NEWS & Events
We are pleased to inform that TRA website is now online: http://www.tax-representative-alliance.org/
Please visit to find out how together with the other TRA members Intertax can provide VAT advisory services and cross-border VAT representation.
On the website some important VAT overview info is included together with VAT services that can be provided for our clients. The TRA can coordinate the VAT registration of a company in several European countries and then later the monthly or quarterly compliance. The client has the advantage that they can have only one point of contact with us, if preferred, and then we handle their VAT affairs in the other European countries with our TRA colleagues.
The Ministry of Finance prepared May 8th 2013 the project of changes regarding CIT and PIT Acts introducing taxation in Poland on income of foreign companies – the so called Controlled Foreign Corporations. Income from financial and non-financial business activity of given foreign company would be taxed wit 19% tax rate in the case if at least half of their income were passive income.
The planned change will affect foreign companies from countries with lower of at least 25% PIT and CIT rate, compared to Poland, or where foreign earnings are not taxed at all. The planned changes are due to the EU Directive on the common consolidated corporate tax base. In support of this project, the Ministry of Finance exclude the need for changes to international agreements on avoiding the double taxation. The Ministry of Finance is planning to enter into force the above change starting from January 1, 2014.
On April 23rd 2013, a new “tax havens” list was announced in Poland. It comes into effect 14 days after its announcement. The Minister of Finance signed the two decrees: one that determines the countries and territories engaged in a harmful tax competition in regards to the corporate income tax, and the other in regards to the personal income tax.
The new “tax havens” list currently consists of 37 listings. The following dependencies of the British Crown were removed from the list:
Isle of Man
Poland ranked 27th in the ranking of the most globalized economies in the world, ahead of Italy, South Korea and Japan. As the report shows Poland is the most open for trade.
Globalization Index measures the relationship of the 60 largest economies in the world (in terms of GDP), with other countries, taking into account the criteria such as the openness to trade, the capital flows, the labor mobility, the exchange of the technology and knowledge and the cultural integration.
The study was prepared based on the interviews with 750 managers of global companies. The report shows that despite the low GDP growth observed in 2012 and the uncertain economic outlook, globalization continues to proceed. First of all, thanks to the technological development, and cross-border movement of knowledge.
The report also draws attention to the fact that more globalized are medium-sized markets with high growth rate, such as Vietnam, Malaysia, Thailand and the Philippines, as well as smaller European countries: Belgium, Slovakia and Hungary. The BRIC countries were on much further positions: Brazil on the 45th place, Russia on 48th, India at 54th and China at the 44th. On the top of the ranking were Hong Kong, Singapore and Ireland.
Poland was on the 27th place.
The changing nature of business, technology development and investment opportunities in the markets will encourage rapid growth of globalization.
Challenge for Poland as a friendly to business country, will be the increase of the competitiveness of the investment compared to other countries of Central and Eastern Europe.
Unlimited duration of special economic zones operation certainly will help to increase the inflow of foreign direct investment into Poland.
Broadening the directions of expansion and export structure will allow Poland to even greater strengthening of Poland’s position on international markets the experts stated. The report shows that in category: openness to trade Poland ranks best.
Intertax is a member of the British Polish Chamber of Commerce.
British Polish Chamber of Commerce reaches out across Poland and the UK promoting the best of each country. The BPCC currently operates a regional hub network in Poland and the UK. BPCC actively works with the UKTI, the British Council, the Prince’s Youth Business Poland. The BPCC engages with high-profile partners such as the chambers network in the UK, the CBI and IoD, Federation of Small Businesses, UKTI, British Embassy in Warsaw and Polish Embassy in London as well as many Polish business organisations and government bodies.
For additional information please visit: http://www.bpcc.org.pl/ and also http://www.bpcc.org.pl/en/article/our-international-colleagues-tra%5b2008427%5d.html
Polish Ministry of Economy proposes a new tax break for most innovative companies. If the proposal passes as early as next year expenses incurred on research and development will be tax-deductible. The proposal of a new tax relief assumes that the company running the research and development can benefit from tax preferences (in filling PIT or CIT).
Ministry of Economy wants the a relief to be in force from the beginning of 2014. It is part of the Enterprise Development Programme until 2020, which is a part of the new European Union budget. With the new tax relief he innovativeness of Polish companies will increase, the experts stated. The project is currently at the stage of inter-ministerial consultations. Today, the companies that choose to invest in research to improve the quality of their products may include expenses incurred as tax deductible costs, but they cannot take advantage of tax relief for the creation of innovative products.
The Ministry of Finances prepared project of four draft regulations, containing the new VAT return forms. The new forms shall be effective to use starting from 01.04.2013. The new regulations have been prepared in relation with the VAT Act amendments (Law Journal 2013, position 35).
In the VAT return forms: VAT-7, VAT-7K, VAT-7D, VAT-8 and VAT-9M the changes of a technical nature were introduced. The forms in use right now can be used no longer than for the last period of 2013, except for the tax periods where the taxpayer makes a correction of a tax base and the amount of the tax due on the basis of an Article 89a of the VAT Act or makes an increase of the input tax on the basis of an Article 89b paragraph 4 of the VAT Act.
Starting from 01.04.2013 taxpayers who do not have fixed establishment on the territory of Poland, will have the possibility to establish a tax representative in Poland, without having to register as an active VAT payer.
The new VAT return forms also prepared by the Ministry of Finances are: VAT-10, VAT-11, VAT-12.
Government Pension Fund Global, known as GPFG, since the early 90s is investing the surplus from the country’s oil exports on the polish market, which shows the stability of our country.
Currently GPFG assets reach 3.8 billion NOK, or about 2.1 billion PLN. According to the SWF Institute, this makes GPFG the largest investor of its type in the world. A growing portion of its capital this fund invests in Poland. At the end of 2012, the Norwegian pension fund has shares in 50 companies of the Polish Stock Exchange. A year earlier, the fund had shares of 48 Polish companies, and in 2010 of 41 companies. In 2007 the GPFG did not invest in Poland yet. The value of shares of the Polish companies GPFG had at the end of 2012 reached 6.9 billion NOK (3.9 billion PLN counting the average exchange rate of the NOK in 2012) and it is 17.4 percent more than a year earlier.
The experts stated that from the GPFG point of view, the shares of polish companies are very attractive, because the companies operate in a distinctive stability of the macroeconomic environment, and are relatively low-priced. They do not have the growth potential such as Turkish companies, but are much less risky and this convinces Norwegians. GPFG must take care not only about profits, but also about the safety of investments, and from the Norwegian perspective Poland is safer than many other developing countries. Therefore, Poland is an attractive market.
Interest on the part of the Norwegian pension fund is a strong signal to investors and other economies that Poland is still a very attractive investment market. Despite a weak first quarter, Poland will have a chance to rebound relatively quickly, because our main trading partner – Germany, is rebounding currently.
Additionally our national economy considering European conditions is a large and absorptive market driven by a domestic demand. Poland is still perceived as a dynamic economy, where entrepreneurs are flexible and can easily adapt to new economic conditions. Also it should be remembered that after 2014, Poland will receive a further financial support from the European Union, which naturally will lead to increased investment in the energy sector and infrastructure, and such companies are a major percentage of all companies that make up the WIG20 (Warsaw Stock Exchange).
Currently Polish people can buy more goods than Portuguese – for the minimum wage.
In January the minimal wage in Poland has increased to 376,58 EUR gross per month. This is the highest in Eastern European countries, but still much less than it is in Western Europe. The lowest minimum wage there is in Romania (157 EUR), and the highest in Luxembourg – 1 874 EUR per month. Eurostat includes us in the group of countries with the lowest minimum wage. The situation is quite different, however, if we take into account the purchasing power parity of wages. In this comparison we belong to the middle-income countries. What’s more, in 2013, for the first time Poland was ahead of the country of the “old” EU – Portugal. The fact that a Pole for minimum wage can buy more goods and services than the Portuguese, it is a good news for the public. After all Portugal is a country wealthier than Poland. According department of labor research, the minimum wage is shaping at 40 percent of the average earnings. In less wealthier areas, such as Eastern Poland, the minimum wage can have a much higher purchasing power than in Warsaw. It is estimated that the minimum wage in Poland receives about 3 percent of employees.
On February 13th 2013 in Warsaw, Undersecretary of State in the Ministry of Finance Maciej Grabowski and U.S. Ambassador in Poland Stephen Mull signed the “Convention between the Republic of Poland and the United States for the avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income”. The Convention will replace the agreement between the Government of the Polish People’s Republic and the Government of the United States of America for the avoidance of double taxation signed in Washington on October 8th 1974.
It seems that the ratification of the Convention shall not be earlier than the end of 2013. This would mean that it will apply to income earned in 2014 at the earliest.
The most important changes relate to the following issues:
1. The rules of determining the Fiscal Residence
2. Changes in the definition of permanent establishment
3. Income from real property
4. Business Profits
5. Shipping and Air Transport
9. Capital Gains
10. Wage labor
11. Artists and Athletes
12. Pensions and similar benefits
13. Income from holding Governmental Functions
14. Students and Trainees
15. Methods of Relief from Double Taxation
It should be noted that the new agreement contains certain provisions that are now standard in the Polish agreements on the avoidance of double taxation, but which have not yet been included in an agreement with the United States. For example, regulations on the taxation of the remuneration of the directors (typically claimed as tax at source, in the country of the residence of the given company). It is worth mentioning that the new agreement made very comprehensive regulations “limit contractual benefits” (Article 22 of the new Agreement). They are mainly to prevent the phenomenon of so-called treaty shopping. The new agreement also contains a full exchange clause of information consistent with the OECD standards.