The status of tax residence in Poland is crucial for the correct settlement of personal income tax. Polish tax residents are obliged to settle income tax in Poland on their total income, both domestic and foreign (unlimited tax liability). Polish non-residents for tax purposes, on the other hand, are only subject to taxation in Poland…
A capital company formed by the conversion of a sole proprietorship is considered as a taxpayer starting a business. On March 11, 2025, the Supreme Administrative Court issued a ruling (referenceII FSK 1412/24) that may significantly impact taxpayers arising from the transformation of sole proprietorships into limited liability companies or joint-stock companies. The ruling confirmed…
The Council of the European Union – in a press release dated March 11, 2025 – announced that a political agreement had been reached on the amendment of the directive on administrative cooperation (under the so-called amending directive, referred to as DAC9). The amendment aims to streamline cooperation between national administrations regarding the exchange of…
Both the provisions of the Corporate Income Tax (CIT) Act and the provisions of various double taxation treaties provide for the obligation to withhold tax on payments made to non-residents for the use of so-called “industrial equipment.” In principle, non-residents earning income in Poland from the use or right to use industrial equipment, including means…
What is the tax on income from buildings? The tax on income from buildings has been in effect in Polish law since January 1, 2018. This tax, commonly referred to as the “minimum tax on buildings,” is a solution designed to ensure effective taxation of entities operating in the real estate sector. Who is subject…
What are financial transactions in the context of transfer pricing? Financial transactions encompass a wide range of intercompany activities, including loans, credit facilities, financial guarantees, bond issues, and other financial instruments. These are among the most common categories of related party transactions. To minimize the risk of income adjustments by tax authorities, the terms of…
An increasing number of companies are incorporating ESG (Environmental, Social, and Governance) factors into their business strategies. One of the key challenges in this process is tax risk, which can impact not only financial stability but also reputation and stakeholder relationships. A transparent and regulatory-compliant tax approach is no longer just a legal obligation –…
The tax on shifted income was intended to protect the Polish tax base from transfers income to tax havens. Initially, the regulations covered both domestic and cross-border payments, but after one year of being in force, the scope of the tax was limited to payments to non-residents only. This change has effectively become a time…
For years, financial, service, and distribution or production transactions have consistently been the most commonly reported in the TPR form. This is largely because they are easy to identify as subject to transfer pricing regulations. However, in a complex and rapidly evolving business environment, companies often engage in transactions that do not fit neatly into…
The Head of the National Revenue Administration [KAS] has refused to issue letter of practice regarding incentive programs (ref. DKP16.8082.4.2024 and DKP16.8082.7.2024). This decision raises questions about the tax security of such solutions and potential risks for companies implementing incentive schemes. Which incentive programs were challenged by the Head of KAS? In both cases, the…