Poland: “Executed tax strategy” reporting requirements

Report must be published on the taxpayer's website by the end of the 12th month following the end of the applicable tax year

Report must be published on the taxpayer's website

Regulations (effective 1 January 2021) require certain taxpayers to prepare and publish a report on an “executed tax strategy.” The reporting requirements may apply for certain transfer pricing purposes.

Requirements

A report on the taxpayer’s tax strategy for a given tax year must be published on the taxpayer's website by the end of the 12th month following the end of the applicable tax year. The requirement to prepare and publish a report on an executed tax strategy:

  • Pertains separately to corporate income taxpayers and tax capital groups
  • Is triggered for a corporate income taxpayer with revenues exceeding the equivalent of €50 million in the tax year for which the report on the tax strategy is due
  • Applies to all tax capital groups, regardless of the amount of revenue 

Scope of information to be disclosed

The information that must be disclosed includes:

  • Taxpayer-implemented processes and procedures for proper performance of tax obligations
  • Taxpayer's performance of tax-related duties in Poland
  • Transactions with related entities (including foreign tax residents) within the meaning of transfer pricing provisions, with a value exceeding 5% of the balance sheet total
  • The taxpayer’s planned or performed restructuring activities that may affect the amount of tax liabilities due from the taxpayer or the taxpayer’s related entities within the meaning of the transfer pricing provisions
  • Submitted applications for advance rulings, binding rate information or binding excise information
  • Information about implemented tax schemes
  • Taxpayer’s tax settlements in countries or territories applying harmful tax competition

The scope of the information also must reflect the character, type, and size of the taxpayer’s business and may extend beyond this list.

Information subject to trade secrets, industrial secrets, professional secrets, and/or manufacturing secrets can be excluded from the tax strategy report. 

KPMG observation

Due to the lack of clear guidance, the first tax year for which a report on the executed tax strategy was to be prepared and published (well as the issue of the deadline for the submission of the report) has been uncertain. According a 2020 statement from the Ministry of Finance, the tax strategy for 2020 was to have been prepared by 31 December 2021.

This year, however, the government discussed a possible postponement until the end of 2022 of the due date of the first report on an implemented tax strategy. Relevant regulations were to be included under the “legal shield mechanism” (containing additional legal solutions to mitigate the negative economic effects of the coronavirus pandemic); however, there has yet to be a published draft of such rules. Furthermore, no provisions on extending the deadline for publishing a report on the tax strategy have been included in the draft amendment to tax laws presented under the “Polish Deal” government program.

The Deputy Minister of Finance on 11 September 2021 confirmed that the obligation to provide information on the tax strategy was to have been implemented already this year. This means that unless there are clear legislative changes enacted in the near future, taxpayers subject to the new reporting requirement must prepare and publish a report on their tax strategy implemented in fiscal year 2020 by 31 December 2021. Information on the address of the website where the report on the tax strategy is to published must be submitted to the head of the competent tax office by the same deadline. Failure to do so may result in penalties.
 

Read a September 2021 report prepared by the KPMG member firm in Poland

 

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