Questions and answers – WHT

Some double taxation conventions indicate that, in the case of interest on instalment payments, the payer will not be subject to withholding tax. For example, pursuant to Article 11(3)(c) of the DTC between Poland and Germany, in the case of a sale on credit of...

Some double tax agreements contain a rule that allows affiliated entities to enjoy the benefits of the agreement (reduced rate) if the interest paid abroad is in line with the market price. When the interest exceeds the market value, affiliated entities may apply the...

Payers transferring receivables abroad obliged to settle the withholding tax will not be able to fail to bear responsibility if the tax was not collected through the taxpayer's fault, in a situation where money transfers concern affiliated entities within the meaning...

If the remitter has paid the tax from its own resources and has borne the economic burden of the tax, it may include the withholding tax as a tax deductible cost in a situation where the obligation of the remitter to pay the tax results from the provisions of a...

Interest in the Polish legal system has no legal definition. Under the OECD Model Convention, interest is defined as income from debt claims of all kinds, whether or not secured by mortgage or right to participate in the debtor's profits, and in particular, income...

In the context of withholding tax settlements, this concept has been in force since 1 January 2019, but the legislator has not introduced a legal definition of this concept, which means that verification of its compliance depends on the assessment of each individual...

A multilateral convention implementing treaty-based tax law measures to prevent the erosion of the tax base and the transfer of profits (MLI) modifies double taxation conventions (DTC) in a synchronised manner, without the need for time-consuming bilateral...

Double taxation agreements on the avoidance of double taxation concluded between Poland and a given country/jurisdiction (pol. UPO) allow to apply a preferential tax rate or exemption when settling withholding tax. The correct determination of the amount of the tax...

Neither the definition of the certificate of residence nor other provisions of the tax law specify in what form (paper or electronic) the certificate should be delivered to the tax authority. It is only indicated that the official documents, including the certificate...

A certificate of residence is a document issued by the competent tax administration of a taxpayer, confirming the place of residence of the taxpayer for tax purposes, which in the case of corporate income tax payers is the place of its registered office or management...

The correct determination of the beneficial owner of the receivables paid affects the possibility of direct application of exemptions, the possibility of not collecting the tax or applying a reduced rate. The payer is obliged to determine the beneficial owner and it...

The beneficial owner is the entity that actually, i.e. actually receives receivables paid to non-residents for payments subject to withholding tax. Pursuant to Article 4a(29) of the Corporate Income Tax Act, the beneficial owner is an entity which, firstly, receives...

Intangible services include consulting services, accounting market research, legal services, advertising, management and control services, data processing, employee recruitment and staff acquisition services, guarantees and warranties and similar services. It is...

The withholding tax obligation applies to the revenues indicated in art. 21 section 1 and 22 section 1 of the Corporate Income Tax Act. It includes such titles of payment as: interest, copyrights or related rights, rights to invention projects, trademarks and...

Poland has signed 90 bilateral double taxation agreements. A list of agreements and their contents is available on the website of the Ministry of Finance. However, Polish entities wishing to take advantage of the privileges of such an agreement (for example, in order...