Poland’s Council of Ministers has presented a legislative agenda to amend the Individual Income Tax Law (IITL), Corporate Income Tax Law (CITL), and other tax measures. The proposed changes are intended to simplify tax regulations, remove interpretive ambiguities, and strengthen the tax system’s integrity.
Poland aims to implement this project in the third or fourth quarter of 2024, which means it is expected to go into effect on 1 January 2025.
The main provisions of the proposed solutions are organised into three categories:
Amendments to benefit taxpayers
- Expanding the scope of the exemption under Article 17(1)(4) of the CITL to include income from all non-governmental organisations, provided the income is dedicated to public activities and is not related to commercial activities;
- Granting tax exemption to compensation paid by insurers to injured parties under a deductible franchise;
- Making expenses incurred by local government units on thermo-modernisation projects (umbrella projects) eligible for tax relief;
- Explicitly permitting taxpayers to deduct losses from previous years when calculating the solidarity tax;
- Revising and clarifying provisions concerning the taxation of Controlled Foreign Companies (CFC);
- Amending regulations for determining income and expenses in company mergers where no shares are allocated.
Restricting measures
- Restricting regulations on the taxation of family foundations;
- Introducing employment requirements within the IP Box tax framework.
- Expanding the calculation base for the solidarity tax to encompass qualifying income under the IP Box regime and benefits received by family foundation beneficiaries;
- Amending rules related to restructuring activities, including company transformations, share exchanges, and share devaluations;
- Revising rules for deducting flat-rate income tax on the earnings of general partners in limited partnerships and joint-stock partnerships.
Technical, organisational, and clarification enhancements
This includes clarifying interpretative ambiguities concerning “financial resources” in EU tax-exempt assistance, streamlining rules for lump-sum taxation of company income, and clarifying transfer pricing regulations.
