During a conference organized by „Dziennik Gazeta Prawna” the taxation and accounting implications of group settlements were discussed. Employers of Poland were represented by Przemysław Szabat and Agata Czerniak.
The discussion was dominated by amendments to the tax law which will come into force in two months’ time. The most important and most broadly commented change concerns the taxation of controlled foreign corporations (CFC).
Agata Czerniak of the Tax Committee of Employers of Poland drew attention a.o. to the fact that new regulations will apply not only to companies operating in tax paradises, but also companies which gain passive profit in countries with a relatively low tax rate. This poses a question of whether such regulations are In compliance with agreements on avoiding double taxation, signed by Poland and other countries
– The aim of the new regulations is to tax income in one country only – she stressed. She also reminded that the objective of the OECD Model Tax Convention, which Is a model for bilateral agreements is not only to eliminate double taxation, but also to prevent tax evasion.
Przemysław Szabat, tax adviser and member of the Tax Committee of Employers of Poland presented tax optimization opportunities with the use of foreign jurisdictions after the of the above mentioned regulations come into force.
He also addressed the issue of the anti-tax avoidance clause and expressed particular concern with the extraordinarily low threshold of substantial tax benefit. According to guidelines of the Ministry of Finance, this threshold will be set at 50 thousand PLN, while CFC regulations will apply to companies with income equivalent to 250 thousand euro per year or more.