According to Polish Ministry of Finance (MF), Polish withholding tax (WHT) regime in force from 2019 (but still not applicable based on speciifc regulations issued by MF) will be changed starting from 2021.

MF announced during the meeting with business representatives that based on the draft law that is to be published soon:

1. WHT refund regime based on which WHT should be paid according to domestic rates (19% or 20% as a rule) and then refund application may be filed (to be processed by tax office within 6 months) for the payments exceeding PLN 2M annually for one taxpayer:
   1. should not be applicable for dividends paid to Polish tax residents,
   2. should be limited to the following payments:
      1. passive income (dividends, interest, royalties) – therefore, remuneration for intangible services should not be subject to this regime,
      2. payments to the benefit of related parties;
   3. definition of beneficial owner of the payment will be clarified;
   4. formal ruling confirming applicability of WHT exemption based on EUR directives will be replaced with the ruling on applicability of WHT preferences, therefore it will be possible to apply for a ruling also with respect to applicability of double tax treaties; at the same time, protective period of already issued rulings on applicability of exemption will be prolonged (as a rule it is 36 months);
   5. some simplification will be implemented as regards signing of official statements of Polish company being WHT remitter based on which WHT refund regime may not be applied (as an exception from general rule);
   6. the rules of penal fiscal responsibility with regard to WHT will be mitigated.

Additionally, MF announced that they will finally issue official binding explanatory notes on WHT, addressing i.a. due care required in verification whether the contractor is entitled to benefit from double tax treaty rate or exemption.