Who is affected by the information on the implementation of the tax strategy?
The order of topics covered is not coincidental – rather than prolonging the article and reporting every detail in the introduction, we will start with the substance.
Information on the implemented tax strategy shall be prepared and made available:
- PGKs – tax capital groups, regardless of the amount of revenue earned;
- enterprises whose annual revenue exceeded EUR 50 million, calculated according to the average exchange rate of the currency quoted by the National Bank of Poland on the last working day of the year preceding the year of publication of the above. information.
Provisions on the said obligation went into effect on January 1, 2021. – For details, see art. 27c of the CIT Law.
How to check if the obligation applies to your company?
Currently (as of September 1, 2022), more than 6,000 entities must prepare and publish a tax strategy. If you are not sure whether the obligation applies to you, check the list of individual data of CIT taxpayers on the website of the Ministry of Finance – the law obliges the Minister to publish and update the data of CIT taxpayers, so it should be assumed that the list available at the link is equivalent to the list of entities required to publish information on the implementation of the tax strategy.
What is a tax strategy?
Now that you know if you need to take an active interest in the topic of tax strategy, let’s go back to the beginning and answer the question: what is tax strategy really? Although the concept of tax strategy does not have a legal definition, an attempt to condense the meaning of the term has been made by the authors of the Internal Tax Supervision Framework Guidelines.
Tax strategy – an attempt to define
According to the mentioned guidelines, the tax strategy should:
- indicate the fiscal vision and mission and long-term goals of the company;
- report that the company treats tax issues as part of its responsibility, and paying them as returning part of its profit to society;
- maintain consistency with the strategy of the entity that prepares it;
- be always up-to-date and adapted to changes in the organization.
In connection with the last point, the RWNP Guidelines instruct that a company preparing a tax strategy should use a revision procedure that includes a description of responsibility for controlling and monitoring the tax strategy being implemented.
Important!
The purpose of the tax strategy is to ensure tax compliance for the company – so the document should cover issues such as:
- tax risk,
- appetite for risk,
- The level of involvement of the governing body in the tax planning decision-making process,
- reporting,
- making a declaration,
- payment of tax liabilities.
What elements should a tax strategy contain?
The Corporate Income Tax Law specifies what elements should be included in the tax strategy information published by companies – the relevant recommendations can be found in Art. 27c para. 2 of the Law. We are talking about information on processes and procedures for managing the performance of tax law obligations and ensuring their proper implementation. The scope includes:
- procedure for the circulation and control of documents,
- procedure on how to control the correctness of the submission of tax returns and payments,
- VAT procedure,
- A procedure to limit the risk of liability from the CCC,
- WHT (Withholding Tax) and CRBR (Central Register of Beneficial Owners) procedures,
- procedure against money laundering and financing of terrorism,
- The procedure for the implementation of obligations on tax schemes,
- other tax procedures or instructions.
The company’s tax strategy must also not lack:
- Information on forms of cooperation with the National Tax Administration authorities (participation in pilot projects, interaction program, etc.),
- data on the implementation of tax obligations in the territory of Poland (including the amount of taxes paid and tax refunds received),
- Information on transactions carried out between the taxpayer and related parties,
- Information on transactions related to the taxpayer’s restructuring activities,
- data on the number of reported schemes and submitted requests for interpretations and rate information from tax authorities.
For more details on how to develop a tax strategy, see the RWNP Guidelines mentioned above.
What is the deadline for publishing information on the implementation of the tax strategy?
The deadline for public disclosure of information on the implemented tax strategy is the last day of the twelfth month following the end of the fiscal year. When a company’s fiscal year coincides with the calendar year – that is, in the vast majority of cases – the deadline for submitting the information will be December 31.
Thus, for the 2021 fiscal year (assuming it ran from January 1, 2021 to December 31, 2021), the information should be published no later than December 31, 2022.
How to publish information about the implemented tax strategy?
The correct way to publish a tax strategy is determined by the CIT Law. The taxpayer subject to the obligation should post the relevant information on its website, or, if it does not have one, on the website of a related party. The information should be prepared in Polish, and the head of the tax office responsible for the taxpayer should be informed about the fact of its publication on the Internet. To do this, use electronic means of communication (listed in the Law on Provision of Electronic Services – Art. 2 point 5 of the Law) – in other words: from e-mail.
The email to the head of the tax authority should include the address of the website where the information about the implementation of the company’s tax strategy was posted.
The legislature provides for a fine for failure to publish information on the tax strategy being implemented. The penalty is imposed by the head of the tax authority, and the amount can reach up to 250,000. PLN.
