On 25th October 2022 a legal act amending the Corporate Income Tax Act and certain other legal acts providing for further tax changes, mostly concerning corporate income tax (CIT)was published in the Polish Journal of Laws.
I. Changes in the CIT Act
1) Modification and postponement of the entry into force of the minimum income tax regulations
2) Changes in Controlled Foreign Company (CFC) regulations
3) Changes of the tax on so-called shifted profits
4) Changes in the Polish withholding tax regulations
5) Tax deductibility of debt financing costs
6) Changes of the polish holding company (PGK) regulations
7) Changes of the lump-sum tax on company income (so called Estonian CIT)
8) Changes of the rules on documenting transaction with tax havens
9) Removal of 'hidden dividend' regulation
II. Changes in the Tax Ordinance Act
Clarification of the regulations on the obligation to provide information on agreements with non-residents
Coincidence of the obligation to provide information on agreements with non-residents to the head of the tax office competent for the taxpayer and the obligation to submit information on transfer prices (Article 82 §1c of the Tax Ordinance) is clarified. The former will not apply to entities that are obliged to prepare information on transfer prices with regard to transactions with related entities, not constituting so-called transactions with tax havens.
Digitization of information obligations of notaries related to the events raising a tax liability
The amendment changes the procedure for providing information on legal events that may result in a tax liability, included in notarial deeds, which have so far been submitted by notaries to individual tax authorities in the form of paper excerpts. As a result of the introduced changes, the data will be sent to the Head of National Tax Administration by means of electronic communication using the ICT system for counteracting money laundering and terrorist financing, which has already been used by notaries for several years.
III. Other changes
The amendment also provides for other changes including the procedure for refunding tax on income from buildings or the obligation of the Minister of Finance to make available declaration templates. In addition, the act includes provisions extending the anti-inflationary shield from 31th October (stipulated as a deadline by former provisions) until the end of 2022.
The proposed amendment also provides for changes to the Personal Income Tax Act. These changes are, in general, similar to those in the CIT Act concerning the provisions on foreign controlled entities, withholding tax or the documentation obligation with regard to the transactions with tax havens. The situation is similar in the case of amendments to the Lump-sum Tax Act, where the regulations about the obligation of the Minister of Finance to make declaration templates available are modified.
Based on the recently adopted amending act we are facing further major tax changes in a short period of time. Back in June, an amendment to the Polish Deal was adopted, which, among other things, reduced the PIT rate from 17% to 12% for taxpayers. Now, the changes in majority relate to the provisions of the CIT Act. Some of the regulations correspond to the postulates of representatives of business organisations raised in the previous months.
The act was published in the Journal of Laws on 25th October 2022 (item 2180).