From the point of view of cross-border financial transactions, withholding tax on interest or royalties is an extremely important element of calculation. Theoretically speaking, the amount of this tax is obvious because it results from agreements to prevent double taxation. Theoretically, because in Poland it does not have to be obvious.
In October 2018, a provision was introduced to the CIT Act, according to which in the case of payments exceeding PLN 2 million, taxpayers are obliged to pay tax in the amount resulting from Polish regulations, i.e. in the amount of 20%. It is only when the conditions for exemption are met and as a result of an overpayment that the taxpayer can apply for a refund of the overpayment.
The Ministry of Finance is clearly aware of the madness of this solution, as a result of which its entry into force has already been suspended twice – in December 2018 and June this year. If this right belief persists in the Ministry – we will rather wait nervously with this determination until the end of the year.