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Accounting for a branch office in Poland

Many foreign companies entering Poland opt for operating as a branch office.

When considering this form of business, you should note that a branch office is a business organisation without full legal capacity (i.e. all actions taken within the branch will be performed on account of the foreign business entity).

However, from the accounting perspective, a branch office in Poland is obliged to maintain full accounting records (provided that the turnover for the first year of business exceeds EUR 2 million) and prepare standalone financial statements.
 

Electronic sick leave certificates

After December 1, 2018, provisions related to electronic sick leave certificates (zwolnienie lekarskie) enter into force. In the case of employers employing up to five persons, there is no obligation for the employer to set up a profile on PUE ZUS electronic platform. Such employers are bound to inform the staff that sick leave certificate should be delivered in paper form.

Temporary limitation by the legislator of the right to deduct VAT from ICA not in compliance with the Directive

In accordance with the applicable provisions of the VAT Act, taxpayers are entitled to settle input and output tax due under the intra-Community acquisition of goods (hereinafter referred to as ICA) for the period in which the tax obligation arose, provided that within three months from the end of the month in which in the tax obligation for the purchased goods arose, they receive an invoice documenting ICA and settle the output tax in the proper VAT return.
 

Depreciation write-offs are likewise subject to CIT restrictions

In the verdict of May 9, 2018 (ref. no. I SA/Op 108/18) relating to Art. 15e of the CIT Act, that first and foremost limits the tax-deductible costs incurred by the taxpayer to acquire specific intangible services and rights from affiliates, the Voivodship Administrative Court in Opole took the position that the linguistic and teleological interpretation of said article makes it clear that it also implies the exclusion of depreciation write-offs made on the assets listed therein.

The definitive VAT system – the VAT Directive prior to the fundamental change

According to the calculations of the European Commission, cross-border fraud each year produce a loss of EUR 50 billion in VAT revenue in the EU. Therefore, in order to limit losses, on May 25, 2018, the European Commission proposed detailed amendments to the EU VAT-related provisions. The amendments are to involve no less than 200 of the 408 articles of the Directive 2006/112/EC, most of which will be essential for the Community VAT system.
 

Percent-based determined license fees do not fall under the deductible costs limit

On April 3, 2018 the Director of the National Tax Information confirmed the position of the taxpayer in a case that is interesting from the point of view of a CIT taxpayer. In the presented context, the license agreement made companies incur, for the beneift of the related entity, license costs covering the know-how related to the generation of products, including license for formulas and technical parameters of products as well as technical parameters pertaining to raw materials.
 
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