Poland: Refusal to apply preferential withholding tax treatment; R&D conducted by contractor treated as carried out by taxpayer
Summaries of recent decisions of the Supreme Administrative Court
January 8, 2024
The KPMG member firm in Poland prepared a report that includes summaries of the following recent decisions of the Supreme Administrative Court.
- The court on 19 December 2023 upheld (case files II FSK 27/23, II FSK 28/23 and II FSK 29/23) the tax authority’s refusal to issue clearance opinions to apply preferential withholding tax treatment to taxpayers that did not, in the court’s view, sufficiently demonstrate satisfaction of the conditions entitling them to preferences, such as not benefiting from the exemption from income tax on their worldwide income, regardless of the source thereof. Moreover, according to the court, there were reasonable doubts as to whether the taxable persons to whom the payments were made acted as their beneficial owners, and whether one of the main purposes of the transaction was not tax avoidance.
- The court on 14 December 2023 held (case file II FSK 689/22) that research and development (R&D) activities conducted by a team of developers engaged by the taxpayer’s contractor could be treated as R&D activities carried out directly by the taxpayer. The court found that in many cases, the very nature of R&D work requires team cooperation involving several entities.
Read a January 2024 report prepared by the KPMG member firm in Poland