As found out, the new tax stamp package, which the Ministry of Finance is working on, is to contain several solutions that would effectively discourage taxpayers from moving businesses and profits to tax havens.

One such solution is to clarify the definition of “place of administration for tax purposes.” Following the example of other European solutions, this will lead to taxation of shell companies in Poland.

As Maciej Oniszczuk, an attorney from Oniszczuk & Associates explains, many entrepreneurs believe that if they move their corporate headquarters to a tax haven, and they still run a company from Poland, Polish taxes will not apply to them. It is not.

See also: Sanacja’s decision in practice. A “colleague fellow” in state treasury companies? “No wolf ticket”

A lot of people are shocked because they think it works like a robot. Meanwhile, if the company is still managed entirely from Poland, then moving the headquarters abroad will not do much – emphasizes Oniszczuk. He adds that such shell companies will be subject to taxes anyway

Poland should consult with others


However, according to Bowie Negman, a tax expert at Admiral Tax, the concept of “place of administration for tax purposes” is already well defined in double taxation treaties. Any change in the regulations in this regard means that each country with which Poland has signed such an agreement must agree to it.

He asserts that taxing corporations is one thing, and taxing board members is another. Corporations have tax domiciles, and natural persons have their own tax domiciles. Polish citizens have an unlimited tax obligation in Poland, which already requires showing or taxing profits from such companies – the tax expert states and adds that there are also regulations on foreign-controlled companies regulating the issue of taxing the profits of these entities.


The Ministry of Finance also announced that it would strengthen the supervision of income transfers to shell companies. Entrepreneurs do this to reduce the tax base in Poland. As the ministry announced, there will be neutralization of such a tax advantage and the obligation to pay tribute.

The point is that some entrepreneurs set up companies abroad (at one point this was especially true in the UK), the sole purpose of which was to bill the cost of related companies in Poland, which resulted in local companies paying much less tax .

In order to avoid undermining foreign costs from subsidiaries, taxpayers created so-called transfer pricing documents – contracts in which they describe capital flows between entities, which means that the tax office usually accepts such invoices. It is mandatory above certain limits for both services and goods.

– Tax offices now have to study more carefully whether invoices from related companies are not “blank” or whether the service has already been performed – warns the lawyer.


The tax office doesn’t like aggressive optimization

not everything. Deputy Finance Minister Jan Sarnovsky announced that Poland will also change regulations on taxation of cross-border mergers. Such operations are becoming more and more common, especially in the case of debtor entities. In some cases, it is easier to transfer the company’s debts abroad and liquidate the company there than to pay off the state’s debts.

See also  The highest level of national debt in the United Kingdom since the 1960s after record borrowing in October - Business Live | Business

The Ministry of Finance announces that if a Polish company is purchased by a foreign entity and its assets are transferred to a foreign company, the Polish businessman will pay the state a special tax “goodbye” – a tax on unrealized profits. (The so-called exit tax, which is 3% or 19%. The 19% rate is applied to assets with a fixed tax value. In contrast, the 3% rate applies to components whose value is difficult to determine).

Such a tax already exists for natural persons who move outside Poland, but it does not apply. – There were cases that tax offices tried to impose on taxpayers who left the country, but the courts categorically ruled that this tax is illegal – confirms Oniszczuk.


In turn, Bauwe Negman asserts that if the Ministry of Finance imposes such a tax in the case of cross-border mergers, it will be a violation of international agreements, because the foreign company that has absorbed the Polish entity will still pay the tax on capital increase in its country.

– It is also a violation of the rules of the European Union, including: freedom of settlement and freedom of movement of capital.

The Ministry of Finance does not want to formally discuss the new regulations yet. “The work on the aforementioned bill is being completed at the Ministry of Finance. Detailed information will be provided after its completion” – representatives of the ministry answered dryly to our questions.