Changes in corporate income tax (CIT)
Obligation to prepare and publish information on the execution of tax strategy
On January 1, 2021 an obligation to prepare and publish information on the execution of tax strategy entered into force.
The obligation will apply to taxpayers whose revenues exceeded EUR 50 million in a tax year and tax capital groups.
Taxpayers shall prepare and disclose information on, inter alia:
- approach to processes and procedures on managing obligations arising from tax regulations and ensuring their proper execution,
- the number of submitted reports on tax schemes (MDR), separately for each tax,
- transactions with related entities, the value of which exceeds 5% of the assets balance sheet total (based on the Statutory Financial Statements),
The bill does not indicate which fiscal year is the first to be reported. However the Ministry of Finance explained that taxpayers are required to prepare and publish information already for the year 2020, by 31 December 2021.
Taxation of limited partnerships
The provisions will apply from May 1, 2021, however, the taxpayer may decide whether to become CIT taxpayers between January 1 and May 1, 2021.
The basic income tax rate will be 19% on the income earned. If the limited partnership can be recognized as a small taxpayer, the rate will be 9%.
Taxation of some general partnerships
CIT is to be imposed on those general partnerships in the case of which income taxpayers participating in the profits of such general partnerships will not be disclosed.
The changes to the regulations included in the amendment stipulate that the income of partners of limited partnerships will be classified as income from participation in the profits of legal persons (similarly to dividends) and thus taxed according to the PIT rate of 19%.
Optional tax rules, so called "Estonian CIT"
The new optional tax rules in CIT are effective as of January 1, 2021.
The law is addressed to capital companies that meet the following criteria:
- revenues do not exceed PLN 100 million gross,
- the shareholders are exclusively natural persons,
- have no shares in other entities,
- company employs, apart from the shareholders, at least 3 employees on the basis of an employment contract (or incur monthly salary expenditures in the amount of at least three times the average monthly salary),
- passive income does not exceed operating income,
- demonstrate an appropriate level of capital expenditures.
There is no tax payment until the profit is retained in the business. The tax will be paid when the profit is paid out.
Changes in value-added tax (VAT)
New matrix of VAT rates and binding VAT rate information
As of 1 July 2020, a new matrix of VAT rates entered into force. The amendment to the VAT Act introduces new lists of goods and services, subject to reduced VAT rates. The new list is based on the Combined Nomenclature (CN) for goods and the current PKWiU (Polish Classification of Goods and Services) for services.
The amendment also implemented regulations on binding rate information (BRI). The BRI is a decision issued by the tax authorities for the purposes of VAT on supplies, imports, intra-Community acquisitions of goods or services. BRI contains a description of the goods or services that it relates to, classification of the goods according to CN or the services according to PKWiU, and the VAT rate applicable to the goods or services so classified.
Extended VAT SAF-T file (VDEK / V7M)
From October 1, 2020, entrepreneurs are required to submit VAT SAF-T files in the new, extended version (V7M, VDEK).
With the introduction of VDEK, the obligation to submit VAT returns in their previous form are abolished. At the same time, it means that the VDEK SAF-T file also include information from the VAT return. This is a significant change in the architecture of the xml file compared to the current VAT SAF-T scheme.
As of January 2021 amendment to VAT Act entered into force which among other aims to eliminate the obligation to collect confirmations of receipt of correcting invoices and wait for their delivery. The new law contains changes in relation to the correcting invoices in plus:
- if the correction is caused by reasons arising at the time the original invoice was issued, it should be settled in the tax return for the period in which the original invoice was shown;
- if the correction is caused by reasons arising after the transaction, the correction should be made in the tax return for the month in which the correcting invoice was issued. Such a case will take place when the amount of the tax due was shown in the original invoice in the correct amount, but the reason for the correction occurred later;
- the subsequent detection of an error in the original invoice is the reason for increasing the tax base settled in the tax return for the period in which the original invoice was shown.
On 1 September 2016, the Retail Tax Act of 6 July 2016 entered into force, but was quickly suspended for 2016 and 2017 due to European Commission (EC) investigation into the Polish tax on the retail sector. After several postponements, this law came into force on 1 January 2021.
Based on the Retail Tax Act, retailers are to be taxed on the revenues achieved on retail sales, which should be understood as sales of goods to consumers for remuneration, in case an agreement is concluded on the business premises or away from business premises of the given taxpayer. Thus, e-commerce sales should not be subject to this tax. In this context, the services associated with retail sales should also be subject to taxation, unless they are recorded separately than the sale of goods.
On January 1, 2021, the capacity fee charged for electricity entered into force. The law introducing the fee was passed by the Parliament in 2017.
It will be a new item on the bills for electricity consumed by each consumer.
The capacity fee will be collected, inter alia, from end users connected directly to the transmission network and electricity distribution system operators.
The President of the Energy Regulatory Office indicated that the capacity fee will be charged for each consumed MWh in the period from Monday to Friday (excluding public holidays) from 7:00 to 22:00. Its amount will depend on the degree of consumption and will amount to PLN 76.2 per each consumed MWh (PLN 0.0762 / kWh).
Sugar tax and fee on alcoholic beverages
The fee on foodstuffs, the so-called "sugar tax", was imposed on beverages with added sugars, sweeteners, and caffeine or taurine. The amount of the sugar tax is:
- PLN 0.50 for the content of sugars in an amount equal to or less than 5 g in 100 ml of drink, or for the content of at least one sweetener in any amount,
- PLN 0.05 for each gram of sugar above 5 g in 100 ml of drink.
Drinks containing the addition of caffeine or taurine will be charged a fee of PLN 0.10 per liter of drink. This fee will be paid, among others by entities supplying retail stores. The fee for the permit for domestic wholesale trade in alcoholic beverages with alcohol content above and below 18% will be imposed on alcoholic beverages in unit packages with a nominal quantity of the drink not exceeding 300 ml.