Agnieszka Szczotkowska

Tax adviser (Poland)
Phone: +48 616 24 49 22

By virtue of a resolution of 27 June 2019 the Minister of Finance postponed the application of some of the new withholding tax rules. According to that regulation the new rules will come into force on 1 January 2020.

This means that the 2-million threshold on payments made to the same taxable person does not apply. Consequently, the management of the withholding agent who enjoys the tax exemption or the preferential rate under a tax treaty does not need to submit an additional statement that he is entitled to apply the exemption or the preferential rate. Neither do they need an opinion on the availability of the exemption.

There is one more important piece of information for taxpayers: only the new mechanism of deducting the withholding tax has been postponed. A withholding agent who makes a payment subject to withholding tax is still obliged to exercise due care (or extra due care in the case of associated enterprises) in checking the eligibility for the exemption or the preferential rate. The agent must also classify the payee as a beneficial owner pursuant to the new amended (i.e. extended) definition.

Withholding agents have gained more time to get ready for the new regulations, that is, to develop a due care procedure, apply for a decision on availability of the exemption or audit transactions liable to withholding tax.

Although we find the postponement of the new withholding tax rules to be good, we cannot now talk about any certainty of tax laws. Lawmakers have kept taking businesses by surprise recently with sloppy, spontaneously postponed regulatory amendments.

If you have any additional questions about CIT, Rödl & Partner experts in Gdansk, Gliwice, Cracow, PoznanWarsaw and Wroclaw will answer them.

Agnieszka Szczotkowska