The amendment adapts Poland’s CIT regulations to the rulings of the CJEU concerning investment and pension funds.
Poland’s Council of Ministers has adopted a draft amendment to Poland’s Corporate Income Tax (CIT) Act on 14 October 2025, aligning it with recent rulings by the Court of Justice of the European Union (CJEU).
The changes focus on extending tax exemptions for investment and pension funds, ensuring compliance with the EU’s principle of free capital movement.
Currently, Polish investment and pension funds enjoy CIT exemptions, with some restrictions, such as limitations on real estate investments. Similar tax benefits have been available to EU and European Economic Area (EEA) funds that meet specific conditions, such as being under proper supervision and managed by external, licensed entities. These funds can receive exemptions from Polish withholding tax (WHT) on income like dividends from Polish companies.
The CJEU has ruled that these exemptions should also apply to funds managed by a management board and to comparable funds from non-EU countries, as the principle of free capital movement extends to third countries under EU Treaties. The proposed amendment reflects this by broadening the WHT exemption to include such funds.
To prevent misuse of these WHT exemptions for tax avoidance, the amendment introduces safeguards. These include allowing tax authorities to access data on Polish residents with accounts in foreign funds, denying exemptions for artificial structures, and requiring proper authorisation for fund management.
The updated regulations are set to take effect on 1 January 2026.
