On 26 July 2021, the Government of Poland has announced a draft legislation concerning following tax reform related to corporate taxation.
- New definition of the place of effective business management aimed at limiting situations in which Polish residents set up businesses in foreign jurisdictions while they are not doing any real business in that foreign jurisdiction.
- New tax exemptions for Polish holding companies, including an exemption of 95% of dividends received from qualifying subsidiaries and an exemption from capital gains tax on the sale of shares in these qualifying subsidiaries, under certain conditions.
- Pay-and-refund regime of withholding taxation, which finally comes into effect after a few deferrals.
- Changes the method of maximum thresholds for calculation tax deductible financing cost, which can reduce deductions and increase the tax base.
- Provide the restrictions on the deductibility of costs, including intercompany debt, financing of share purchases, or the cost of certain services provided by shareholders and board members.
- The tax depreciation of real estate may not exceed write-offs for accounting purposes.
- The tax depreciation of residential property would be inadmissible.
