KPMG Weekly Tax Review 25 MAR - 02 APR 2024

On 2 April 2024, the bill on whistleblower protection was passed by the Polish Council of Ministers.

Protection under the bill will be granted to individuals in private and public sector, regardless of the grounds and forms of the job or service rendered, who report or disclose information on or justified suspicions of breaches of law. If an employer retaliates against whistleblowers, they will have the right to seek compensation. Moreover, they will not assume any liability, including disciplinary liability or liability for damages relating to the violation of third parties’ rights, in connection with the report. New regulations are to enter into force three months after publication in the Polish Journal of Laws. 

On 27 March 2024, 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 on the Government Legislation Centre’s website. The new regulation prescribes, among other things, the introduction of additional markers (tags) in the JPK_KR structure to identify ledger accounts, and the introduction of modifications in the recording of fixed and intangible assets, as well as differences in costs and revenues for balance sheet and tax purposes. It is to enter into force on 1 January 2025.

On 22 March 2024, a new bill implementing the DAC7 Directive was published on the Government Legislation Centre’s website.

The bill provides for:

• imposing on platform operators the obligation to verify whether the activities facilitated through digital platforms they operate are reportable
• enabling a mechanism for exchange of information between Member States
• improving the existing ways of cooperation between state administrations, inter alia, by introducing the possibility of joint audits.

The reporting duties will consist in collecting information on a seller or sellers entering into transactions via platforms and reporting it to the Head of the National Revenue Administration. 

According to the judgment rendered on 26 March 2024 by the Supreme Administrative Court in case II FSK 832/21, compensation paid under a settlement reached with an employee before the court should be treated as that employee’s taxable revenue under employment relationship, since it is granted to them to compensate for the notional revenue they could have generated if the contract had not been terminated. In fact, the compensation paid shall not be treated as damages for the termination of the employment contract, since a settlement between the parties was reached. The amount paid following the settlement compensates for the benefits the taxable person could have achieved and as such is not subject to exemption under Article 21(1)(3b) of the PIT Act. 

According to the judgment rendered on 26 March 2024 by the Provincial Administrative Court in Białystok in case I SA/Bk 62/24, a taxable person who receives or is granted at their disposal any performances rendered by a family foundation shall enjoy the income tax exemption set forth in Article 21(1)(157)(b) of the PIT Act, but the exemption will apply only to the portion of the taxpayer's income corresponding to the proportion referred to in Article 27(4) of the Family Foundation Act, as of the date the revenue is received. The founder's proportion should be calculated by dividing the value of the in-kind contribution made by the taxable person (numerator of the fraction) by the sum in-kind contribution made by the taxable person and by third parties (denominator of the fraction). This means that any in-kind contribution made by a third party will result in the need to update the proportion in question, and its value for the taxable person will not equal to 100%.

Pursuant to the ruling of the Provincial Administrative Court in Lublin rendered on 27 March 2024 in case I SA/Lu 33/24, a cash payment made into a bank account of the supplier does not satisfy the conditions set forth by Article 22p(1) of the PIT Act.

According to Article 19 of the Entrepreneurs’ Law, payments for goods purchased shall be made via the entrepreneur's bank account, i.e., be transferred from the taxable person’s bank account to the contractor’s bank account. Only then the payment made (under the transaction) can be charged into tax-deductible costs, provided that other conditions set forth by the PIT Act are satisfied. Payment made by depositing cash into a supplier's bank account does not meet the conditions for making a payment through a payment account. In other words, cash payments made to the contractor’s bank account cannot be treated as cashless payments.

According to the judgment rendered on 27 March 2024 by the Provincial Administrative Court in Gdańsk in case I SA/Gd 1102/23, paid establishment of transmission easement by contract falls within the scope of service provision within the meaning of Article 8(1)(2) in conjunction with Article 5(1)(1) of the VAT Act, however, to make it taxable, the entity rendering such services must be a VAT payer in line with Article 15(1)(2) thereof, in terms of that taxable activity. If the property on which transmission easement is established is not used in business activity, it must be assumed that the taxpayer does not act as an entity pursuing business activity with respect to such a transaction.

On 2 April 2024, the Minister of Finance announced the launch of production environment for payment service providers within the frames of CESOP reporting. It enables sending files to systems of the Ministry of Finance in XML format, compatible with the XSD Schema. Businesses can either use a form, a JPK gateway or an application to upload files to the Ministry’s systems. To sign the registration and records form, payment service providers can use a qualified signature or their Trusted Profiles.