Withholding tax
Withholding tax is a tax that is generally paid by Polish companies (tax payers) in connection with the certain payments to foreign companies, including the payment of dividends (19%), interest (loan or credit) or remuneration for consultancy services (20%). Previous regulations allowed for the exemption of such payments from withholding tax in Poland or were subject to a reduced rate of withholding tax (e.g. 5% or 15%), provided certain legal requirements were met. From 01/07/2020 similar rules will apply, but with other important changes.
If the amount paid out to the same taxpayer (i.e. the same foreign company) exceeds PLN 2,000,000.00 during a tax year, the taxpayer will be obliged, as a rule, to collect without exemption of withholding tax at an unreduced Polish withholding tax rate (as a rule 19% or 20%) and pay it to the Polish tax office in case of the excess over PLN 2,000,000.00.
The withholding tax can then be notified for reimbursement under a special procedure. Under the new rules, there are now two ways to waive the need to collect withholding tax, i.e. obtain a certificate of exemption from withholding tax or submit a declaration by all members of management board of the taxpayer.
We will be happy to assist you in obtaining tax benefit