Poland: Legislation implementing global minimum tax effective January 1, 2025
The new regulations target groups with annual revenues of €750 million or more.
Legislation implementing Council Directive (EU) 2022/2523 on a global minimum level of taxation for multinational and large-scale domestic groups was published in the Polish Journal of Laws on November 19, 2024. The directive establishes a global minimum tax rate of 15% for multinational enterprise groups, known as the global anti-base erosion model (GloBE) rules or Pillar Two.
The new regulations, effective January 1, 2025, target groups with annual revenues of €750 million or more. They introduce three types of top-up taxes: domestic top-up tax, global top-up tax, and top-up tax on undertaxed profit. These taxes aim to verify that low-taxed entities pay a minimum level of tax, reducing tax avoidance and maintaining tax competitiveness.
Exclusions and safe harbors are provided, allowing certain companies to delay the application of the new rules. For domestic groups, the domestic top-up tax will not be calculated for the first five tax years, starting from the first day of the fiscal year in which the domestic group becomes subject to the top-up tax. Similarly, constituent entities of international groups located in Poland are exempt from calculating the domestic top-up tax and the tax on undertaxed profits for the first five tax years of the group's initial international activity phase, provided they meet specific supplementary requirements.
The transitional country-by-country (CbC) reporting safe harbour can exempt entities from computing top-up taxes under specific conditions.
Administrative obligations require entities to submit information on top-up taxes to the tax office within specified deadlines.
Read a November 2024 report prepared by the KPMG member firm in Poland