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The amendments to Polish tax legislation in recent years should be regarded as a major element of broader systemic changes. From the start of 2021, a number of amendments to tax legislation came into force, most of them concerning income taxes, potentially causing numerous practical problems for taxpayers.

The inclusion of limited partnerships in corporate income tax legislation is regarded as one of the most significant systemic changes in recent years. Under the amended CIT Act, income generated by limited partnerships (previously tax-transparent) is subject to income tax at the level of the partnership. According to the Ministry of Finance, the introduction of these regulations was aimed at “sealing” the tax system in Poland and addressing optimisation structures established by taxpayers.

Among the most widely discussed recent additions are regulations introducing the so-called “Estonian CIT”, i.e. lump-sum taxation of corporate income. The main idea behind Estonian CIT is to defer income tax until the profits from the company are paid out.

Another important change is the new obligation to prepare and publish information on the tax strategy pursued by taxpayers. This obligation applies to the largest taxpayers, i.e. with revenues exceeding the equivalent of EUR 50 million, as well as tax groups of companies. The tax strategy information should contain, among other things, the following elements:

Processes and procedures for fulfilment of tax obligations

  • Fulfilment of tax obligations
  • Related-party transactions
  • Planned or ongoing restructuring operations
  • Applications for tax interpretations
  • Tax settlements in tax havens.

Furthermore, a legal definition of “real estate company” has been introduced into the Polish legal system. It differs significantly from the understanding of this term adopted so far in the legal literature. The definition of this concept is closely related to the introduction of additional obligations for businesses operating in the real estate sector. Among them is the obligation for a real estate company to act as a remitter of tax on the disposal of its shares, rights and obligations, participation units or similar rights. Moreover, real estate companies are required to provide the head of the National Revenue Administration (KAS) with information on entities holding shares in those companies, all rights and obligations, participation units or similar rights, together with the number of rights held by each such entity.

Further major tax amendments introduced from 2022 are part of the so-called “Polish Deal”.

To meet our clients’ expectations, our experienced Corporate Income Tax team within the KPMG Tax Advisory Department in Poland provides comprehensive assistance. The dedicated team consists of professional advisors with many years of experience in CIT advisory support for major Polish and international companies.

The services offered by the CIT team include:

  • General tax advice related to CIT
  • CIT compliance services
  • Tax reviews and due diligence
  • Support for business reorganisation
  • Support for withholding tax
  • Support for drafting and publishing tax strategy information
  • Support in meeting regulatory obligations. 

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