News

Real estate tax 2025 – key changes

A significant amendment to the Act on Local Taxes and Fees came into force from 1 January 2025. This amendment aims to clarify the definitions of the key terms – ‘building’ (budynek) and “non-building structure” (budowla) – without having to refer to regulations outside the tax law. In addition, the legislator has clarified the catalogue of objects classified as non-building structures, taking them into account directly in the tax regulations.

The statute of limitations for claims under a contract for a specific work vs. a request for an amicable settlement attempt

A contract for a specific work (Polish: umowa o dzieło) is one of the most common forms of cooperation, particularly in sectors such as construction, art or IT. Under such a contract, one party – the contractor – undertakes to complete a specific work, while the other party – the client – is required to accept it and pay the agreed compensation. It is worth bearing in mind, however, that the rights under a contract for a specific work are not unlimited in time.

Transparent Working Conditions Directive – Major Changes to the Labour Market

The EU Pay Transparency Directive 2023/970 of 10 May 2023 (the “Pay Directive” or the “Equal Pay Directive”) is a landmark solution for the labour market. Although Member States have to implement the provisions by 7 June 2026, many employers are already expressing concerns about the implementation of the new regulations into the Polish legal order. What changes does the directive bring and how will it affect the labour market?

Financial credibility of counterparties – where to look for reliable information?

In the business world, the ability to assess the payment credibility of trading partners is crucial for the financial stability of companies and institutions. Businesses today have access to a number of tools to verify the financial condition of counterparties and their debt history.

Innovation tax credits: New opportunities for businesses

Innovation is one of the key elements in the competitiveness of modern companies. To encourage companies to invest in research, development and cutting-edge technology, legislators have introduced a number of tax breaks. These include tax incentives for research and development (R&D) activities, the prototype relief, the robotisation relief, the expansion relief and the innovative employees relief.

Whistleblowers in an organisation – responsibilities and sanctions

A month has passed since the 25 September entry into force of the Polish Act on the Protection of Persons Who Report Breaches of Law, popularly known as whistleblowers (the “Whistleblower Protection Act”). This is an opportune time to take stock of the obligations involved and the potential consequences for organisations that have not yet implemented proper whistleblower protection procedures.

Successfully implementing AI into your business – what to watch out for

Artificial intelligence (AI) is increasingly influencing global technology trends, forcing businesses to rethink how it can be used in their organisations. As many as 73% of companies believe that the introduction of advanced technologies such as AI will bring tangible benefits to their growth.

Management control in a limited liability company: Risk protection mechanisms and the liability of the management board

Conducting business in a limited liability company (sp. z o.o.) requires appropriate oversight of the actions of the members of the management board. Under the Commercial Companies Code, the management board members have broad powers to conduct business and represent the company.

e-Delivery: A digital communications revolution

The introduction of the electronic form of communications with authorities (“e-Delivery”) into the Polish communications system symbolises a landmark step towards digitalisation. This service, which is the digital equivalent of a registered letter with acknowledgement of receipt, aims to streamline the exchange of correspondence with authorities and provide users with the convenience that traditional solutions often lack. Although it raises some concerns, its potential to improve the efficiency of communication cannot be overestimated.

Principles for resolving linguistic discrepancies in the interpretation of double taxation agreements.

On 28 October 2024, the Supreme Administrative Court issued an important resolution regarding the interpretation of tax legislation in Poland. In the resolution I FPS 1/24, it clarified the principles concerning the resolution of linguistic discrepancies within the framework of double taxation treaties concluded by Poland.

Significant Changes to Laws on Personal Income Tax

In August, the assumptions of a bill that is expected to introduce significant changes to laws on personal income tax, corporate income tax and other laws related to the tax system were published on the website of the Prime Minister’s Office. The changes are aimed at tidying up the legislation, eliminating interpretation doubts and tightening the tax system.

B2B Contracts – The Head of KAS to Prevent The Circumvention of the Law: An Example of Bogus Self-Employment

Today’s labour market is increasingly based on flexible forms of employment, with one popular option among companies being B2B (Business-to-Business) contracts. This type of contract governs the cooperation between two businesses.

Share transfer notice

Changes in the ownership structure of limited liability companies are a common phenomenon. One of the key elements of this process is an existing shareholder giving notice to the company about the transfer of a share (e.g. when selling one or more shares to another entity) under Article 187 of the Commercial Companies Code.

Key to Innovation: Relief for Research and Development Activities

In a world where the only constant is change, Polish companies find that research and development (R&D) relief not only offers an opportunity for innovation, but also significant tax savings.
Government support programmes, such as the research and development (R&D) relief, play an important role in stimulating technological progress and investment in research.

Single-Use Plastics Directive

Against the backdrop of increasing environmental awareness and the need to protect the environment, European and national legislation is stepping up efforts to combat environmental degradation. One of the key pieces of legislation in this area is Directive (EU) 2019/904 of the European Parliament and of the Council of 5 June 2019 on the reduction of the impact of certain plastic products on the environment, commonly known as the “Single-Use Plastics Directive”.

Obligation to cooperate in the performance of the contract – the key to a successful business relationship

In a legal context, cooperation when performing a contract plays an extremely important role in the relationship between the contractual parties. The Polish legal system, based on the provisions of the Civil Code, in particular its Article 354, accentuates the importance of this principle.

Difficulties in Interpretation and Tax Disputes: Transfer Pricing Regulations on Tax Grounds

Under the tax provisions, related parties are required to comply with a number of obligations to ensure that they set ‘arm’s length’ prices in transactions between them, i.e. prices that would be acceptable in a comparable transaction between unrelated parties.

ESG: A New Standard for Companies in an Age of Sustainability

The concept of ESG has become increasingly important for the operation of companies, with investors and consumers having high expectations. But what’s behind the acronym and why should your company pay attention to it?

Compensation for recovery costs: Creditor Support Tools

In recent years, an increasing number of businesses have been considering effective ways of recovering debt collection costs. The Polish legislator has addressed this issue in the Act on Combating Excessive Delays in Commercial Transactions (the “Act on Payment Delays”) to combat unfair practices of counterparties.

Beneficial owner – draft clarifications from Ministry of Finance

Successive amendments to income tax legislation have placed increasing emphasis on the need to verify that the counterparty is the ultimate beneficial owner. However, the legal complexities make complying with this obligation extremely difficult for many businesses. The amendments include a number of key indicators to determine whether an entity is acting as an intermediary.

Whistleblowers in an Organisation – difficulties employers will have to face

Although we still do not have a full final version of the Polish Whistleblower Protection Act, we can already anticipate some of the difficulties employers might face in meeting the requirements imposed by the new legislation.

Responsibilities of a registered proxy

According to the Polish Civil Code and the Commercial Companies Code, a registered proxy (prokurent) is a person who has been given the authority to perform legal acts in the name of and on behalf of another entity, such as a business entity or company, in the conduct of business. The function of a registered proxy is to represent the company and undertake various legal actions.

Small Taxpayers – or Slim VAT 3

On 1 June 2023, the President signed into law the Act Amending the Value Added Tax Act and Certain Other Acts of 26 May 2023. The main objective of the act, known as the “Slim VAT 3”, is to further...

A family foundation may be an interesting solution in the context of succession

Family foundations, which have been available, in theory, since May of this year, are primarily intended to solve succession issues when the death of a business owner meant successors had to go through complicated and lengthy succession proceedings, which in...

Whistleblowers – is it time to implement changes?

Although legislation requiring the implementation of whistleblowing procedures is still pending, there is no need to wait for the changes to be implemented. It is possible that changes will be enacted in the autumn and it is also very likely...

Adoption of resolutions by the management board of a limited liability company

The management board of a limited liability company is, in principle, a collegiate body. Unless the articles of association provide otherwise, each member of the management board has the right and duty to manage the business of the company. “Managing...

Family Foundation

A family foundation is an entity with legal personality with its registered office in Poland. It can only be established by one or more individuals, who establishes the foundation by drawing up a foundation deed or a will and testament...

The National e-Invoice System (KSeF)

The National e-Invoice System (KSeF) is an initiative introduced in Poland that will revolutionise the process of issuing and receiving VAT invoices. The system was launched in January 2022 in an optional form, with its mandatory use expected to start from July 2024.

Information on Employment Conditions

Effective as of 26 April 2023, the amendment to the Labour Code (implementing two directives of the European Parliament and of the Council of 20 June 2019: No 2019/1152 – on transparent and predictable working conditions in the European Union and No 2019/1158 – on the work-life balance for parents and carers) has significantly expanded the scope of information that an employer should provide to employees in connection with concluding an employment contract.

New Entitlements and Change for Parent/Carer Employees

This year’s amendments concerning employment law have introduced a number of new entitlements and changes for employees who are also parents or carers, these include:

remote work;
additional leave;
overtime work;
secondments; and
flexible working.

Criminal, penal, fiscal and tax liability in connection with transfer pricing documentation

As of 1 January 2022, new deadlines apply to comply with transfer pricing obligations for 2022. Liability for failure to comply with transfer pricing documentation obligations arises at two levels, both for the company and for individuals authorised to represent and manage the company’s business, who are most often members of the management board.

New version of the bill introducing obligatory National e-Invoicing System

A new version of the draft act amending the Act on Goods and Services Tax and Certain Other Acts, i.e. the regulations introducing the obligatory National e-Invoice System (“KSeF”), has been published on the website of the Government Legislation Centre (Rządowe Centrum Legislacji). The entry into force of the mandatory regulations has been postponed by six months, i.e. until 1 July 2024.

Summary Dismissal

If an employee who has committed an act of serious misconduct, the employer is often faced with the dilemma of an appropriate response. There are essentially four available courses of action: disciplinary interviews, the imposition of a disciplinary penalty, termination of the employment contract or summary dismissal.

Implementation of the Work-Life Balance Directive – Changes to Employment Contracts

The implementation of the Work-Life Balance Directive entails a number of changes to employee’s rights. Undoubtedly, the plane for which the implementation of the provisions will have the greatest practical importance is employment contracts.

Obligation to report the Ownership Structures of Real Estates Companies in Poland

We would like to remind you that at the beginning of 2022 was introduced the obligation to report the ownership structures of real estate companies to the tax authorities. Who is required to provide information This obligation is subject to...

Changes of the Deadlines of Rrporting of Transfer Prices in Poland

We would like to inform you about changes of the deadlines of reporting of transfer prices in Poland from the beginning of 2023. Deadline for preparation of local transfer price documentation The amendment to the Corporate Income Tax Act changed...

Estonian CIT – an option worth considering

What has come to be known as Estonian CIT – a flat rate on corporate income – is becoming a more and more interesting form of taxation every year. The name for this method of taxation comes from the fact...

Use of the National e-Invoice System – analysis of the proposed regulations

Following consultations, the Ministry of Finance has decided to postpone the effective date of the mandatory use of the National e-Invoice System by six months. Accordingly, the use of the National e-Invoice System (Polish: Krajowy System e-Faktur, KSeF) will become mandatory...

Actio Pauliana

The principle that agreements must be kept (pacta sunt servanda) is not always respected – it often happens that debtors fail to meet their obligations and creditors are forced to pursue their rights in court. However, even the most favourable...

Obligation to correctly identify companies in letters and commercial orders

It is not unknown for entities entered in the National Court Register (KRS) to incorrectly provide their registration details. Sometimes they do not even include such details at all, despite the obligation set out in the Commercial Companies Code and...

Tax on shifted profits

Provisions on shifted profits have been in force since 1 January 2022. They were intended to replace the previous regulations limiting the costs that could be incurred for the benefit of a related party (Article 15e of the CIT Act)....

Remote Work in the Labour Code

One of the most significant labour law changes in 2023 in Poland will be the comprehensive regulation of remote work, which has become extremely popular in the wake of the COVID-19 pandemic. Remote work has become a permanent feature of...

A company’s commercial representative – a few words about a proxy holder

In the course of running a business, it may be necessary to involve a person whose powers are similar to those of a person holding a leading position in the company. A written power of attorney is usually granted for...

Absence from work – how should an employee proceed?

Absences from work fall into two main categories – excused and unexcused (unauthorised). There are many reasons why an employee may be absent from work, including holidays, illness (a L4 sick leave) or donating blood. All these examples relate to...

Hungarian company created for the purpose of a cross-border merger

According to the Hungarian Act CXL of 2007 on Cross-border Mergers of Limited Liability Companies, it is possible to set up a special limited liability company with its registered office in Hungary specifically for the purpose of cross-border mergers. Below...

New deadlines for withholding tax

At the end of August 2022, the Regulation on the Extension of Certain Deadlines Related to Meeting the Obligations Resulting from Withholding Tax came into force. (more…)

Tax clarifications on VAT groups

On 11 October 2022, the Ministry of Finance published the eagerly awaited tax explanations on VAT groups. These explanations (the “MF Clarifications”) relate to regulations on the creation and operation of a new type of taxpayer – a VAT group....

Who cannot be appointed as a member of the management board or a commercial representative of a company?

The amendment to the Code of Commercial Companies that came into force on 13 October 2022, changed the criteria when appointing members of the management board or commercial representatives, among other things. (more…)

Contracts executed by the company with a member of the management board

During the lifetime of a limited liability company, a person holding the position of a member of the management board may wish to enter into a contract with the company. (more…)

Non-Solicitation Clauses

In industries with limited access to employees with the required skills, it is extremely important to properly regulate relations with contractors with regard to the takeover of key employees. This is because, in today's market reality, employee poaching is becoming...

The Sejm amends the CIT Act

On 15 September 2022, the lower chamber of the Polish parliament passed a bill amending the Corporate Income Tax Act (the “CIT Act”). Based on the explanations available on government websites, the amended CIT Act introduces regulations clarifying certain existing...

Amendment to the duties of members of the management board of a Polish limited liability company

On 13 October 2022, an amendment to the provisions of the Polish Code of Commercial Companies (the "CCC") will come into force covering a number of provisions, including new obligations for members of the management board of a limited liability...

Overtime for managers

The Labour Code regulates working hours differently for those employed in a managerial position. Unlike standard employees, employees who manage people on behalf of the employer, as well as managers of separate organisational units are expected to perform work, when...

Supervisions of corporate email

Since employers have the right (and obligation) to ensure the smooth operation of the company, they may also supervise the manner in which their employees perform their duties. Such supervision specifically includes business correspondence exchanged by the employee using a...

Withholding tax in 2022

Under the laws binding in 2022, where the aggregate value of payments made to an affiliated entity exceeds PLN 2 million in any tax year, the tax remitter is required to withhold, on the payment date, a flat rate income...

Polish Deal 2.0 – what is changing?

The Act Amending the Act on Personal Income Tax has been signed by the President and became effective as of 1 July 2022. The Act modifies the amendments introduced by Polish Deal 1.0, reducing the tax complexity to a certain...

Termination of Employment Relationships due to Redundancy or the Elimination of the Position

The economic situation often forces businesses to take measures aimed at cutting costs. With budgets being squeezed, employers might be looking to reduce headcount. However, an employer who has decided to downsize must carry out layoffs in compliance with the...

Sobriety at Work

What can an employer do if an employee reports to work drunk? First of all, the employer must not allow an employee to perform their job while drunk, including an employee who is unfit for work as a result of...

Physical Defects in Real Property

It sometimes happens in conveyancing that the actual area of the land or property differs from the area initially declared by the owner, or even from the area registered in the official documents (the land and mortgage register or the...

Changes in transfer pricing

Since 2022, taxpayers have been dealing with a substantial number of changes in taxes, though these are unfortunately not advantageous in many cases. Nevertheless, among all these new amendments, there are some that can be regarded as positive developments. Such...

VAT Group

Starting from 1 July 2022, a new facility will be introduced to the Polish VAT system, i.e. VAT grouping. This mechanism will streamline VAT settlements and reduce administrative burdens between related parties from different industries. In many cases, VAT groups...

Posting an employee to Poland

The important issue is to know that labour mobility is an element of one of the fundamental freedoms protected by EU law – the freedom to provide services. The principle of the freedom to provide services entitles economic operators to provide their services in another EU Member State without having to become registered or established there.

New obligation to hold a cryptocurrency licence

Cryptocurrencies have been arousing huge interest among enthusiasts of new technologies and finance and among laypeople for a few years now. There are at least several reasons why the cryptocurrency business is blossoming. (more…)

R&D Tax relief

Nowy Ład – the “Polish Deal”, which the Polish President signed on 16 November, introduces a range of novelties for taxation, including withholding tax. The new law will enter into force on 1 January 2022

Minimum corporate income tax

Whistleblowing – the history of the Whistleblower Directive

Does every shareholder have the right to inspect the company’s accounts and documents?

The Work-life Balance Directive

Limited joint-stock partnerships

Polish Deal – undeclared work

Whistleblower Act

POLSKI ŁAD AND CHANGES TO WHT

ACT ON THE ELECTRONIC DELIVERY OF DOCUMENTS

The Act on the Electronic Delivery of Documents, which entered into force on 5 October 2021, is aimed at modernising, streamlining and standardising communication with the public authorities. At the moment, users need to have a number of accounts on various official sites in order to use the electronic services provided by public offices. Raising complaints about a lack of user friendliness, clunkiness and chaos in the systems, businesses have tended to give up on using remote means of communication with authorities.

Newsletter No. 5/2021

1. The scope and application of a commercial representation A commercial representation (prokura) is most frequently associated with companies, despite being regulated by the Civil Code, and not the Commercial Companies Code. A commercial representative (prokurent) may be appointed by...

When performing a contract or settling contractual claims, the parties often modify the original payment dates. This practice is admissible based on the principle of freedom of contract, and so does not raise any controversies. It also happens (most often...

How to dismiss an employee? - Ecovis in Poland

From December 2020, businesses may once again use Covid-19-related aid under the “Shield 6.0”. This time the regulations apply to a broader group of businesses and the support includes: Subsidies to salaries A one-off additional “parking benefit” Additional “parking benefits”...

Newsletter No. 06/2020

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