investor

e)       Granting a Loan by ABC to the Company

f)       Redeeming shares by the Company.

According to the Anti-Tax Avoidance Council, the described sequence of transactions meets the statutory definition of tax avoidance, since it provided the Taxable Person with a tax benefit in the form of occurrence of loss and non-occurrence of a tax liability, while the application of a general anti-avoidance clause for share swapping (i.e., Article 10(4) of the CIT Act in the wording applicable as of 1 January 2017) was impossible.

On 27 November 2023, two draft regulations giving effect to the authorization provided under Article 106r of the VAT Act, amended in relation to the introduction of the mandatory use of the National e-Invoicing System (KSeF), were published on the Government Legislation Centre’s website.

The draft regulation on using KSeF specifies types of authorizations to use the system, authentication method, the cope of data necessary to access information on invoices, and the methods of marking invoices. In turn, the draft regulation amending the regulation on issuing invoices provides for a raft of technical modifications.

New provisions are expected to enter into force on 01 July 2024.

On 27 November 2023, the regulation of the Minister of Finance of 24 November 2023 on extending the deadlines for submitting transfer pricing information was published in the Polish Journal of Laws. Pursuant to the regulation, the deadline for submitting transfer pricing information (TPR-C and TPR-P) for the taxable years starting after 31 December 2021 - if this deadline expires in the period from 30 November 2023 to 31 December 2023 - is extended until 31 January 2024, meaning that the deadline is one month shorter than initially provided by the previous version of the regulation, put out to public consultation by the Minister of Finance. 

A notice of the Minister of Finance dated 15 November 2023 was published in the Polish Official Gazette. The notice relates to the fixed amount tax rates and the amount up to which performances can be rendered when providing certain services, except for performances for the public, and quarterly lump-sum rates on the income of parish priests and vicars, applicable in 2024.

It sets forth the fixed amount tax rates applicable in 2024, which, in general, increase by ca. 13 percent due to inflation. For instance, current fixed amount tax rates for locksmith services are between PLN 467 and PLN 1,670 (depending of the number of inhabitants of a given locality), while in 2024 they are about to increase to PLN 528 - 1,890. Rates for other types of activities will also be increased proportionally.

Furthermore, the notice also specifies lump-sum rates for the income of parish priests and vicars, which will also increase compared to 2023.