Month: October 2021

Winners of the 20th edition of the Podkarpacie Region Economic Award competition are known! The GWW tax advisory team received an award in the "best products" category for JPK Insight (now TAX Insight).

The Podkarpacie Region Economic Award selects the best and most economically active businesses in the Podkarpacie region. The award ceremony of this year's edition took place on October 27 during the Podkarpacie Region Economic Congress at the G2A Arena in Jasionka.

Find more information at: https://png.pl/ 

 

On October 31, a new register will enter into force for entities providing services to companies or trusts. It is the result of the amendment to the Act on Counteracting Money Laundering and Terrorism Financing and some other acts (AML).

Who is obliged to register?

Activities for companies or trusts is a business activity involving the provision of services such as:

• creating a legal person or an organizational unit without legal personality;
• performing the function of a management board member or enabling another person to perform this function or a similar function in a legal person or an organizational unit without legal personality;
• providing a registered office, business address or correspondence address, and other related services to a legal person or an organizational unit without legal personality;
• acting or enabling another person to act as a trustee of a trust that was created through a legal action;
• acting or allowing another person to act as a person exercising rights resulting from stocks or shares for an entity other than a listed company that is subject to disclosure requirements under European Union law or subject to equivalent international standards.

The newly introduced register leads to the treatment of the above-mentioned catalog of activities as regulated activities. Therefore, in order to start conduting them, it will be necessary to obtain an entry into the new register. This rule does not apply to attorneys-at-law, lawyers and law companies.

Particular attention should be paid by the companies which, within a capital group, provide a registration address or sublet space to other related entities. They will also be required to register.

The application for registration will be submitted only in electronic form via the ePUAP platform, on forms that will be shared by the Ministry of Finance. The register will have its own website.

Entities that currently conduct activities included in the above-mentioned catalog should receive an entry in the register by April 30, 2022, whereas those that plan to start such activity from October 31, 2021 or later should obtain such entry in the register before actually commencing this type of activity.

Pursuant to the new regulations, entities operating for the benefit of companies or trusts that perform these activities without being entered in the relevant register shall be subject to a financial penalty of up to PLN 100,000.00.

Would you like to find out more? Contact our experts:
Aldona Leszczyńska-Mikulska i Tomasz Krzywański

We quote below a fragment of a decision on discontinuation of the PIT proceedings for 2015, which was issued by the head of the customs and tax office in the case of one of our clients. For a long time, the tax authority considered the share exchange transaction as only apparent, claiming at the same time that the actual intention of parties was a fiduciary transfer of shares. Consequently, the income from the sale of the shares contributed in-kind should have been recognized by the contributing entity, acting in the capacity of the entrusting entity.

“(…) it cannot be reasonably argued that legal relations have been established between the Party and the Q Company, particularly characteristic of the third of the above-mentioned necessary elements of the trust agreement. In this case, the element in the form of the trustee's obligation to transfer back the ownership of the goods (rights) assigned to the entrusting entity is missing.

In the case in question, there is no clear evidence that the Q Company obliged itself to act this way (namely to trasnfer back the goods/rights) – it could only be presumed from a series of consecutive events. However, even assuming that the above-mentioned activities (assessed jointly) were only aimed at achieving the intended fiscal effect, there is no basis to conclude that the act of transferring the shares was apparent. (…)

Therefore, the evidence collected in the case, especially in the light of the presented court judgments, does not allow concluding that the Company share transfer agreement was an apparent agreement. In view of the foregoing, it should be stated that it is not possible to apply Article 199a § 2 of the Tax Ordinance in this case."

The customs and fiscal audits as well as tax proceedings in this case lasted almost 4 years. During this time, the viewpoint of the office head regarding the assessment of tax consequences of the activities carried out changed as many as three times!

The success gives two reasons to celebrate – apart from the favorable decision, we managed to convince the tax authority to change the originally adopted position, without the need to involve the administrative court.

The received decision confirms our thoughts indicated in the previous publication [https://gww.pl/en/news_/niekorzystny-wynik-kontroli-podatkowej-nie-zawsze-/]:

• in disputes with tax/customs authorities, it is worth being consistent in presenting arguments to support correctness of tax settlements. In the analyzed case, the entire instance path of the proceedings has been exhausted – from the customs and fiscal audit, through the decision of the 2nd instance authority revoking the decision of the 1st instance authority, up to the 1st instance authority's decision to discontinue the proceedings;
• audit report/result unfavorable for the taxpayer or even a decision in the 1st instance authority does not automatically mean that the authority has issued a final tax assessment decision;
• in the legal status existing before 15 July 2016, the Polish legal system lacked regulations that would allow tax authorities to question a properly conducted tax optimization.

Lawyers from the income tax team: Jacek Olczyk and Mariusz Tkaczyk, GWW partner, were in charge of the case.

Małgorzata Miliz, GWW partner and Vice-President of the Mazovian Branch of National Chamber of Tax Advisors (KIDP) will be one of the speakers of the Mazovian Tax Forum taking place today.

The Mazovian Tax Forum is an event addressed to tax advisers, academic teachers and students; it aims at presenting the latest changes and trends in tax law and economy.

The meeting is organized by: the European Law Students Association ELSA Warsaw and the Mazovian Branch of the National Chamber of Tax Advisors, Mazowiecki Branch.

Register at: https://stayhappening.com/e/iii-mazowieckie-forum-podatkowe-E2ISU0WI6MW

For this year's, 17th edition of the A. Woyciechowski Radio Zet Award, thirteen journalistic materials were nominated. Among them, there are TV reports, press publications, Internet publications, a film reportage, and a radio documentary series.

Check the nominations at: Nagroda Radia Zet im. Andrzeja Woyciechowskiego – nominacje

The winners will be announced during a gala ceremony that will take place on 18 November this year.

A. Woyciechowski Radio Zet Awards have been granted since 2005. The competition is considered to be one of the most prestigious journalistic awards in Poland. It distinguishes journalists whose materials break stereotypes and show the backstage of the reality that surrounds us.

The GWW law office is the legal partner of the A. Woyciechowski Radio Zet Award.

In practice, companies are often merged by acquisition. It consists in receiving, inter alia, by the acquiring company of all assets of the acquired company. Is the acquiring company also liable for actions of the acquired company made in breach of law? The article by Marcin Borkowski, Ph. D., was published in today's issue of Dziennik Gazeta Prawna.

https://www.gazetaprawna.pl/firma-i-prawo/artykuly/8273929,spolka-przejmujaca-odpowiada-za-dzialania-spolki-przejetej.html

The winners of the competition "Podatki są proste jak drut" (Taxes are a piece of cake) for the best master's thesis in the field of tax law have been selected and the awards have been granted! The competition was directed to university graduates, whose master's theses were strictly devoted to tax law issues. Congratulations to the winners!

During the gala of Laureates and Winners of Awards, awards were granted to the winners of the 7th and 8th editions of the competition. People who have been actively promoting the profession of tax advisor and the local government of MO KIDP (the Mazovian Branch of the National Chamber of Tax Advisors) over the past 25 years were also awarded.

The gala was hosted by Paweł Trojanek, Chairman of the Management Board of the Mazovian Branch of KIDP, and Małgorzata Militz, Vice-President of the Management Board of the Mazovian Branch of KIDP.

The Mazovian Branch of the National Chamber of Tax Advisors is the organizer and initiator of the competition.

Link to the recording of the event: https://fb.watch/8EXreb_2Ur

The public procurement team of GWW won a tender for the legal support of the Central Region of the Polish State Railways PKP PLK. The contract will be concluded for three years and it is worth approximately PLN 2 million.

Since last year, we have also been providing legal support to the Investment Realization Center of the Małopolska Region and the Silesian Region of PKP PLK.

Legal services for PKP PLK are handled by Michał Sękowski and Marta Lipińska.

During today's Wolters Kluwer conference "Tax Rollercoster, or the everyday life of accountants and tax advisors", our expert, Małgorzata Militz, discusses the jurisprudence of the administrative courts of the Court of Justice. The review of legal cases will include controversial, most important judgments that affect the work of accounting offices and tax advisors.

"(…) provisions of Art. 15 (1), art. 16b (1) in connection with Art. 15 (6), Art. 16h (3) and Art. 16g (9) of the CIT Act in connection with Art. 93 of the Tax Ordinance do not replace instruments that allow the tax authority to counteract tax avoidance, including to question making depreciation charges on trademarks and treating them as tax deductible costs by the Company following the acquisition of subsidiaries.

 

In the analyzed period, there were no provisions in the tax law system constituting a general clause enabling tax authorities to take measures aimed at preventing tax avoidance: section III a of the Tax Ordinance Act "counteracting tax avoidance" – it was added to the Act on 15 July 2016."

 

The above-mentioned position was presented by the head of the customs and tax office in a decision on discontinuation of tax proceedings at one of our clients. Interestingly, the same customs and tax office came to completely different conclusions at the stage of the audit result, pointing to irregularities in determining the initial value of trademarks for the purpose of their depreciation.

The received decision leads to three reflections:

– it is worth being consistent in presenting arguments justifying correctness of tax settlements in disputes with tax/customs authorities,

– the result of the audit, which is unfavorable for the taxpayer, does not automatically mean that the authority will isse a tax assessment decision,

– in the legal status in force before 15 July 2016, the Polish legal system lacked regulations that would allow tax authorities to question a properly conducted tax optimization.

The case was handled by Jacek Olczyk and Mariusz Tkaczyk, GWW partner, supervisor of the Tax Planning practice.