Tax Newsletter - 30 April 2018

Periodical newsletter on tax matters.

In current issue:

  • What is new and what is plans in the tax regulations: The Constitution of Business
    On 30 April 2018, the so-called Constitution of Business enters into force (with the reservation of a small number of provisions entering into force at later dates). The Constitution of Business is a packet of five Acts, newly regulating the domestic trade market, which key Act is the one dated 6 March 2018 - the Traders’ Act.
  • Court decisions in tax-related cases:
    • In decision no. II FSK 23/16 dated 23 January 2018, the Supreme Administrative Court found that any expenses incurred in connection with insurance purchased in order to secure the sources of upkeep of a taxpayer in the situation where this taxpayer has been deprived of gaining income, has not been incurred in order to obtain revenues from business activity. According to said Court, the expense incurred in connection with this insurance was of a personal nature and served the personal needs of a taxpayer and, consequently, cannot be regarded as a business activity revenue generating cost.
    • By way of the decision dated 29 November 2017, ref. no. III SA/Wa 3577/16, the Provincial Administrative Court in Warsaw settled the dispute in respect of the determination as to whether the value of specific benefits for an employee (accommodation, cost of travel, medical insurance and assistance, accident and third party civil liability insurance, costs of a visa and other immigration documents) financed by an employer would constitute for the employee revenue under a work relationship in the meaning of the PIT Act if incurring these expenses is directly linked to the discharge of this employee’s work-related duties.
    • In its decision dated 18 December 2017, file no. I SA/Wr 936/17, the Provincial Administrative Court in Wrocław analysed the problem as to whether, within the framework of replacement performance executed by a general contractor, the relevant activities are taxed between the general contractor, and the subcontractor. In other words, whether a general contractor renders a service to a subcontractor.
  • Clarifications from the Tax Authorities: 
    • The object of the interpretation of the Director of State Tax Information dated 9 March 2018, file no. 0111-KDIB1-2.4010.442.2017.1.MM was the issue of whether the cash transferred by an applicant to an affiliate on account of a bonus due under the contracts concluded were excluded from being treated as revenue generating costs by virtue of Art. 15e Sec. 1 of the Personal Income Tax Act (“PIT Act”), added to the Act in force as of 1 January 2018.
    • In its interpretation dated 2 March 2018, file no. 0114-KDIP2-2.4010.15.2018.1.AZ, the Head of State Tax Information presented its position on the questions relating to the obligation to prepare tax documentation as referred to in Art. 9a of the CIT Act, including the obligation to prepare an analysis of comparative data.
    • In its general interpretation dated 2 March 2018, no. DD6.8201.1.2018, the Minister of Finance confirmed that the provision of a cash contribution to a company or a cooperative, does not generate revenue on the part of the contributing entity.
    • In the interpretation dated 7 February 2017, file no. 0115-KDIT3.4011.427.2017.1.WR, the Head of State Tax Information confirmed, as correct, the applicant's position on the admissibility of taxing, with the 19% linear tax, of the income on rendering advisory services provided within the framework of conducted business activity.
Read the full newsletter here: Tax Alert - 30 April 2018

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