Due to the spread of the COVID-19 virus, a state of epidemic was declared in Poland on March 20, 2020. As a result of the improved epidemiological situation, this state was lifted on May 16, 2022. From that date, a state of epidemic threat was in effect. It will be lifted on July 1, 2023. This not only means the abolition of the obligation to wear a mask in clinics and hospitals, but will also have consequences for tax law.
Tax scheme reporting
During the state of epidemic and epidemic threat, the obligation to report tax schemes other than cross-border (domestic schemes) has been suspended. Therefore, transactions from the period from March 2020 to June 2023 will need to be reviewed to determine whether they qualify as tax schemes. The deadline for reporting tax schemes will begin 30 days after the state of epidemic threat is lifted. This means that it will remain suspended until the end of July.
Certificate of tax residence
Tax residence certificates that expired during the state of epidemic or epidemic threat, as well as certificates without an expiry date—for which the 12-month period from the date of issue expired during the state of epidemic or epidemic threat, remain valid for up to two months after these states are lifted. Taxpayers may use them if they have obtained a declaration from the taxpayer that the data contained therein has not changed. These certificates will expire at the end of August. To take advantage of the tax preferences related to withholding tax, it will be necessary to obtain a current tax residence certificate from the contractor.
Transfer prices
In the event of a transfer pricing adjustment made at the time of an epidemic or epidemic threat or for the tax year in which such states were in force, the entity making the adjustment is exempt from the obligation to have a statement from a related entity about the adjustment.
Moreover, in order to apply the exemption from the obligation to prepare local transfer pricing documentation for transactions between related domestic entities, the condition of not incurring a loss by the related entity was abolished – in the event that the entity’s turnover decreased by at least 50% compared to the previous year.
The lifting of the state of epidemic threat will result in the obligation to have a declaration from a related entity, and if a related entity suffers a loss, it will be necessary to prepare local transfer pricing documentation.
VAT white list
Until the end of the state of epidemic threat, a longer deadline for reporting to the head of the tax office a payment made to an account not on the so-called white list also applies. This deadline is currently 14 days. After the state of epidemic threat is lifted, a 7-day deadline will apply. Failure to comply with the reporting deadline can have significant consequences. In such a situation, the entity is jointly and severally liable with all its assets, together with the contractor, for the latter's VAT arrears, proportionally attributable to the paid delivery of goods or provision of services.
Tax interpretations
The lifting of the state of epidemic threat will also have consequences for public offices. During its duration, the statutory deadline for issuing individual tax rulings has been extended to six months. As of July 1, the three-month period will be restored.
This article is for informational purposes only and does not constitute legal advice.
