Poland: Recent tax developments relating to company reorganizations
A report that includes summaries of recent tax developments relating to company reorganizations
A report that includes summaries of recent tax developments
The KPMG member firm in Poland prepared a report that includes summaries of recent tax developments relating to company reorganizations.
New clearance opinion on cross-border mergers
A clearance opinion on cross-border mergers through acquisition (case file DKP1.8082.1.2022) was recently published. The case involved the merger of a Polish company with its 100% owned foreign subsidiary. The goal of the merger was to centralize finance functions in a single entity, improve lending and issuing potential, limit the cash flows within the group to the parent entity, and simplify the group structure by reducing the number of entities. The tax authority found that even though the merger resulted in a tax benefit, such benefit was not the primary purpose, or one of the primary purposes, of the merger. Thus, the merger was not treated as artificial or inconsistent with the tax law.
Proposed simplifications in company reorganization processes
A draft bill was recently announced that would implement into Polish law the provisions of two EU directives (Directive (EU) 2019/1151 and Directive (EU) 2019/2121) and the judgment of the Court of Justice of the European Union (CJEU) in case C-106/16. In particular, the bill would:
- Unify the legal framework for cross-border mergers, transformations and divisions (e.g., by extending the scope of exchange of information between registers via system of interconnection of registers)
- Increase the possibilities of transforming Polish companies (e.g., through simplified mergers and a new type of division—division by separation)
- Grant full merger and division capacity to limited joint-stock partnerships
- Simplify company reorganization procedures in order to increase the competitiveness of Polish entities
Read an August 2022 report prepared by the KPMG member firm in Poland
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