(a) Dividends may be exempt based on the regulations implementing the Parent-Subsidiary Directive, subject to conditions there stated (10% shareholding and two-year holding period; exemption applicable without withholding obligation even if this period elapses after the dividend is distributed). Also, reduced rate of withholding tax or exemption may apply to dividends based on the relevant double tax treaties.
(b) Interest and royalties may be exempt based on the regulations implementing the Interest-Royalties Directive, subject to conditions there stated (in the transitional period between July 1 2009 and June 30 2013 – 5% rate applies). Also, reduced rate of withholding tax or exemption may apply to interest and royalties based on the relevant double tax treaties.
(c) Maximum 50% of each year's loss may be utilised in any of the following five years
Advisers agree that Poland has not felt the recession as badly as other European countries. One said the Polish economy "is ok" and "hasn't deteriorated too much". As such, there have been no particular tax measures introduced this year to overcome the ...
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Advisers agree that Poland has not felt the recession as badly as other European countries. One said the Polish economy "is ok" and "hasn't deteriorated too much". As such, there have been no particular tax measures introduced this year to overcome the economic downturn. Multinational clients, however, are under increased pressure to cut spending and save cash. As Poland is still a desirable destination for foreign investment, this is impacting the Polish tax environment. One tax professional said the type of work his team is doing has changed this year. "Transactions are rare; only a small amount is being done," he said. "Most of them are appointed to smaller firms." He said his firm is doing more commercial restructuring and restructuring of financial portfolios.
The tax authorities have become more active and advisers are worried this will lead to more litigation. New VAT legislation early next year is also expected to boost the amount of tax disputes. "VAT is a problematic tax in Poland. There are a lot of disputes," one tax practitioner said. Four out of the six lawyers in his team handle litigation.
Poland saw changes to VAT legislation and transfer tax laws last year. The country's tax market felt the impact of these adjustments this year.
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