DEBRA – tax deduction on capital

The European Commission presented a proposal of solutions concerning the possibility of deducting the value of the capital increase from the tax base. It is a solution that is to build a “counterbalance” to the currently abused – according to the European Commission – debt financing. The genesis of the proposed solutions goes back to

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Judgment: Operating lease costs are not covered by thin capitalization

The company leased equipment (locomotives) on the basis of leasing contracts, which for tax purposes were operating leasing (balance sheet financial leasing). The company asked whether the locomotive lease payments constitute debt financing costs within the meaning of the thin capitalization provisions (Article 15c of the Polish CIT Act)? In the opinion of the Company,

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Proposed changes to the “Polish Deal”

Today, Prime Minister Mateusz Morawiecki and Deputy Minister of Finance Piotr Soboń presented proposed changes to the “Polish Deal”, which are to meet “the opinions of taxpayers and experts”. The regulations are to come into force in July this year (although there is no bill yet). Below, the proposals for new solutions presented at the

Judgments: retroactive deprecation and non-taxation on liability’s expiration

Today we present you two very important rulings of the Supreme Administrative Court from the past week. Retrospective reduction of depreciation rates The taxpayer (company) had a number of fixed assets. Due to the incurred tax losses, the company considered the possibility of lowering the depreciation rates also for the previous years, taking into account

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Judgment: undocumented costs are tax non-deductible

The taxpayer purchased a number of intangible services (advertising / market research / advisory services), which he classified as tax-deductible costs in CIT. Tax authorities ruled on their exclusion from tax-deductible costs due to the lack of documentation confirming their performance. The decision was appealed against to the District Administrative Court in Gliwice. The taxpayer

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General interpretation – participatory exemption, general partnerships and limited partnerships

The Minister of Finance issued a general interpretation (sign. DD5.8203.2.2021) regarding the application of the so-called “participatory exemption” of income (profits) obtained from participation in the profits of general partnerships and limited partnerships which are CIT taxpayers (pol. spółka komandytowa and Spółka jawna). The Minister stated that this exemption may apply to income (profits) generated

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The “Polish Deal” significantly modified and passed to the Sejm

The Council of Ministers adopted a substantially modified draft amendment to tax regulations under the “Polish Deal” programme. The document has now been submitted to the Sejm. Below we present a synthetic overview of the most important changes in relation to the original proposals. 1. Health insurance contribution The adopted project specifies that the basis

Significant tax reform

The Ministry of Finance has published a comprehensive draft amendment to tax regulations as part of the “Polish Deal” program. A very extensive document (225 pages) includes many changes in various taxes (PIT, CIT, VAT). Below we present a synthetic overview of the most important of them. 1. Principles of tax progression (PIT) As part

No tax on redemption (Financial Shield)

The Minister of Finance signed a decree on redemption of tax on income (revenues) due to redemption of financial subsidies granted from the Financial Shield of the Polish Development Fund. The non-collection of tax will apply to the income (revenue) obtained by the beneficiaries of the support from June 1, 2021 to December 31, 2022.

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Telematics services and withholding tax

Telematics services are becoming more and more popular, especially for companies with a large fleet of vehicles. The vehicles are fitted with devices that enable their tracking (using GPS), downloading data from on-board computers, etc. Such effects are achieved thanks to special software. In practice, as in the case of many other services, suppliers of

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