Intertax – six year long dispute with the Polish Tax Authorities

Intertax, after winning a six year long dispute with the Polish Tax Authorities, has been authorised with an official ruling regarding the responsibilities of foreign companies in relation to hiring employees in Poland.

The Administrative Court decided that the attitude of the Polish Tax Authorities was wrong and the foreign entity hiring employees in Poland should be treated as an employer in accordance with arts.31 and 38 of the Natural Person’s Income Tax Act.

This means that the employer is obliged to calculate, collect and pay the income tax contributions from the employees’ salaries.

Prior to this ruling, the Polish Tax Authorities incorrectly stated that this obligation should be fulfilled by the employee.

The resolution of this dispute, in concordance with Intertax’s original stance, will have a huge practical impact on employees hired in Poland by foreign entities. They are no longer obliged to perform onerous tax obligations requiring a wide knowledge of tax rules connected with income tax contributions.