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Corporate Income Tax Act

z dnia 15 stycznia 1992 r. (Dz.U. tum. gb Nr 21, poz. 86)

Chapter 1. Taxpayers and object of


taxation.
Art. 1 [Scope of this Act]
1. This Act regulates taxation with income tax of income of legal persons and capital
companies, hereinafter referred to as "taxpayers".
2. The provisions of this Act shall also apply to unincorporated organizational entities, with
the exception of unincorporated companies, subject to paragraphs 1 and 3.
3. The provisions of this Act shall also apply to unincorporated companies, whose seat or
head office are located in another state, if in accordance with the tax laws of that state they are
treated as legal persons and are in that state taxed on their total income regardless of where it
has been generated.
Art. 1a [Tax capital group]
1. Taxpayers may also be groups of at least two incorporated commercial law companies
related by capital, hereinafter referred to as "tax capital groups".
2. A tax capital group shall be a taxpayer only when all of the following requirements have
been met:
1) a tax capital group may be formed exclusively by limited liability or joint-stock companies
whose seats are located in the territory of the Republic of Poland, providing:
a) the average initial capital, determined in the manner, referred to in Article 16.7, of each of
those companies is not lower than PLN 1 000 000;
b) one of the companies, hereinafter called the "dominant company, has direct 95% interest in
the initial capital or in that part of the initial capital of the other companies, hereinafter called
"subordinated companies", which pursuant to commercialization and privatization regulations
has not been free-of-charge or on preferential terms acquired by employees, farmers or
fishermen, or which is not included in the restitution reserve of the property of the State
Treasury;
c) the subordinated companies do not have interest in the initial capital of other companies in
the group;
d) those companies have no arrears with respect to payment of taxes constituting revenues of
the state budget;
2) the dominant company and the subordinated companies have concluded, in the form of a
notarial deed, an agreement for establishment, for a period of a least 3 tax years, of a tax
capital group and that agreement, hereafter called "the agreement", has been registered by the
head of fiscal office;
3) following the establishment of a tax capital group the companies of that group meet the
requirements laid down in subparagraph 1 letters (a) to (c), and moreover:
a) do not utilize income tax exemptions under separate acts of law;
b) do not have relationship, resulting in situations, referred to in Article 11, with income tax
taxpayers from outside of the tax capital group;
4) the tax capital group will attain, for each tax year, a share of income in revenues,
determined in accordance with Article 7a.1, amounting to at least 3%.
2a. The requirement laid down in paragraph 2.1 letter (d) shall be considered to have been met
also when after joining a tax capital croup a company has adjusted its tax return and has made
up for those arrears plus interest due within 14 days from the date of filing the tax return
adjustment, or within 14 days from the date of delivery of the decision of a first instance body
determining the amount of the liability has made up for those arrears plus interest due.
3. The agreement has to, at least:
1) provide a list of companies making up the tax capital group and the amounts of their initial
capital;
2) provide information on the participants (shareholders) and their shares in the initial capital
in the dominant companies and the subordinated companies making up the tax capital group,
holding at least 5% of those companies shares (stocks);
3) define the duration of the agreement;
4) identify the company representing the tax capital group with respect to obligations
provided for in this Act and in the Taxation Act;
5) identify the tax year adopted.
4. The agreement shall be submitted by the company, identified in accordance with paragraph
3.4, to the head of fiscal office competent for its seat, at least 3 months before the beginning
of the tax year adopted by the tax capital group. That body shall be competent for matters of
taxation of the tax capital group with income tax.
5. The head of fiscal office shall register the agreement in the form of a decision. The head of
fiscal office shall in the same form refuse to register the agreement, if the requirements,
referred to in paragraph 2.1 and in paragraphs 3 and 4, have not been met.
6. Follwing registration, the agreement may not be expanded to include other companies.
7. Income tax and withholding tax shall be assessed, collected and paid by the company,
referred to in paragraph 3.4. The company shall not be entitled to remuneration for punctual
payment of corporate income tax due from the capital group.
8. The company, referred to in paragraph 3.4, shall be obliged to report to the head of fiscal
office, referred to in paragraph 4, any changes in the agreement and changes in the initial
capital of the companies making up the capital group - within 30 days from the occurrence of
those circumstances.
9. In order to extend the period of functioning of the tax capital group a new agreement shall
be concluded, which shall be submitted to and registered by the competent head of fiscal
office.
10. Should any changes take place in the duration of the agreement with respect to the facts or
legal status, which are under control of any of the parties thereto and which violate the
requirements for recognizing the capital groups as an income tax taxpayer, the date of
violation of any of those requirements, subject to paragraph 12, shall mean the loss of the
taxpayer status and the end of its tax year.
11. Selling of shares (stocks), received under commercialization or privatization regulations
or in connection with restitution, and further trading in those shares (stocks) by their holders
shall not constitute violation of the requirements for recognizing the capital groups as an
income tax taxpayer.
12. If the requirement, referred to in paragraph 2.4, is not kept, the last day of the month in
which tax a return was filed, though not later that the date which in accordance with Article
27.1 is the time limit for filing that return, shall be deemed to be the date of losing the
taxpayer status by the capital group.
13. Joining another tax capital group by any of the companies previously included in the
group which lost that status as a result of violation of the requirements, referred to in
paragraph 2.3 and 2.4, shall not be possible before the end of the tax year of the company
following the year in which the tax capital group lost the right to be recognized as a taxpayer.
14. The companies making up a tax capital group shall be jointly and severally liable for its
income tax liabilities due for the duration of the agreement.
15. Information on registration and crossing out of a tax capital group shall be announced in
Monitor Sdowy i Gospodarczy.
Art. 2 [Exclusions]
1. The provisions of this Act shall not apply to:
1) revenues from agricultural activities, with the exception of income from special sectors of
agricultural production, unless determination of revenues is required to assess income free
from income tax pursuant to Article 17.1.4e;
2) revenues from forestry within the meaning of the Forestry Act;
3) revenues arising from actions which cannot be regulated by legally valid contracts;
2. Agricultural activities, within the meaning of paragraph 1.1, shall be activities consisting in
generating unprocessed (natural) plant or animal products from own farming or animal
husbandry, including production of seeds, nursery products, breeding or reproductive
material, production of soil-, greenhouse- and plastic tunnel-grown vegetables, production of
ornamental plants, cultivated mushrooms and fruits, breeding and production of breeding
material of animals, fowl and farm insects, industrial animal production and fish farming, as
well as activities under which the minimum periods of keeping purchased animals and plants
in the course of which their biological growth takes place, amount to at least:
1) 1 month - in case of plants;
2) 16 days - in case of highly intensive fattening of geese or ducks;
3) 6 weeks - in case of other slaughter poultry;
4) 2 months - in case of other animals
- counting from the date of acquisition.
3. Special sectors of agricultural production include: plant growing in hothouses and heated
plastic tunnels, growing of mushrooms and their mycelia, "in vitro" growing of plants, farm
breeding and raising slaughter and laying poultry, poultry hatcheries, breeding and raising fur
and laboratory animals, breeding of earthworms, breeding of entomophaga, breeding of
silkworms, bee-keeping, as well as breeding and raising of other animals outside of an
agricultural undertaking.
4. Whenever in this Act there is a mention of an agricultural undertaking, this shall mean an
agricultural undertaking within the meaning of the provisions of the Agricultural Tax Act.
5. Breeding and raising of animals in quantities not exceeding the amounts specified in Annex
No. 2 to this Act, referred to as "Annex No. 2" shall not constitute special sectors of
agricultural production.
6. If the size of special sectors of agricultural production exceeds the figures laid down in
Annex No. 2, income derived in the tax year from the entire area under crops or all production
units shall be taxable.
Art. 3 [Tax liability]
1. Taxpayers, if their seat or head office is in the territory of the Republic of Poland, shall be
liable to pay tax on the entirety of their income regardless of where they have been generated.
2. Taxapyers who do not have a seat or head office in the territory of the Republic of Poland,
shall be liable to pay tax only on income generated in the territory of the Republic of Poland.
Art. 4 [Territory of the Republic of Poland] The territory of the Republic of Poland within the
meaning of this Act shall also be deemed to include the exclusive economic zone situated
beyond the territorial sea, where the Republic of Poland, under internal laws and in
accordance with international law, exercises the rights concerning exploration and
exploitation of the sea bed and its subsoil, as well as their natural resources.
Art. 4a [Definitions] Whenever in this Act there is a mention of:
1) investments - it shall mean fixed assets under construction within the meaning of the
Accounting Act of 29 September 1994 (Dz.U. of 2002 No. 76, item 694), hereinafter referred
to as "the Accounting Act";
2) assets - it shall mean assets within the meaning of the Accounting Act, net of debts taken
over and functionally linked with the business operations of the transferor, providing those
debts have not been covered by the acquisition price, referred to in Article 16g.3;
3) an undertaking - it shall mean an undertaking within the meaning of the provisions of the
Civil Code;
4) an organized part of an undertaking - it shall mean a set of tangible and intangible assets,
including commitments, organizationally and financially separate in an existing undertaking,
appropriated for implementation of specific business targets, which at the same time could
operate as an independent undertaking implementing those targets on its own;
5) a restructuring programme under separate acts of law - it shall mean restructuring under the
following acts of law:
a) of 26 November 1998 on Adjustment of Coalmining to Functioning in the Market
Economy and Special Powers and Tasks of Mining Communities (gminas) (Dz.U. of 1998
No. 162, item 1112 and of 2001 No. 5, item 41 and No. 154, item 1802),
b) of 7 October 1999 on Support to the Restructuring of the Industrial Defence Potential and
Technical Modernization of the Armed Forces of the Republic of Poland (Dz.U. of 1999 No.
83, item 932, of 2000 No. 119, item 1250 and of 2001 No. 76, item 805 and No. 100, item
1080),
c) of 14 July 2000 on Financial Restructuring of Sulphur Mining (Dz.U. of 2000 No. 74, item
856),
d) of 8 September 2000 on Commercialization, Restructuring and Privatization of the State
Enterprise "Polskie Koleje Pastwowe" (Polish State Railways) (Dz.U. of 2000 No. 84, item
948 and of 2001 No. 100, item 1086 and No. 154, item 1802),
e) of 24 August 2001 on Restructuring of Iron and Steel Metallurgy (Dz.U. of 2001 No. 111,
item 1196),
6) fiscal office - it shall mean a fiscal office, led by the head of fiscal office competent for the
taxpayer;
7) the Goods and Services Tax Act - it shall mean the Goods and Services Tax Act of 11
March 2004 (Dz.U. No. 54, item 535).
Art. 5 [Income from joint source]
1. Revenues from a shareholding in an unincorporated company, subject to Article 1.3, from
joint property, joint venture, joint ownership or joint use of things or property rights shall be
combined with revenues of each of the partners in proportion to his shareholding. In case no
evidence to the contrary is available it is assumed that the shares of partners in revenues are
equal.
2. The principles, referred to in paragraph 1, shall apply, as appropriate, to accounting for
deductible costs, non-deductible expenses, tax exemptions and reliefs, and to reduction of
income, taxable base or tax.
Art. 6 [Exemptions]
1. The following entities shall be free from income tax:
1) the State Treasury;
2) the National Bank of Poland;
3) budgetary entities;
4) targeted funds, referred to in the Public Finance Act of 26 November 1998 (Dz.U. No. 155,
item 1014, of 1999 No. 38, item 360, No. 49, item 485, No. 70, item 778 and No. 110, item
1255, of 2000 No. 6, item 69, No. 12, item 136, No. 48, item 550, No. 95, item 1041, No.
119, item 1251 and No. 122, item 1315, of 2001 No. 45, item 497, No. 46, item 499, No. 88,
item 961, No. 98, item 1070, No. 100, item 1082, No. 102, item 1116, No. 125, item 1368 and
No. 145, item 1623 and of 2002 No. 41, item 363 and 365, No. 74, item 676 and No. 113,
item 984), unless the provisions of the acts establishing those funds stipulate otherwise;
5) international undertakings and other economic entities established by a state administration
body jointly with other states under an agreement or treaty, unless those agreements or treaties
provide otherwise;
6) local government units with respect to income described in the provisions of the Act on
Income of Local Government Units;
7) the Agency for Restructuring and Modernization of Agriculture;
8) (deleted)
9) the Agricultural Market Agency;
10) investment funds operating pursuant to the provisions of the Act of 27 May 2004 on
Investment Funds (Dz.U. No. 146, item 1546);
11) pension funds established pursuant to the regulations on organization and functioning of
pension funds;
12) the Social Security Company (ZUS), referred to in the Social Security Act of 13 October
1998 (Dz.U. No. 137, item 887, No. 162, item 1118 and 1126, of 1999 No. 26, item 228, No.
60, item 636, No. 72, item 802, No. 78, item 875 and No. 110, item 1256 and of 2000 No. 9,
item 118),
13) the Agricultural Real Property Agency.
14) (repealed)
2. The exemption, referred to in paragraph 1.3, shall not apply to subsidiary undertakings of
budgentary entities, with the exception of subsidiary undertakings set up at schools,
kindergartens, school districts, voluntary work brigades, units of: the armed forces, Police
Force, Internal Security Agency, Intelligence Agency, organizational units of: Prison Guards,
Border Guards and State Fire Service, juvenile institutions, dormitories, care and educational
institutions, health care facilities, social welfare facilities and national parks, if the funds
derived from that exemption are appropriated for:
1) (deleted)
2) increasing working capital of subsidiary undertakings;
3) financing of investments of a budgetary entity with respect to investments for a subsidiary
undertaking of that entity.
Art. 7 [Object of taxation and loss]
1. The object of taxation with income tax shall be income regardless of the type of revenue
sources from which that income has been derived; in cases, referred to in Articles 21 and 22,
the object of taxation shall be revenues.
2. Income shall be, subject to Articles 10 and 11, the excess of the sum total of revenues over
deductible costs generated in the tax year; if deductible costs exceed the sum total of
revenues, the difference shall be loss.
3. While assessing income constituting the taxable base the following shall not be taken into
account:
1) revenues from revenue sources located in the territory of the Republic of Poland or abroad,
if income from those sources is not taxable with income tax or are exempted from income tax;
2) revenues, referred to in Articles 21 and 22;
3) deductible costs, referred to in subparagraphs 1 and 2;
4) losses of transformed, merged, acquired or divided undertakings - in case of transformation
of legal form, merger or division of undertakings, with the exception of transformation of a
capital company into another capital company;
5) losses of state enterprises taken over or acquired pursuant to commercialization and
privatization regulations.
4. While assessing loss, revenues and deductible costs, referred to in paragraph 3, shall not be
taken into account, and in case of transformation of legal form, merger or division of
undertakings, also losses of transformed, merged, acquired or divided undertakings, with the
exception of capital companies transformed into other capital companies.
4a. While assessing loss, losses of state enterprises taken over or acquired pursuant to
commercialization and privatization regulations shall not be taken into account, either.
5. The amount of the loss, referred to in paragraph 2, incurred in the tax year may be deducted
from income generated in the next consecutive five tax years, with the proviso that the
amount of the deduction in any of those years may not exceed 50% of the amount of that loss.
Art. 7a [Income and loss in tax capital group]
1. In tax capital group the object of taxation with income tax, calculated in accordance with
Article 19, shall be income derived in the tax year, being the excess of the sum total of
incomes of all companies making up the group over the sum total of their losses. If the sum
total of losses for a tax year exceeds the sum total of incomes of the companies, the difference
shall be loss of the tax capital group. Incomes and losses of companies shall be calculated in
accordance with Article 7.1 to 7.3.
2. Loss, referred to in paragraph 1, incurred by a tax capital group shall not be covered from
income of individual companies should the duration of the agreement expire or should the tax
capital group lose its status for reasons laid down in Article 1a.10.
3. Income of a tax capital group shall not be used to cover losses of the companies making up
the group, incurred before the group was established.
Art. 8 [Tax year]
1. The tax year, subject to paragraphs 2, 2a, 3 and 6, shall be the calendar year, unless the
taxpayer decides otherwise in the statute, or the articles of association, or any other document
regulating the systemic rules of other taxpayers, and notifies of this the competent head of
fiscal office; in that case the tax year shall be the period of twelve consecutive calendar
months.
2. In case of starting activities for the first time, the first tax year shall last from the date of
starting the activities until the end of the calendar year or until the last day of the selected tax
year, though not longer than twelve consecutive calendar months.
2a. In case of starting activities for the first time in the latter half of the calendar year and
selecting the tax year overlapping the calendar year, the first tax year may last from the date
of starting the activities until the end of the calendar year following the year in which the
activities were started.
3. In case of changing the tax year, the first tax year after the change shall be the period from
the first month following the end of the previous tax year until the end of the newly adopted
tax year. That period may not be shorter than twelve and longer than twenty three consecutive
calendar months.
4. The notification, referred to in paragraph 1, shall be submitted not later than within 30 days
as of the end of the last tax year.
5. Legal persons and organizational entities, which so far have not been taxpayers within the
meaning of the Act, shall submit the notification, referred to in paragraph 1, within 30 days
from starting activities.
6. If separate regulations provide for an obligation to close account books (draw up a balance-
sheet) before the end of the tax year adopted by the taxpayer, the tax year shall be the period
from the first day of the month following the end of the previous tax year until the closing of
the account books. In that case, the next tax year shall be the period from the opening of the
account books until the end of the tax year adopted by the taxpayer.
7. The provisions of paragraphs 1-5 shall apply, as appropriate, to tax capital groups. For
individual companies making up the group:
1) the day preceding the beginning of the tax year adopted by the group shall be the day of
ending the tax year of those companies;
2) the day following the date of expiration of the agreement or of losing the tax capital group
status by the group shall be the day of starting the tax year of those companies.
Art. 9 [Determination of income (loss)]
1. Taxpayers shall be obliged to keep accounting records, in accordance with separate
regulations, in a manner allowing for determination of the amount of income (loss), the
taxable base and the amount of the tax due for the tax year, and also to take into account in the
inventory of fixed assets and intangible assets information necessary to calculate the amount
of depreciation write-offs in accordance with Article 16a-16m.
2. Should it prove impossible to determine income (loss) in a manner provided for in
paragraph 1, income (loss) shall be determined by estimation.
2a. In case of taxpayers other than those referred to in Article 3.2, obliged to keep accounting
records, referred to in paragraph 1, when it is impossible to determine income on the basis of
those records, income shall be determined by estimation, using the ratio of income in relation
to revenues amounting to:
1) 5% - from wholesale or retail trade operations;
2) 10% - from construction or assembly operations, or transport services;
3) 60% - from agency services, if remuneration is set as a commission;
4) 80% - from attorney or expert services;
5) 20% - from other sources.
2b. Wholesale or retail trade operations, referred to in paragraph 2a.1, performed in the
territory of the Republic of Poland by taxpayers, referred to in Article 3.2, shall mean selling
of goods to Polish buyers regardless of the place of contracting.
2c. The provisions of paragraph 2a and 2b shall not apply when the agreement on avoidance
of double taxation, to which the Republic of Poland is a party, signed with the country, in the
territory of which the taxpayers seat or place of residence is located, provides otherwise.
3. The minister competent for public finance, by way of an ordinance, may introduce a duty to
take physical inventory of certain commodities in case of a change in their price.
Art. 9a [Transaction documentation]
1. Taxpayers engaged in transactions with entities related with those taxpayers - within the
meaning of Article 11.1 and 11.4 - or transactions in connection with which the resulting
receivables are paid directly or indirectly in favour of an entity whose place of residence, seat
or head office are located in a territory of or country applying harmful tax competition, shall
be obliged to make out tax documentation of such transaction(s) containing:
1) description of functions to be performed by entities engaged in the transaction (taking into
account the assets used and the risks taken);
2) description of all anticipated costs of the transaction, as well as the form and date of
payment;
3) method and manner of calculating profits and pricing of the object of the transaction;
4) description of business strategy and other actions thereunder - in case the value of the
transaction was affected by the strategy adopted by the entity;
5) indication of other factors - when in order to define the value of the object of the
transaction by the entities engaged therein those other factors were taken into account;
6) description of performance related benefits expected by the entity obliged to make out the
documentation - in case of agreement concerning performances (including services) of an
intangible nature.
2. The duty, referred to in paragraph 1, shall cover a transaction or transactions between
related entities, in which the total contractual amount (or its equivalent) or the total amount of
performances required in the tax year actually paid in the tax year has exceeded the equivalent
of:
1) EUR 100 000 - if the value of the transaction is less than 20% of the initial capital,
determined in accordance with Article 16.7; or
2) EUR 30 000 - in case of performance of services, selling or leasing intangible assets; or
3) EUR 50 000 - in other cases.
3. The duty to make out documentation, referred to in paragraph 1, shall also cover a
transaction in connection with which the resulting receivables are paid directly or indirectly in
favor of an entity whose place of residence, seat or head office are located in a territory of or
country applying harmful tax competition, if the total contractual amount (or its equivalent) or
the total amount of performances required in the tax year actually paid in the tax year has
exceeded the equivalent of EUR 20 000.
4. At the request of tax authorities or fiscal control authorities taxpayers shall be obliged to
present the documentation, referred to in paragraphs 1-3, within 7 days from the date of
delivery of those authorities request for the documentation.
5. The amounts expressed in EUR, referred to in paragraphs 2 and 3, shall be converted into
the Polish currency at the average rate of exchange as announced by the National Bank of
Poland, effective as at the last day of the tax year preceding the tax year in which the
transaction, covered by the duty, referred to in paragraph 1, was concluded.
6. The minister competent for public finance shall specify, by way of an ordinance, the list of
countries and territories applying harmful tax competition. Compiling the list of countries and
territories, the minister competent for public finance shall take into account, in particular, the
contents of the decisions adopted in that respect by the Organization for Economic
Cooperation and Development (OECD).
Art. 10 [Income from a share in profits of legal persons]
1. Income (revenues) from a share in profits of legal persons, subject to Article 12.1.4a and
12.1.4b, shall be income (revenues) actually derived under that share, including:
1) income from retirement of shares (stocks);
2) income from selling shares (stocks) to the company in order to be retired;
3) the value of assets received in connection with liquidation of a legal person;
4) income appropriated for an increase of the initial capital, and in cooperatives - income
appropriated for an increase of the share fund and income being an equivalent of the amounts
transferred to that capital (fund) from other capitals (funds) of a legal person;
5) in case of merger or division of companies - additional payments in cash received by the
participants (shareholders) of the acquired company, merged or divided companies;
6) in case of division of companies, if assets taken over as a result of the division, and in case
of division by spin-off also assets remaining in the company, do not constitute an organized
part of an undertaking - the excess of the nominal value of shares (stocks) allotted in the
acquiring ot newly established company over the costs of acquisition or receipt of shares
(stocks) in the divided company determined as at the date of the division, calculated in
accordance with Article 15.1k or Article 16.1.8; if the company is divided by spin-off,
deductible cost shall be the value or amount of expenses incurred by a participant
(shareholder) for acquisition or receipt of shares (stocks) in the divided company, determined
in the same proportion as the nominal value of that participants cancelled shares (stocks) in
the divided company to the value of nominal value of shares (stocks) before the division;
7) payment, referred to in Article 12.4d.3.
1a. If a legal person derives revenues from agricultural activities and other revenue sources,
the total amount of income, referred to in paragraph 1, shall be reduced by income from
agricultural activities obtained for the same reporting period, with the exception of income
from special sectors of agricultural production. Should it be impossible to determine income
to be deducted from the total amount, that income shall be determined in the same proportion
as the revenues from agricultural activities, with the exception of revenues from special
sectors of agricultural production, are to the total amount of revenues.
1b. The provisions of paragraph 1.1 and 1.2 shall not apply in case of retirement of shares
(stocks) received in exchange for a contribution in kind in the form of an undertaking or an
organized part thereof.
2. In case of a merger or division of capital companies:
1) the excess of the value of the assets of the acquired or divided company received by the
acquiring or newly established company over the nominal value of shares (stocks) awarded to
the participants (shareholders) of the acquired or divided company shall not be treated as
income, referred to in paragraph 1, of the acquiring or newly established company;
2) income of the acquiring company which has an interest in the initial capital of the acquired
or divided company of not less than 25% in terms of votes, shall be the excess of the value of
the acquired assets corresponding with the percentage share in the initial capital of the
acquired or divided company over deductible costs calculated in accordance with Article
15.1k or Article 16.1.8; that income shall be determined as at the date of crossing out the
acquired or divided company from the register or as at the date of the spin-off.
3. (deleted)
4 . The provisions of paragraph 2.1 and Article 12.4.12 shall not apply when the merger or
division of the companies are not carried out for economically justified reasons, but the
principal goal or one of the principal goals of such transaction is to avoid or evade taxation.
5. The provisions of paragraph 2 shall apply exclusively to the taxpayer companies:
1) referred to in Article 3.1, acquiring assets of other companies having their seats or head
offices in the territory of the Republic of Poland; or
2) referred to in Article 3.1, acquiring assets of companies having their seats or head offices in
the territory of a European Union member state; or
3) referred to in Article 3.2, having their seats or management in the territory of a European
Union member state, acquiring assets of taxpayer companies, referred to in Article 3.1.
6. The provisions of paragraphs 1-5 shall be applied, as appropriate, to entities listed in Annex
No. 3 to this Act.
Art. 11 [Foreign linkages]
1. If:
1) an income taxpayer, whose seat (head office) or place of residence is located in the territory
of the Republic of Poland, hereinafter called the "domestic entity", takes part, directly or
indirectly, in management of an undertaking located abroad, or in controlling it, or has an
interest in the capital of that undertaking; or
2) a natural or legal person, whose seat (head office) or place of residence is located abroad,
hereinafter called the "foreign entity", takes part, directly or indirectly, in management of a
domestic entity, or in controlling it, or has an interest in the capital of that domestic entity; or
3) the same legal or natural persons simultaneously, directly or indirectly, participate in
management of a domestic entity and foreign entity, or in controlling them, or have interest in
the capital of those entities
- and if as a result of such linkages conditions shall be agreed or imposed differing from those
which would have been agreed by independent entities, and as a result of that the entity does
not show any income or shows income lower than would have been expected should those
linkages be nonexistent - income of that entity and the tax due shall be determined without
taking into account the conditions resulting from those relationships.
2. Income, referred to in paragraph 1, shall be determined, by way of estimation, by the
following methods:
1) the comparable uncontrolled price method;
2) the resale price method;
3) the reasonable margin ("cost plus") method.
3. If it is impossible to apply the methods, referred to in paragraph 2, the transaction profit
methods shall be applied.
4. The provisions of paragraphs 1-3 shall apply, as appropriate, when
1) a domestic entity participates directly in management of another domestic entity, or in
controlling it, or has an equity interest in another domestic entity; or
2) the same legal or natural persons simultaneously, directly or indirectly, participate in
management of domestic entities, or in controlling them, or have an equity interest in those
entities.
5. The provisions of paragraph 4 shall apply also to relationships of a family nature or arising
from an employment or property relationships between domestic entities or persons
performing in those entities management or controlling or supervisory functions and if any
person combines management or controlling or supervisory functions in those entities.
5a. Having an equity interest in another entity, referred to in paragraphs 1 and 4, shall mean a
situation whereby a given entity holds directly or indirectly an equity interest in another
equity which is not less than 5%.
5b. Determining the size of indirect equity interest held by an entity in another entity, it is
assumed that if one entity has a specified equity interest in the other entity, and the other has
the same equity interest in another entity, the former entity has indirect equity interest in that
other entity of the same size; if those figures are different, the lower one shall be taken as the
size of indirect equity interest.
6. The notion of family relationships, referred to in paragraph 5, shall mean marriage and
consanguinity or affinity to the second degree.
7. (repealed)
7a. (repealed)
8. The provisions of paragraph 4 shall not apply in case of performances between companies
making up a tax capital group.
9. The minister competent for public finance shall specify, by way of an ordinance, the
manner and procedure for determining income by estimation, by methods referred to in
paragraphs 2 and 3.

Rozdzia 2. Revenues.
Art. 12 [General notion of revenue]
1. Revenues, subject to paragraphs 3 and 4 and Articles 13 and 14, shall be, in particular:
1) cash and cash equivalents received, including foreign exchange gains;
2) the value of things or rights received free of charge or partially free of charge, as well as
the value of other free-of-charge or partially free-of-charge performances, with the exception
of performances linked with utilization of fixed assets received by budgetary establishments,
subsidiary undertakings of budgetary entities, public utility companies 100% owned by local
government bodies or their associations from the State Treasury, local government units or
their association for gratuitous management or use;
3) the value, subject to paragraph 4.8, of remitted or time-barred:
a) debts, including loans (credits), with the exception of remitted loans from the Labour Fund;
b) money in bank accounts - in banks;
4) the value of repaid amounts due, which were written off, in accordance with Article
16.1.25 or 16.1.43, as lost or extinct, and classified as deductible costs;
4a) for participants of investment funds - funds income received, if its statute provides for
payment of income without redemption of participation units or redemption of investment
certificates;
4b) for managers of state-owned enterprises - remuneration under management contracts,
including the right to a share in enterprises profits;
4c) the value of returned amounts due under the agreement, referred to in Article 17f,
previously classified as deductible costs pursuant to Article 17h;
4d) the value of amounts due, remitted, time-barred or written off as lost in that part on which
revaluation write-offs were previously classified as deductible costs;
4e) the equivalent of revaluation write-offs on amounts due, previously classified as
deductible costs, in case the reasons underlying those write-offs ceased to exist;
4f) in case of reduction or refund of the goods and services tax or refund of excise duty in
accordance with separate regulations - input goods and services tax or refunded excise duty,
in that part in which the tax or duty were previously classified as deductible costs;
4g) the amount of the goods and services tax:
a) not included in the initial value of fixed assets and intangible assets depreciated in
accordance with Article 16a-16m; or
b) relating to things or rights other than fixed assets or intangible assets, referred to in letter
(a)
- in that part, in which the adjustment was made as a result of which the tax deducted in
accordance with Article 91 of the Goods and Services Tax Act was increased;
5) for insurers - the amount equivalent to the reduction of technical reserves established in
accordance with separate regulations
5a) the equivalent of released or reduced provisions, referred to in Article 16.1.27, previously
classified as deductible costs;
6) in banks - the amount equivalent to:
a) general banking risk provision established in accordance with the Banking Act of 29
August 1997 (Dz.U. of 2002 No. 72, item 665, No. 126, item 1070, No. 141, item 1178, No.
144, item 1208 and No. 153, item 1271), released or utilized otherwise;
b) released or reduced provisions, referred to in Article 16.1.26, previously classified as
deductible costs, subject to paragraph 4.15(b);
7) the par value of shares (stocks) in a capital company or a cooperative - received in
exchange for a contribution in kind in the form other than an undertaking or an organized part
thereof; the provisions of Article 14.1-14.3 shall apply, as appropriate;
8) consideration received by the taxpayer as a result of retirement of shares (stocks) received
in exchange for a contribution in kind in the form of an undertaking or an organized part
thereof;
9) in case of division of companies, if assets taken over as a result of the division, and in case
of division by spin-off also assets remaining in the company, do not constitute an organized
part of an undertaking - the market value of assets transferred to the acquiring or newly
established companies, determined as at the date of the division or spin-off; the provisions of
Article 14.2-14.3 shall apply, as appropriate;
1a. In case of repayment of a part of the amount due, referred to in paragraph 1.4, income
shall be determined in proportion to the share of the repaid part of the amount due in the total.
1b. Income described in paragraph 1.7 shall arise as at the date of:
1) registering a capital company; or
2) entering an increase of initial capital of a company into a register; or
3) issue of share documents, if the receipt of shares is linked with the conditional increase of
initial capital.
2. Revenues in foreign currencies shall be converted into Polish zlotys in accordance with the
average exchange rates applicable on the date income was generated, as announced by the
National Bank of Poland.
2a. Revenues generated as a result of foreign exchange differences on own financial assets in
foreign currencies shall be determined as a difference between the value of those assets
calculated at the currency purchasing rate as at the date on which revenues were actually
received and currency purchasing rate as at the date of their receipt, or the currency selling
rate as at the date of acquisition of currencies, as announced, as appropriate, by the bank,
whose services were used by the taxpayer.
3. Revenues from commercial activities and special sectors of agricultural production
generated in the tax year shall also be the amounts due, even though not actually received,
having excluded the value of goods returned, rebates and discounts granted. If revenues are
denominated in foreign currencies, and between the date on which they were generated and
the date on which they were actually received various exchange rates were applicable, those
revenues shall be increased or reduced, as appropriate, by the differences arising from
application of the currency purchasing rate as at the date of the actual receipt of revenues, as
determined by the bank whose services were used by the revenue generating party, and
application of the average exchange rate as announced by the National Bank of Poland as at
the date on which revenues were generated.
3a. The date on which revenues were generated, referred to in paragraph 3, shall be, subject to
paragraphs 3c and 3d, the date of invoicing (billing), though not later than the last day of the
month, in which:
1) the thing was delivered, the property right was sold, or
2) the service was performed, including partially performed service, if its partial performance
constitutes a title for payment under a contract or separate regulations; or
3) payment for the performance was received - in other cases.
3b. (repealed)
3c. Revenues generated under rent, tenancy, leasing or similar agreements shall be revenues
due determined as at the date at which the amounts arising under those agreements become
payable.
3d. In case of settlements relating to:
1) the supply of electricity, heat or pipe gas;
2) the supply of telecommunication and radiotelecommunication services, with the exception
of prepaid services, including telephone services;
3) water distribution, wastewater management, waste disposal and neutralization services
- the date on which revenues are generated shall be the due date for payment specified in the
invoice, and if that date is not specified - the last day of the month in which the invoice was
issued.
4. Revenues shall not include:
1) payments collected or amounts due entered in the books on account of deliveries of goods
and services, which will be effected in the following reporting periods, as well as loans
(credits) obtained or repaid, with the exception of capitalized interest on those loans (credits);
2) the amounts of accrued but not received interest on amounts due, also including interest on
loans (credits) extended;
3) returned shares (stocks) in a company or shares in a cooperative, retirement of shares or
stocks in a company, including the amounts received from selling shares (stocks) to the
company in order to be retired, and the value of assets received in connection with liquidation
of a legal person - in the part constituting the cost of their purchasing or receipt, and also
refunds of additional payments made by the participants (shareholders) under separate
regulations - in the amount determined in PLN as at the date of their actual contribution;
4) revenues received for the creation or increase of the initial capital, the share fund or the
initial fund, or the statutory fund in a state bank, or the organizational fund of an insurer;
4a) revenues received by an investment fund company on account of subscriptions for
participation units or investment certificates;
5) revenues, which within the meaning of the company social benefits fund regulations
increase that fund;
6) refunded, remitted or waived taxes and duties constituting income of the state budget or
budgets of local government units, not classified as deductible costs;
6a) other refunded expenses not classified as deductible costs;
6b) refunded, remitted or waived contributions paid to the State Fund for Rehabilitation of the
Disabled pursuant to separate regulations, not classified as deductible costs;
7) interest received in connection with the refund of overpaid taxes and other amounts owed
to the budget, as well as interest on the refund of the goods and services tax difference, within
the meaning of separate regulations;
8) amounts equivalent to remitted debts, including remitted loans (credits), if remittal of those
debts is related to:
a) bank arrangement proceedings within the meaning of regulations concerning financial
restructuring of companies and banks; or
b) bankruptcy proceedings involving the possibility to enter into an arrangement within the
meaning of the bankruptcy and restructuring law; or
c) implementation of a restructuring programme pursuant to separate acts of law;
9) the goods and services tax due;
10) the difference in the goods and services tax due refunded under separate regulations;
10a) the amounts due by virtue of the goods and services tax exempt from payment within the
meaning of the goods and services tax regulations;
11) additional payments made by the companies, if made in accordance with the procedure
and principles laid down in separate regulations, with respect to the amounts and assets in
excess of the nominal value of shares (stocks), received upon their issue and appropriated for
reserve capital, and in cooperatives and their associations - the value of the initial fee,
appropriated for the reserve fund;
12) in case of merger or division of capital companies, subject to paragraph 10.1.6, revenues
of a participant (shareholder) of the acquired or divided company, in excess of the nominal
value of shares (stocks) allotted by the acquiring or newly established company;
13) revenues from selling under a transfer of ownership agreement as security for a debt,
including a loan or credit - until final transfer of ownership of the object of the agreement;
14) the value of received gratuitous or partially gratuitous things or rights, and the value of
other gratuitous or partially gratuitous performances financed or co-financed with the funds
from the state budget, local government units, with the funds of government agencies or with
the funds provided by the governments of foreign states, international organizations or
international financial institutions, under government programmes;
15) in banks:
a) nominal value of shares (stocks) of enterprises under a restructuring programme
implemented pursuant to separate acts of law, received in exchange for debts under credits
(loans) extended to those enterprises, for which provisions were established previously
classified as deductible costs; in case of selling those shares (stocks) deductible costs shall not
be determined;
b) provisions classified as deductible costs, released or reduced as a result of exchanging
debts under credits (loans) for shares (stocks) of enterprises under restructuring programme
pursuant to separate acts of law;
c) revenues from selling debts under credits (loans) sold to a securitization fund or an
investment fund company establishing a securitization fund of debts under credits (loans) - up
to the amount of the unpaid portion of credits (loans) extended;
16) the value of performances received from voluntaries, provided in accordance with the
principles laid down in the regulations concerning public benefit and voluntary activities;
17) amounts equivalent to the value of real property left outside of the present borders of the
Polish state in the part credited, pursuant to separate regulations, to the sales price or perpetual
usufruct charges with respect to real property of the State Treasury.
4a. (deleted)
4b. In case of contracts for renting or leasing things or property rights and similar contracts, if
the renting or leasing party transferred the claims with respect to rents or fees arising from
such contracts to a third person, and those contracts between the parties do not expire, the
revenues of the renting or leasing party shall not include the amounts paid by the third party
for the transfer of claims. Fees paid by the tenant or leaseholder to the third party shall
constitute revenues of the landlord or lessor as at the due date.
4c. In case of selling loaned securities in accordance with the principles laid down in separate
regulations (short selling), income shall be determined as at the date at which the borrowed
securities were returned or were to be returned, in accordance with the concluded securities
loan agreement.
4d. In case of taxpayers selling shares (stocks) of one capital company to another capital
company, if:
1) in a members state of the European Union the purchasing company and the selling
(receiving) company are taxed on the entirety of their income regardless of where its has been
generated; and
2) as a result of purchasing shares (stocks) the purchasing company acquires the absolute
majority of votes in the company whose shares (stocks) are sold; and
3) in exchange for the shares (stocks) sold the selling company receives shares (stocks) of the
purchasing company or receives shares (stocks) of the purchasing company together with a
consideration in cash not larger than 10% of the balance-sheet value of the shares (stocks)
received
- the value of shares (stocks) received in the selling company and the purchasing company
shall not be included in revenues.
4e. The principles, laid down in paragraph 4.15(c) shall not apply to revenues from selling
debts in the part concerning interest, including capitalized interest on credits (loans).
5. The monetary value of things or rights received free of charge shall be determined in
accordance with market prices applicable in trading of things or rights of the same type and
quality, in particular taking into account their condition, degree of wear, as well as the time
and place of obtaining them.
5a. The value of partially paid for things or rights constituting taxpayers revenues shall be the
difference between the value of those things or rights, determined in accordance with the
principles laid down in paragraph 5, and the consideration paid by the taxpayer. The provision
of Article 14.3 shall apply, as appropriate.
6. The value of gratuitous performances shall be determined in the following manner:
1) if the performance concerns services included in the commercial activities of the
performing party - at prices applied to other recipients;
2) if the performance concerns purchased services - at purchasing prices;
3) if the performance concerns letting the use of premises - at the equivalent of the rent that
would have been due under a potential lease contract for those premises;
4) in other cases - in accordance with market prices applied in the performance of services or
letting the use of things or rights of the same type and quality, taking into account their
condition, degree of wear, as well as the time and place of letting them for use.
6a. The value of partially paid for performances constituting taxpayers revenues shall be the
difference between the value of those performances, determined in accordance with the
principles laid down in paragraph 6, and the consideration paid by the taxpayer. The provision
of Article 14.3 shall apply, as appropriate.
7. (deleted)
8. (deleted)
9. The provision of Article 4.15(c) shall not apply to the amounts of repaid credits (loans)
received, not transferred to a securitization fund or an investment fund company establishing
a securitization fund - after 5 days from the due date of their transfer.
10. The provision of paragraph 1.4g shall apply, as appropriate, should the right to deduct
input tax from output tax, referred to in Article 91.7 of the Goods and Services Tax Act,
change.
11. The provisions of paragraph 4d shall be applied, as appropriate, to entities listed in Annex
No. 3 to this Act.
Art. 13 [Real property let over for use free of charge]
1. Income from all or part of real property let over for use free of charge to other natural and
legal persons and unincorporated organizational entities, subject to paragraph 3, shall be the
equivalent of the rent that would have been due under a potential tenancy or lease contract for
real property, determined in accordance with the average amount of rents applicable in a
given locality for leasing out real property of the same kind.
2. The provision of paragraph 1 shall not apply while letting over for use:
1) residential premises to persons remaining with the taxpayer in employment relationship, for
whom it constitutes gratuitous performance within the meaning of the provisions of the
Personal Income Tax Act;
2) real property or its part for the purposes of scientific, scientific-technical, didactic,
educational, cultural activities, activities in the field of physical culture and sports,
environment protection, charity, health protection and social welfare, occupational and social
rehabilitation of disabled persons, religious cult and to trade unions.
3. The provisions of Article 12.4.7, 12.4.9 and 12.4.10 shall apply, as appropriate.
Art. 14 [Sale of assets]
1. Revenues from selling real property or property rights, subject to paragraphs 4 and 5, shall
be their value expressed as the price specified in the contract. If, however, the price, without a
justified reason, substantially differs from the market value of those things or rights, that
revenue shall be determined by the tax authority at market value.
2. The market value, referred to in paragraph 1, of things or property rights shall be
determined on the basis of market prices applicable in trading of things or rights of the same
kind and quality, taking into account, in particular, their condition and degree of wear, and the
time and place of selling.
3. If the value expressed as the price in the sales contract substantially differs from the market
price of those things or rights, the tax authority shall request the parties to adjust that value or
indicate reasons justifying the price substantially differing from the market value. In case of
no answer being given, no adjustment being made of the value, or no indication being given
as regards the causes justifying the price substantially differing from the market value, the tax
authority shall determine the value taking into account expert opinion. If the value so
determined differs by at least 33% from the value expressed as the price, the costs of the
expert opinion shall be borne by the selling party.
4. The provisions of Article 12.4.7, 12.4.9 and 12.4.10 shall apply, as appropriate.
5. (deleted)

Rozdzia 3. The deductible costs.


Art. 15 [Definition of costs]
1. The deductible costs shall be all costs incurred in order to derive revenues, with the
exception of costs referred to in Article 16.1. Costs incurred in foreign currencies shall be
converted into Polish zlotys in accordance with the average exchange rates as announced by
the National Bank of Poland on the date when the cost was incurred. If costs are denominated
in foreign currencies, and there is a difference in the currency exchange rates between the date
of entering those costs in the books and the date of payment, those costs shall be increased or
reduced, as appropriate, by the differences arising from the application of the currency selling
rate as at the date of payment, set by the bank, whose services were used by the person who
incurred the cost, and the application of the average exchange rate as announced by the
National Bank of Poland on the date of entering the costs in the books.
1a. Costs of foreign exchange gains/losses with respect to own funds or cash denominated in
foreign currencies shall be determined as the difference between the value of those funds
calculated at the selling rate of actual payment and the currency purchasing rate at their
receipt, or the selling rate of currency acquisition, announced, as appropriate, by the bank,
whose services were used by the taxpayer.
1b. For insurers, the deductible costs for the tax year shall be the costs determined in
accordance with paragraph 1, and also:
1) technical reserves established pursuant to separate regulations - up to the incremental
amount of those reserves as at the end of the tax year in relation to the beginning of the year;
while determining withholding tax, referred to in Article 25.1, deductible cost shall be the
incremental amount of technical reserves, for which the tax declaration is filed, in relation to
the beginning of the tax year;
2) write-offs for the prevention fund in the amount specified in separate regulations, if the
write-offs increase the fund;
3) payments with respect to insurance supervision, provided for in insurance regulations.
1c. (deleted)
1d. The deductible costs shall also be expenses incurred by the employer in order to ensure
correct implementation of the employee pension plan within the meaning of the regulations on
employee pension plans.
1e. For pension funds (Powszechne Towarzystwo Emerytalne, PTE), the deductible costs for
the tax year shall be the costs determined in accordance with paragraph 1, and also:
1) expenses incurred for covering the costs of operation of an open pension fund;
2) amounts transferred to the reserve account of an open pension fund;
3) expenses incurred to cover a shortage in an open pension fund if the balance of its reserve
account is not sufficient to cover that shortage;
4) payments made to the Guarantee Fund, referred to in the Act of 28 August 1997 on
Organization and Functioning of Pension Funds (Dz.U. No. 139, item 934, of 1998 No. 98,
item 610, No. 106, item 668 and No. 162, item 1118 and of 1999 No. 110, item 1256) - up to
the amount specified in separate regulations;
5) fees charged by the Commission for Supervision of Insurance and Pension Funds, referred
to in the Act mentioned in subparagraph 4.
1f. For employee pension funds, the deductible costs for the tax year shall be the costs
determined in accordance with paragraph 1, and also:
1) expenses incurred for covering the costs of operation of an employee pension fund;
2) fees charged by the Commission for Supervision of Insurance and Pension Funds, referred
to in the Act mentioned in paragraph 1e.4.
1g. For employees being shareholders of an employee pension fund deductible costs for the
tax year shall be the costs determined in accordance with paragraph 1, and also:
1) expenses incurred for covering the costs of operation of an employee pension fund;
2) fees charged by the Commission for Supervision of Insurance and Pension Funds, referred
to in the Act mentioned in paragraph 1e.4.
1h. In banks deductible costs shall also be:
1) the general banking risk provision established in the tax year in accordance with Article
130 of the Act, referred to in Article 12.1.6;
2) loss from selling debts under credits (loans) sold to a securitization fund or an investment
fund company establishing a securitization fund, constituting a difference between the
proceeds from selling and the value of debts under credits (loans) - up to the amount of the
provision previously established for those debts, classified as deductible costs, in accordance
with this Act;
3) transferred to a securitization fund or an investment fund company establishing a
securitization fund:
a) proceeds from securitized debts;
b) principal amounts of securitized debts;
c) amounts obtained from realization of collateral for securitized debts
- covered by a subparticipation agreement.
1i. In case of selling gratuitously or partially gratuitously acquired things or rights, as well as
other gratuitously or partially gratuitously acquired performances, in connection with which,
pursuant to Article 12.5-12.6a, revenues have been determined, the deductible cost with
respect to their selling, allowance having been made for their revaluation in accordance with
separate regulations, shall be:
1) the value of revenues specified in Article 12.5 and 12.6; or
2) the value of revenues specified in Article 12.5a and 12.6a, plus expenses with respect to
acquiring partially gratuitous things or rights, or other performances
- minus the sum total of depreciation write-offs, referred to in Article 16h.1.1.
1j. In case of the acquisition of shares (stocks) in a company or shares in a cooperative in
exchange for a contribution in kind other than an undertaking or an organized part thereof -
the deductible cost with respect to revenues, referred to in Article 12.1.7, shall be determined
as at the date of acquisition of those shares (stocks) as:
1) the initial value of the contribution in kind, revaluated in accordance with separate
regulations, minus the sum total of depreciation write-offs, referred to in Article 16h.1.1,
made before the contribution was brought in, if the contribution in kind was in the form of
fixed assets or intangible assets;
2) the following value:
a) the nominal value of shares (stocks) in a company or shares in a cooperative brought in as a
contribution in kind, when they had been acquired in exchange for a contribution in kind other
than an undertaking or an organized part thereof;
b) determined in accordance with Article 16.1.8, when shares (stocks) in a company or shares
in a cooperative, which are brought in as a contribution in kind, had not been acquired in
exchange for a contribution in kind;
c) determined in accordance with paragraph 1k, when shares (stocks) in a company or shares
in a cooperative, which brought in as a contribution in kind, had been acquired in exchange
for a contribution in kind in the form of an undertaking or an organized part thereof
- if the object of the contribution in kind were shares (stocks) in a company or shares in a
cooperative;
3) the costs, not classified as deductible, actually incurred on acquiring taxpayers assets other
than those mentioned in subparagraph 1 and 2 - if the object of the contribution in kind were
those other assets.
1k. In case of selling shares (stocks) in a company or shares in a cooperative acquired in
exchange for a contribution in kind, as at the date of selling those shares (stocks), the
deductible costs shall be determined in the amount of:
1) the nominal value of acquired shares (stocks) as at the date of their acquisition - if those
shares (stocks) had been acquired in exchange for a contribution in kind other than an
undertaking or an organized part thereof;
2) the value of the undertaking or an organized part thereof, arising from the books of the
undertaking, determined as at the date of the acquisition of those shares (stocks), though not
higher than their the nominal value as at the date of acquisition.
1l. The provisions of paragraph 1k shall apply, as appropriate, in case of retirement of shares
(stocks) received in exchange for a contribution in kind or their selling to the company to be
retired, to determination of the cost, referred to in Article 12.4.3.
1. The deductible costs with respect to revenues, referred to in Article 12.1.9, shall be
expenses, updated in accordance with separate regulations, minus the sum total of
depreciation write-offs, referred to in Article 16h.1.1, incurred for the acquisition of assets
transferred to the acquiring or newly established companies.
1m. In case of selling shares (stocks) acquired as a result of the division, referred to in Article
10.1.6, the deductible cost of selling shares (stocks) in the acquiring or newly established
company shall be their nominal value determined as at the date of registering the increase of
the initial capital of the acquiring company or as at the date of registering newly established
companies.
1n. In case of selling loaned securities, referred to in Article 12.4c, the deductible cost shall be
the expenses incurred on repurchase of the securities in order to return them.
1o. If in connection with the acquisition of shares (stocks) in exchange for a contribution in
kind the taxpayer incurred expenses connected with the acquisition of those shares (stocks),
those expenses shall be added to the deductible costs, referred to in paragraph 1j.
1p. The provision of paragraph 1h.2 and 1h.3 shall not apply to the amounts of repaid credits
(loans) received, not transferred to a securitization fund or an investment fund company
establishing a securitization fund - after 5 days from the due date of their transfer.
1q. For telecommunication companies, the deductible costs shall be the costs determined in
accordance with paragraph 1, and also:
1) the amount of the additional payment, referred to in Article 95.1 of the
Telecommunications Act of 16 July 2004 (Dz.U. No. 171, item 1800);
2) the amount of the annual telecommunications fee, referred to in Article 183 of the Act
mentioned in subparagraph 1.
2. If the taxpayer incurs deductible costs with respect to income from sources of taxable
income, and costs with respect to revenues from other sources, and it is not possible to
determine what deductible costs are related to individual sources, those costs shall be
determined in the proportion equal to the share of revenues from those sources in the total
amount of revenues.
2a. The principle, referred to in paragraph 2, shall apply also when the taxpayer incurs
deductible costs with respect to revenues from sources, from which part of revenues is
taxable, and part is tax-free; in such case, the provision of Article 7.3.3 shall apply, as
appropriate.
3. In order to determine the value of raw materials and materials derived from own plant or
animal production and own forestry used for agricultural and food processing or in special
sectors of agricultural production, the provision of Article 12.5 shall apply, as appropriate.
4. The deductible costs shall be deducted only in the tax year, which they relate to, i.e.
deductible are also costs incurred in the years preceding the tax year, but relating to revenues
derived in the tax year and specified as to type and the amount of costs entered in the books,
even though they have not been incurred yet, if they refer to revenues of a given tax year,
unless their entering in the books was not possible; in that case they shall be deductible in the
year when they were incurred.
5. The minister competent for public finance shall specify, by way of an ordinance, the
procedure and times for revaluation of fixed assets, referred to in Article 16a.1 and 16a.2.1-
16a.2.3, the initial value of assets, referred to in Article 16d.1, the unit acquisition price of
components and peripherals, referred to in Article 16g.13, and the initial value of fixed assets,
referred to in Article 16j.1.1 letters (a) and (b), if the capital outlays growth index within three
quarters of the year preceding the tax year as compared with the similar period of previous
year exceeds 10%.
5a. (deleted)
5b. The capital outlays growth index shall be announced by the President of the Central
Statistical Office every quarter.
6. The deductible costs shall be write-offs with respect to wear and tear of fixed assets and
intangible assets (depreciation and amortization write-offs) made exclusively in accordance
with Article 16a-16m, taking into account Article 16.
7. In case of contracts for renting or leasing things or property rights and similar contracts, if
the renting or leasing party transferred the claims with respect to rents or fees arising from
such contracts to a third person, and those contracts between the parties do not expire, the
deductible costs of the renting or leasing party shall include the discount or consideration paid
to the third party.
8. The provisions of paragraph 1k, 1l, 1m and 1o shall be applied, as appropriate, to entities
listed in Annex No. 3 to this Act.
Art. 16 [Expenses not treated as costs]
1. The following expenses shall not be treated as deductible costs:
1) expenses on:
a) acquisition of land or the right of perpetual usufruct of land, with the exception of charges
for perpetual usufruct of land;
b) acquisition or internal manufacture of fixed assets and intangible assets, other than those
referred to in letter (a), including also fixed assets included in the acquired undertaking or
organized parts thereof.
c) improvements of fixed assets, which in accordance with Article 16g.13 increase the value
of fixed assets used as the base for calculating depreciation

- those expenses, updated in accordance with separate regulations, minus the sum total of
depreciation write-offs, referred to in Article 16h.1.1, shall be, however, the deductible costs,
subject to subparagraph 8a, in case of selling fixed or intangible assets, regardless of when
they have been incurred;

2) (deleted)
3) (deleted)
4) the part of depreciation with respect to the use of a passenger car, written off in accordance
with the principles laid down in Article 16a-16m, determined on the value of the car
exceeding the equivalent of EUR 20 000 converted into PLN at the average EUR rate
announced by the National Bank of Poland as at the date of giving the car for use;
5) the part of losses in fixed assets and intangible assets covered by the sum total of
depreciation write-offs, referred to in Article 16h.1.1;
6) losses incurred as a result of liquidation of not fully depreciated fixed assets, if those assets
ceased to be economically useful owing to the change of commercial activities;
7) (deleted)
8) expenses on receipt or acquisition of shares in a cooperative, shares or stocks in an
incorporated company and other securities, as well as expenses on acquisition of participation
titles or participation units in capital funds; however, such expenses shall be the deductible
costs when determining income from selling those shares, stocks and other securities,
including income with respect to redemption of securities by the issuer, as well as retirement
of participation titles or participation units in capital funds;
8a) (deleted)
8b) expenses related to acquisition of derivative financial instruments - until the rights under
those instruments are exercised, or the exercise of rights under those instruments is waived, or
they are sold - with the proviso that, in accordance with Article 16g.3 and 16g.4, those
expenses do not increase the initial value of fixed asset and intangible assets;
8c) expenses of a participant (shareholder) of the acquired or divided company for receipt or
acquisition of shares (stocks) in those companies in case of merger or division of capital
companies, subject to paragraph 10.1.6; those expenses shall be the deductible cost with
respect to revenues from selling shares (stocks) of the acquiring or newly established
company in the amount:
a) determined pursuant to Article 15.1k - if shares (stocks) in the acquired or divided
company were received in exchange for a contribution in kind;
b) determined pursuant to paragraph 8 - if shares (stocks) in the acquired or divided company
were acquired or received for cash;
c) of expenses for acquisition or receipt of shares (stocks) in the divided company, determined
in accordance with letter (a) or (b), in such proportion as the nominal value of that
participants cancelled shares (stocks) in the divided company to the value of nominal value
of shares (stocks) before the division; the remaining amount of those expenses shall be the
deductible cost with respect to selling shares (stocks) of the company divided by spin-off.
8d) expenses for acquisition or receipt of shares (stocks) transferred to another company in a
manner, referred to in Article 12.4d; those expenses shall be the deductible costs, determined
in accordance with subparagraph 8 and Article 15.1k, if the shares (stocks) received for them
are sold;
9) write-offs and contributions to various funds established by the taxpayer; however, the
following shall be treated as the deductible costs:
a) basic write-offs and contributions to those funds, if the duty or possibility to establish them
and charge to costs is laid down in separate acts;
b) write-offs and increases, which within the meaning of the regulations concerning internal
social benefits funds are charged to the employers operational costs, if the money equivalent
of those write-offs and increases have been paid to the account of the Fund;
c) (repealed)
10) expenses:
a) for repayment of loans (credits), with the exception of capitalized interest on those loans
(credits);
b) for repayment of other commitments, including those with respect to guarantees and
warranties granted;
c) retirement of capital having connection with the establishment (acquisition), expansion or
improvement of a source of revenues;
d) (deleted)
e) with respect to transfer of amounts repaid under credits (loans), covered by debt
securitization, to a securitization fund or an investment fund company establishing a
securitization fund by a bank;
11) accrued though unpaid or cancelled interest on commitments, including also loans
(credits);
12) interest, commissions and exchange rate differences on loans (credits) increasing the costs
of investment projects in the course of their implementation;
13) interest on own capital invested by the taxpayer in a source of revenues;
13a) interest on additional contributions brought in to a company in accordance with the
procedure and principles laid down in separate regulations, as well as interest on dividends
and other income from a share in profits of legal persons;
14) donations and contributions of any kind, with the exception of those made between the
companies making up a tax capital group, as well as contributions to the Polish Tourist
Organization;
15) income tax and payments from profits specified in separate regulations;
16) one-time compensations with respect to accidents at work and occupational diseases in the
amount specified by a competent minister and the additional insurance premium as a result of
worsened working conditions;
17) costs of enforcement related to non-performance of the obligations;
18) fines and financial penalties adjudged as a result of penal, penal fiscal, administrative and
petty offence proceedings, as well as interest on those fines and financial penalties;
19) penalties, charges and damages as well as interest thereon with respect to:
a) non-observance of environmental regulations;
b) non-performance of orders of competent regulatory and control authorities concerning
negligence with respect to work safety and hygiene;
19a) additional product fee, referred to in Article 17.2 of the Act of 11 May 2001 concerning
entrepreneurs duties in the area of certain waste management and on product fees and deposit
fees (Dz.U. No. 63, item 639 and of 2002 No. 113, item 984), with the proviso that the
deductible cost is the product fee, referred to in Article 12.2 of that Act;
20) debts written off as overdue;
21) interest for default with respect to budgetary dues and other dues, to which the provisions
of the Taxation Act are applicable;
22) contractual penalties and compensations for defects of goods delivered, work and services
performed and a delay in delivering defect-free goods or a delay in eliminating defects of
goods or work and services performed;
23) expenses on redemption of bonds, net of the discounted interest;
24) expenses related to real property in an event, referred to in Article 13.2.2.
25) debts written off as unrecoverable, with the exception of:
a) debts which had been previously, under Article 12.3, booked as revenues due and whose
unrecoverability has been documented in a manner described in paragraph 2;
b) extended by organizational entities authorized, under separate acts of law regulating the
principles of their functioning, to extend credits (loans) - credits (loans) due though
unrecoverable, net of the amount of unpaid interest and the equivalent of provisions for those
credits (loans), previously classified as the deductible costs;
c) losses incurred by a bank with respect to guarantees or warranties for repayment of credits
and loans, granted after 1 January 1997, calculated in accordance with subparagraph 25 (b);
26) provisions established to cover debts, the unrecoverability of which has been proved as
credible, with the exception of those provisions established to cover:
a) in organizational entities, referred to in subparagraph 25 (b):
- credits (loans) due though unrecoverable;

- credits (loans) classified as lost, extended to entrepreneurs implementing the restructuring


programme under separate acts;

b) guarantees or warranties for repayment of credits and loans, granted by a bank after 1
January 1997, due though unrecoverable;
c) guarantees or warranties for repayment of credits and loans, granted by a bank after 1
January 1997, classified as lost, extended to entrepreneurs implementing the restructuring
programme under separate acts;
d) 25% of credits and loans classified as doubtful and 25% of guarantees or warranties for
repayment of credits and loans classified as doubtful - granted by a bank after 1 January 1997;
e) 50% of credits and loans classified as doubtful and 50% of guarantees or warranties for
repayment of credits and loans classified as doubtful - extended by a bank to entrepreneurs
implementing the restructuring programme under separate acts;
26a) revaluation write-offs, with the proviso that the deductible costs are revaluation write-
offs on receivables, described in the Accounting Act, with respect to that part of receivables
which, pursuant to Article 12.3, had been previously booked as revenues due and the
unrecoverability of which has been proved as credible under paragraph 2a.1;
27) provisions, other than those mentioned in subparagraph 26, if the duty to establish and
charge them to costs does not arise from separate acts; however, provisions established in
accordance with the Accounting Act, other than those specified in this Act as the deductible
costs, shall not be treated as such;
28) the part of entertainment and advertising costs exceeding 0,25% of revenues, unless
advertising is carried out in mass media or otherwise publicly;
29) write-offs to the land reclamation fund exceeding the amount specified by the taxpayer for
a given year in the post-exploitation land reclamation plan, adjusted by the amounts of that
found remaining as at the beginning of the tax year;
30) expenses incurred on behalf of employees with respect to their use of cars for taxpayers
business purposes:
a) in order to go on a business trip (long-distance trips) - in the amount exceeding the amount
calculated at the rates per one kilometre of mileage;
b) for local trips - in the amount exceeding the amount of a monthly allowance or in the
amount exceeding the rates per one kilometre of mileage

- specified in separate regulations issued by a competent minister;

31) (deleted)
32) additional amounts, which in accordance with price regulations should be paid to the state
budget;
33) additional amounts of annual fees for failing to build up or otherwise develop land within
certain period of time, specified in the regulations on real property management;
34) (deleted)
35) (deleted)
36) payments, referred to in Article 21.1 and in Article 23 of the Act of 27 August 1997 on
Occupational and Social Rehabilitation and on Employment of Handicapped People (Dz.U.
No. 123, item 776 and No. 160, item 1082, of 1998 No. 99, item 628, No. 106, item 668, No.
137, item 887, No. 156, item 1019 and No. 162, item 1118 and 1126, of 1999 No. 49, item
486, No. 90, item 1001, No. 95, item 1101 and No. 111, item 1280 and of 2000 No. 48, item
550);
37) contributions to organizations the membership of which is not mandatory for the taxpayer,
with the exception of:
a) contributions of cooperative organization to audit associations and the National
Cooperative Council, with the proviso that the upper limit of the contribution shall be set by
the minister competent for public finance, by way of an ordinance, having consulted the
National Cooperative Council;
b) (deleted)
c) contributions to organizations affiliating entrepreneurs and employers operating under
separate acts - up to the total amount not exceeding in the tax year the amount corresponding
to 0,15% the amount of remunerations paid in the preceding tax year, constituting a base for
assessment of social security contributions;
38) expenses related to making unilateral performances on behalf of the participants
(shareholders) or members of a cooperative who are not employees within the meaning of
separate regulations, with the proviso that the part of expenses made on behalf of members of
farming cooperatives and other cooperatives involved in agricultural production relating to
activities taxable with income tax shall be treated as the deductible costs;
38a) expenses on behalf of persons sitting on supervisory boards, audit committees or
governing bodies of legal persons, with the exception of remunerations paid for the
performance of those functions;
39) losses from selling debts, unless the debt had been previously booked, pursuant to Article
12.3, as income due;
40) social security and Labour Fund contributions, and contributions to other targeted funds
established under separate acts - with respect to awards and bonuses paid in cash or securities
from income after taxation with income tax;
41) incurred costs of discontinued investment projects;
42) (deleted)
43) remitted bank credits (loans), if remittal of those debts is not related to:
a) bank arrangement proceedings within the meaning of regulations concerning financial
restructuring of companies and banks; or
b) bankruptcy proceedings involving the possibility to enter into an arrangement within the
meaning of the bankruptcy and restructuring law; or
c) implementation of a restructuring programme pursuant to separate acts of law;
44) remitted debts, with the exception of those which had been previously, under Article 12.3,
booked as revenues due;
45) employers expenses on social activities, referred to in the regulations concerning the
company social benefits fund; however, holiday benefits paid in accordance with the
regulations concerning the company social benefit fund shall be treated as deductible costs;
46) goods and services tax, with the proviso that the following shall be treated as deductible
costs:
a) input tax:

- if the taxpayer is exempt from the goods and services tax or purchased goods and services in
order to produce or resell goods or perform services exempt from goods and services tax;

- that part of the goods and services tax, as to which in accordance with the goods and
services tax regulations the taxpayer is not entitled to reduce the amount or to the refund of
the goods and services tax difference - if input goods and services tax does not increase the
value of a fixed asset or an intangible asset;

b) output tax in case of:


- import of services and intracommunity acquisition of goods, if it does not constitute input
tax within the meaning of the goods and services tax regulations; however, the part of output
tax exceeding the amount of tax on acquisition of those goods and services, which might
constitute input tax within the meaning of the goods and services tax regulations shall not be
treated as deductible cost;

- transfer or use by the taxpayer of goods or performance of services for entertainment and
advertising purposes, calculated in accordance with separate regulations;

c) the amount of goods and services tax not included in the initial value of fixed assets and
intangible assets, depreciable in accordance with Article 16a-16m, or concerning things or
rights other than fixed assets or intangible assets subject to those depreciation - the part
thereof which had been adjusted to reduce tax deducted in accordance with Article 91 of the
Goods and Services Tax Act;
47) losses incurred as a result of excessive wastage or culpable shortage of excise goods and
excise duty on that wastage or shortage;
48) write offs with respect to the use of fixed assets and intangible assets made, in accordance
with the principles laid down in Article 16a-16m, from the part of their value corresponding
with the expenses incurred for acquisition or own production of those assets or intangible
assets, deducted from the taxation base or refunded to the taxpayer in any form;
49) passenger car insurance premiums in the amount exceeding their part set in the same
proportion that the equivalent of EUR 20 000, converted into Polish zlotys at the selling rate
of exchange of EUR announced by the National Bank of Poland as at the date of conclusion
of the insurance contract, constitutes in relation to the cars value accepted for insurance;
50) losses incurred as a result of the loss or liquidation of cars and the costs of their post-
accident repairs, if the cars were not covered by non-mandatory insurance;
51) the part of expenses, subject to subparagraph 30, with respect to the business use of
passenger cars not entered in the taxpayers inventory of fixed assets, exceeding the amount
resulting from multiplying the number of kilometres actually ran by the vehicle by the rate per
one kilometre of mileage, referred to in separate regulations issued by a competent minister;
the taxpayer shall be obliged to keep an inventory of vehicles mileage;
52) expenses incurred on purchasing taxpayers gradually wearing out tangible assets, not
classified as fixed assets - in case of stating that those assets are not used for the needs of
commercial activities conducted by the taxpayer, but they serve personal purposes of
employees or other persons, or without justification are found outside of the taxpayers
premises;
53) additional payments, referred to in Article 12.4.11, and their refunds;
54) sanction fees, which in accordance with separate regulations are payable to the state
budget or budgets of local government units;
54a) aadditional fee imposed by the Social Security Company under the regulations
pertaining to the social security system;
55) the part of maintenance costs of company social facilities covered from the internal social
benefits fund;
56) losses (costs) incurred as a result of prepayments (advances, down payments) lost in
connection with non-performance of a contract;
57) payments, benefits and other dues as specified in Article 12.1 and 6, Article 13.2 and
13.4-13.9 and in Article 18 of the Personal Income Tax Act of 26 July 1991 (Dz. U. of 2000
No. 14, item 176, with later amendments), as well as social security cash benefits payable by
the employer, which have not been paid, performed or made available;
57a) the part of unpaid social security (ZUS) contributions, subject to subparagraph 40,
specified in the Act of 13 October 1998 on the Social Security System, which is financed by
the contributions withholding agent;
58) expenses and costs financed directly from income (revenues), referred to in Articles
17.1.14a, 23 and 24, or with funds, referred to in Article 33.4 of the Act of 24 April 2003 on
Public Benefit and Voluntary Activities (Dz.U. No. 96, item 873, with later amendments);
59) premiums paid by the employer with respect to insurance contracts concluded or renewed
on behalf of employees, with the exception of contracts concerning category 1, 3 and 5 of
Class I and category 1 and 2 of Class II risks listed in the Annex to the Insurance Act of 22
May 2003 (Dz.U. No. 124, item 1151) if the beneficiary is not the employer and within 5
years from the end of the calendar year when the insurance contract was concluded or
renewed it excludes:
a) payment of the surrender value;
b) possibility of assuming obligations secured by rights under the contract;
c) payment for survival until the age specified in the contract;
60) interest on loans (credits) extended to a company by its participant (shareholders) holding
not less than 25% of that companys shares (stocks) or participants (shareholders) together
holding not less than 25% of that companys shares (stocks), if the aggregate amount of the
companys debt to that companys participants (shareholders) holding not less than 25% of
that companys shares (stocks) and to other entities holding not less than a 25% interest in the
capital of such participant (shareholder) reaches three times the initial capital of the company
- the part thereof in which the loan (credit) exceeds that value of the debt, determined as a the
date of payment of interest; those provisions shall apply, as appropriate, to cooperatives,
cooperative members and the share fund of such cooperative;
61) interest on loans (credits) extended by a to another company, if in both companies the
same participant (shareholders) holds not less than 25% of shares (stocks), and the value of
debt of the borrowing company to that companys participants (shareholders) holding not less
than 25% of that companys shares (stocks) and to other entities holding not less than a 25%
interest in the capital of such participants (shareholders) and to the lending company reaches
three times the initial capital of the company - the part thereof in which the loan (credit)
exceeds that value of the debt, determined as a the date of payment of interest; those
provisions shall apply, as appropriate, to cooperatives, cooperative members and the share
fund of such cooperatives;
62) (repealed)
63) depreciation written off the initial value of fixed assets and intangible assets:
a) acquired free of charge, if:

- that acquisition does not generate revenues as a result of free-of-charge receipt of things or
rights; or

- income generate therefrom is exempt from income tax; or

- the acquisition generates income, with respect to which taxation has been waived under
separate regulations;

b) if before 1 January 1995 they were acquired but not included in fixed assets or intangible
assets;
c) given away for use free of charge, with the exception of real property - for the months,
during which these assets were given away for use free of charge;
d) acquired in the form of a contribution in kind, on that part of their value which has not
been appropriated for establishment or increase of the initial capital of a capital company;
64) depreciation written off from the initial value of intangible assets brought into the
company in the form of the contribution in kind, being equivalent to information obtained
with respect to expertise in the area of industry, trade, science or organization (know-how);
65) costs connected with financing health care services by the employer on behalf of
employees, with the exception of the costs incurred for health care services, which the
employer is obliged to pay under the provisions of the Labour Code and other acts.
1a. (deleted)
1b. Whenever in this Act there is a mention of derivatives, it shall mean the property rights,
whose price depends directly or indirectly on the prices of commodities, foreign currencies,
Polish currency, foreign exchange gold, foreign exchange platinum or securities, or on interest
rates or indices, in particular options and futures;
2. The debts, referred to in paragraph 1.25, shall be the debts whose unrecoverability has been
documented with:
1) a decision of unrecoverability, accepted by the creditor as corresponding with the facts,
issued by a competent enforcement authority; or
2) court decision:
a) dismissing the petition in bankruptcy involving liquidation of all assets where the assets of
the insolvent debtor are not sufficient to cover the costs of the proceedings; or
b) discontinuing the bankruptcy proceedings involving liquidation of all assets in a situation
referred to in letter (a); or
c) terminating the bankruptcy proceedings involving liquidation of all assets; or
3) a report compiled by the taxpayer stating that the expected costs of the judiciary process
and enforcement connected with vindication of claim would be equal to or in excess of that
amount.
2a. Unrecoverability of a debt shall be deemed as rendered credible:
1) in the event, referred to in paragraph 1.26a, in particular, if:
a) the debtor died, has been crossed out from the commercial register, put in liquidation or
declared bankrupt involving liquidation of assets; or
b) bankruptcy proceedings with a possibility of concluding an arrangement within the
meaning of the bankruptcy and rehabilitation regulations have been initiated or arrangement
proceeds within the meaning of regulations concerning financial restructuring of companies
and banks have been initiated at debtors request; or
c) the claim has been adjudged by a valid court ruling and referred for enforcement; or
d) the claim has been questioned by the debtor in court;
2) in the event, referred to in paragraph 1.26 letter (a) first indent and 1.26 letter (b), if:
a) the requirement laid down in subparagraph 1 letter (a) or letter (b) has been met; or
b) the delay in repayment of the principal of the credit (loan) or interest exceeds 6 months,
and moreover:
- the requirement laid down in subparagraph 1 letter (d) has been met; or
- the claim has been referred for enforcement; or
- the whereabouts of the debtor are unknown and his assets have not been disclosed despite
creditors efforts aimed at determining those whereabouts and assets.
2b. Claims covered by provisions for credits (loans) and guarantees (warranties) for
repayment of credits and loans, referred to in paragraph 1.26, granted by a bank, shall be
reduced, subject to paragraph 2c, by the value of:
1) guarantees or warranties of the State Treasury, the National Bank of Poland or the Bank
Guarantee Fund;
2) guarantees or warranties of the central bank or the government of an OECD member state;
3) guarantees or warranties of a bank of good standing whose seat is located in an OECD
member state;
4) guarantees or warranties of a state legal person, excluding banks and insurance companies,
authorized by separate regulations to extend them under implementation of state assignments
entrusted to it, if the sources of financing potential commitments have been specified in the
state budget;
5) transfer of claims under a stand-by letter of credit opened or confirmed by a bank of good
standing whose seat is located in an OECD member state;
6) export insurance contract or insurance guarantee of Korporacja Ubezpiecze Kredytw
Eksportowych S.A., concluded or granted pursuant to the regulations concerning export
insurance guaranteed by the State Treasury, for a specified credit contract or off-balance sheet
commitment - up to 100% of the sum insured or amount of the guarantee, if the need to
establish a provision results from the events covered by that insurance or guarantee;
7) guarantees or warranties of Bank Gospodarstwa Krajowego from the National Credit
Guarantee Fund granted pursuant to the regulations concerning warrantees and guarantees
granted by the State Treasury and certain legal persons;
8) guarantees or warranties of a of local government entity of the Republic of Poland (gmina,
powiat or wojewdztwo) of good standing, with the provision that the deducted amount of the
security should be provided for in a resolution of a competent body of the local government
entity concerning determination of the maximum amount of loans, guarantees and warranties
granted by the board in the tax year;
9) depositing a specified amount in PLN or another convertible currency in an account of the
bank, which has agreed to return that amount upon the receipt of debt repayment including
interest due and the fee, up to that amount, with the provision that conversion into PLN shall
be done at the average rate of exchange as set by the National Bank of Poland as at the date of
the classification;
10) pledge by register on the debt under a deposit account in a bank:
a) which has a credit exposure; or
b) of good standing, whose seat is located in an OECD member state

- together with a statement that the deposit has been blocked and an authorization to withdraw
funds from the deposit account;

11) transfer by the debtor to the bank, until repayment of the debt including the interest due
and the fee, of the ownership title
a) securities issued by the State Treasury or the National Bank of Poland;
b) securities issued by central banks or governments of OECD member states;
c) bank securities issued by other banks;

- at their fair value;

12) mortgage upon:


a) real property;
b) perpetual usufruct;
c) cooperative ownership right to an apartment;
d) cooperative ownership right to commercial premises;
e) right to a single-family house in a housing cooperative;
f) right to an apartment in a house built by a housing cooperative in order to transfer its
ownership to a member;
13) guarantees or warranties of an entity of good standing, if the total amount of guarantees
and warranties granted by the guarantor (warrantor) to a single borrower is less than 15% of
net assets of that guarantor (warrantor), minus outstanding contributions to the core capital
(funds) of joint stock companies and cooperatives;
14) transfer by the debtor to the bank, until repayment of the debt including the interest due
and the fee, of the ownership title to a movable, under the conditions specified by a party in
an agreement;
15) transfer by the debtor to the bank, until repayment of the debt including the interest due
and the fee, of the ownership title to securities, other than those referred to in subparagraph
11, subject to public trading in OECD member states;
16) maritime hypothecation of a sea-going vessel entered into a register of shipping;
17) pledge on an aircraft entered into the state register of aircraft;
18) pledge by register on:
a) rights under securities, referred to in subparagraph 11, at their fair value;
b) rights under securities, referred to in subparagraph 15;
19) pledge by register on a movable;
20) transfer of funds from the deposit account opened in a bank other than the bank holding
the claim or off balance sheet commitment, together with a statement that the deposit has been
blocked and an authorization to withdraw funds from the deposit account;
21) sponsorship declaration of an entity of good standing, containing an obligation of the
issuer to undertake measures with respect to the debtor, aimed at maintaining punctual service
of banks credit exposure and maintaining good standing of the debtor, providing that:
a) the contents of the declaration ensure the possibility of asserting claims against the issuer in
case of the need to establish a provision;
b) the bank has a legal opinion concerning effectiveness of asserting potential claims against
the issuer of the declaration;
c) the commitment of the issuer of the declaration has been entered in the issuers books;
d) the total amount of sponsorship declarations, guarantees and warrantees granted by the
issuer to a single borrower is less than 15% of net assets of that issuer, minus outstanding
contributions to the core capital (funds) of joint stock companies and cooperatives;
2c. The provisions of paragraph 2b shall apply to the extent in which the bank has reduced the
basis for establishment of provisions classified as banks costs, pursuant to the accounting
regulations, by the amount of security, referred to in those regulations.
2d. Credit exposures, referred to in paragraph 2.10(a) and 2.21, shall mean:
a) receivables, with the exception of interest, including capitalized interest;
b) off balance sheet commitments granted of a financial and guarantee nature.
3. The provisions of paragraph 1.26 shall apply to banking risk provisions, established in
accordance with the accounting regulations.
3a. Whenever a passenger car is mentioned in paragraph 1, this shall mean any car that has
not been type approved by the manufacturer or importer as requested for cars other than
passenger cars and whose maximum authorized payload is less than 500 kgs.
3b. Paragraph 1.51 shall not apply to passenger cars used under a lease agreement, referred to
in Article 17a.1.
3c. The provisions of paragraph 1.26 shall not apply in case of provisions for covering credits
(loans), guarantees (warranties), referred to in paragraph 1.26, which have been extended in
vilotaion of the law, providing that violation has been confirmed by a final court judgment.
3d. The provision of Article 16.1.43(c) shall apply to banks participating in implementation of
a restructuring programme pursuant to separate acts of law, providing the equivalent of 100%
of the remitted debt has been appropriated and spent on extending credits (loans) to
entrepreneurs covered by that programme.
3e. The provision of paragraph 2a.2 shall not be applied by banks participating in
implementation of a restructuring programme pursuant to separate acts of law, with respect to
provision for debts classified as lost loans (credits) and debts with respect to guarantees or
warranties for repayment of credits and loans - granted by a bank.
3f. Should loans (credits) and guarantees (warranties) for repayment of credits and loans
granted by a bank, subject to paragraph 1.26 letter (a) second indent and 1.26 letter (c), be
classified as lost, and whose unrecoverability has not been rendered credible, the deductible
costs shall be the amount of the provisions determined in accordance with paragraph 1.26
letter (d).
4. Whenever the rate per one kilometre of vehicles mileage is mentioned in paragraph 1, it
means the rate set for passenger cars, taking into account, as appropriate, their engine
capacity.
5. Vehicles mileage, referred to in paragraph 1.30 and 1.51, should be, excluding cash
allowance, documented in the vehicles mileage records certified by the taxpayer at the end of
each month. The vehicles mileage record should provide at least the following data: surname,
first name and address of vehicle user, registration number and engine capacity of the vehicle,
serial number of entry, date and purpose of the trip, description of route (place of departure -
destination), actual mileage, rate per one kilometre of mileage, the amount resulting from
multiplication of actual mileage and the rate per one kilometre, taxpayers (employers)
signature and their data. In case of an absence of such records, expenses with respect to the
use of cars shall not be treated as the deductible costs.
6. The percentage of shares (stocks), referred to in paragraph 1.60 and 1.61, held by
participants (shareholders) in a company shall be determined on the basis of the number of
votes those participants (shareholders) are entitled to in connection with their shareholdings.
7. The value, referred to in paragraph 1.60 and 1.61, of the share fund in a cooperative or the
initial fund of a company shall be determined without taking into account that part of that
fund or capital which has not been actually transferred to that fund or capital, or has been
covered with loans (credits) and interest on those loans (credits), to which members of a
cooperative or participants (shareholders) of a company are entitled, as well as intangible
assets, which are not depreciated in accordance with Article 16a - to 16m.
7a. (repealed)
7b. A loan, referred to in paragraph 1.60 and 1.61 and in paragraph 7, shall mean any
agreement in which the lender agrees to transfer to the borrower a specified amount of money,
and the borrower agrees to return the same amount of money; a loan shall also mean issue of
debt securities or deposit.
7c. The provision of paragraph 1.46(c) shall apply, as appropriate, should the right to deduct
input tax from output tax, referred to in Article 91.7 of the Goods and Services Tax Act,
change.
7d. The provision of paragraph 1.57a shall apply, as appropriate, subject to paragraph 1.40, to
contributions to the Labour Fund and the Guaranteed Employee Benefits Fund.
8. The minister competent for public finance shall specify, by way of an ordinance, the
maximum amount of contributions paid by entrepreneurs in favour of the Polish Tourism
Organization, treated as a deductible cost.
9. The provisions of paragraph 1.8c and 1.8d shall be applied, as appropriate, to entities listed
in Annex No. 3 to this Act.
Art. 16a [Fixed assets]
1. The following assets, owned or co-owned by the taxpayer, purchased or produced by the
taxpayer, complete and usable as at the date of acceptance for use, shall be depreciated,
subject to Article 16c:
1) structures, buildings and premises constituting a separate property;
2) machines, equipment and means of transport;
3) other objects
- with the expected useful life of more than one year, used by the taxpayer for the purposes
linked with the taxpayers commercial activities and handed over for use under a renting or
lease agreement, or an agreement referred to in Article 17a.1, called fixed assets.
2. Also the following shall be depreciated, subject to Article 16c, regardless of their expected
useful life:
1) investments in third party fixed assets accepted for use, hereinafter called "investments in
third party fixed assets";
2) buildings and structures erected on third party land;
3) assets, referred to in paragraph 1, not owned or co-owned by the taxpayer, used by the
taxpayer for the purposes linked with the taxpayers commercial activities under an agreement
referred to in Article 17a.1, concluded with the owner or co-owners of those assets - if in
accordance with the provisions of Chapter 4a depreciation is written off by the user
- also called fixed assets;
4) means of sea transport under construction, classified in the Polish Classification of
Products and Services (PKWiU) in category 35.11"ships", included in branch 1051-1053 of
the Systematic Schedule of Products (SWW) of the Central Statistical Office (Dz.U. of 1997
No. 42, item 264 and of 1999 No. 92, item 1045).
Art. 16b [Intangible assets]
1. The following intangible assets, acquired and fit for commercial use as at the date of
acceptance for use, shall be depreciated, subject to Article 16c:
1) the cooperative ownership right to an apartment;
2) the cooperative ownership right to commercial premises;
3) the right to a single-family house in a housing cooperative;
4) copyright or related proprietary rights;
5) licences;
6) rights to: inventions, patents, trademarks, designs;
7) the value of information relating to knowledge in the area of industry, commerce, science
or organization (know-how)
- with the expected useful life of more than one year, used by the taxpayer for the purposes
linked with the taxpayers commercial activities and handed over for use under a licencing
(sublicensing), renting or lease agreement, or an agreement referred to in Article 17a.1, called
intangible assets.
2. Also the following shall be depreciated, subject to Article 16c, regardless of their expected
useful life:
1) (deleted)
2) goodwill, if it was generated as a result of acquisition of an undertaking or an organized
part thereof by way of:
a) purchase;
b) acceptance for use against a consideration, and depreciation, in accordance with the
provisions of Chapter 4a, is written off by the user;
c) bringing into a company under the commercialization and privatization regulations;
3) costs of development work ended with a positive outcome, which may be used for the
purposes of commercial activities of the taxpayer, if:
a) the product or production technology are strictly defined, and the related costs of
development work are assessed in a credible manner; and
b) technical suitability of the product or technology was properly documented by the taxpayer
and on that basis the taxpayer made the decision to manufacture those products or apply the
technology; and
c) if it follows from the development work documentation that the costs of development work
will be covered by expected revenues from the sale of those products or application of the
technology;
4) assets referred to in paragraph 1, not owned or co-owned by the taxpayer, used by the
taxpayer for the purposes linked with the activities under an agreement referred to in Article
17a.1, concluded with the owner or co-owners, or parties authorized to use those assets - if in
accordance with the provisions of Chapter 4a depreciation is written off by the user
- also called intangible assets.
Art. 16c [Not depreciated] The following shall not be depreciated:
1) land and the right to perpetual usufruct of land;
2) buildings, premises, structures and installations included in cooperative housing stock or
serving social and educational activities conducted by housing cooperatives;
3) works of art and museum exhibits;
4) goodwill, if it was generated in a manner other than the one described in Article 16b.2.2;
5) assets, which are not used as a result of ceasing of the activities in which those assets were
used; in that case those assets shall not be depreciated from the month following the month, in
which those activities were ceased
- called, as appropriate, fixed assets or intangible assets.
Art. 16d [Assets of the value of up to PLN 3500]
1. Taxpayers may not write off depreciation on assets, referred to in Article 16a and 16b,
whose initial value, determined in accordance with Article 16g, is less than PLN 3500; the
expenses incurred for their acquisition shall then constitute deductible costs in the month of
their commissioning.
2. Assets, referred to in Article 16a-16c, excluding assets referred to in paragraph 9, shall be
entered in the record of fixed assets and intangible assets in accordance with Article 9.1, at the
lastest in the month of their commissioning. Any later date of entering shall be considered to
be the disclosure of a fixed asset, referred to in Article 16h.1.4.
Art. 16e [Assets not classified as fixed assets]
1. If taxpayers acquire or generate themselves assets referred to in Article 16a.1 and Article
16b.1, whose initial value exceeds PLN 3500, and owing to their expected useful life equal to
or shorter than one year do not classify them as fixed assets or intangible assets, and the actual
useful life exceeds one year - taxpayers shall be obliged, in the first month following the
month, in which that period of one year elapsed:
1) classify those assets as fixed assets or intangible assets, entering them in the records at the
acquisition price or manufacturing cost;
2) reduce deductible costs by the difference between the acquisition price or manufacturing
cost and the amount of depreciation to be written off for the period of their hitherto use,
calculated for fixed assets with the application of depreciation rates laid down in the Schedule
attached hereto as Annex No. 1, referred to as "Depreciation Rates Schedule", and for
intangible assets - with the application of principles laid down in Article 16m;
3) apply depreciation rates, referred to in subparagraph 2, throughout the period of writing off
depreciation;
4) pay, by the 20-th day of that month, to the fiscal office the amount of interest accrued from
the date of classifying expenses for acquisition of generation of assets as deductible costs until
the date, on which their useful life exceeded one year, and to show the amount of interest
accrued in tax returns, referred to in Article 25.1 and Article 27.1; interest accrued on the
difference, referred to in subparagraph 2, shall amount to 0,1% for each day.
2. The provisions of paragraph 1 shall apply, as appropriate, in case of classifying expenses
for acquisition or manufacture of assets whose initial value exceeds PLN 3500 as the
deductible costs, and then classifying those assets as fixed assets or intangible assets within
one year from the date of their acquisition or manufacture; in that case interest shall accrue
until the date of classifying them as fixed assets or intangible assets.
3. If the difference, referred to in paragraph 1.2, is higher than the costs of a given month, the
unaccounted for excess of costs shall be deducted from costs in the following months.
Art. 16f [Basis for depreciation write-offs]
1. Taxpayers, with the exception of those, who as a result to declared bankruptcy involving
liquidation of assets do not run commercial activities, make depreciation write-offs on the
initial value of fixed assets and intangible assets, referred to in Article 16a.1 and 16a.2.1-
16a.3 and in Article 16b.
2. Taxpayers who are shipowners, with the exception of those, as a result to declared
bankruptcy involving liquidation of assets do not run commercial activities, may write off
depreciation on ordered sea-going vessels under construction, referred to in Article 16a.2.4.
3. Depreciation shall be written off in accordance with Article 16h-16m, when the initial
value of a fixed asset or intangible assets at the date of acceptance for use is higher than PLN
3500. When the initial value is equal to or lower than PLN 3500, taxpayers may write off
depreciation, subject to Article 16d.1, in accordance with Article 16h-16m or on a one-off
basis in the month of commissioning of that fixed asset or intangible asset, or in the following
month.
4. Depreciation shall be written off on fixed assets and intangible assets, the ownership of
which was transferred in order to secure a claim, including a loan or credit, by the hitherto
owner, including a borrower.
Art. 16g [Initial value]
1. The initial value of fixed assets and intangible assets, taking into account paragraphs 2-14,
shall be:
1) in case of acquisition by way of purchase - their acquisition price;
1a) in case of acquisition against partial consideration - their acquisition price plus the value
of revenues, referred to in Article 12.5a;
2) in case of their manufacture on ones own - the cost of their manufacture;
3) in case of acquisition by way of inheritance, gift or otherwise in a gratuitous manner - the
market value as at the date of acquisition, unless that value is specified in the gift agreement
or the agreement on gratuitous transfer at a lower level;
4) in case of acquisition in the form of the contribution in kind brought into a private
partnership or a personal commercial company - the value of individual fixed assets and
intangible assets set by the participants as at the date of bringing in the contribution or share,
however not exceeding their market value.
2. The initial value of goodwill shall be the positive difference between the acquisition price
of an undertaking or an organized part thereof, set in accordance with paragraphs 3 and 5, or
the nominal value of shares or stocks issued in exchange for a contribution in kind, and the
market value of assets of an undertaking or an organized part thereof purchased, accepted for
use against a consideration or brought into a company, as of, as appropriate, the date of
purchase, acceptance for use against a consideration or bringing into a company.
3. The acquisition price shall be the amount due to the seller, plus the purchase related costs
accrued until the date of turning over the fixed asset or the intangible asset for use, and in
particular the costs of transport, loading and unloading, insurance in transit, assembly,
installation and starting of computer programmes and systems, notarial fees, stamp duties and
other charges, interest, commissions, and minus the goods and services tax, with the exception
of case, where in accordance with separate regulations the goods and services tax is not the
input tax or the taxpayer is not entitled to deduct input tax from the amount output tax or to
the tax refund within the meaning of the Goods and Services Tax Act. In case of import the
acquisition price shall include customs and excise duty on import of assets.
4. The cost of manufacture shall be the value, at the acquisition price, of the following used
for the manufacture of fixed assets: tangible assets and external services used, costs of
remunerations for work and related costs, as well as other costs attributable to the value of the
fixed assets manufactured. The cost of manufacture shall not include: general management
costs, selling costs, as well as other operating costs and financial costs, in particular interest
on loans (credits) and commissions, excluding interest and commissions accrued until the date
of the commissioning of the fixed asset.
5. The acquisition price, referred to in paragraph 3, and the cost of manufacture, referred to in
paragraph 4, shall be adjusted for foreign exchange gains/losses accrued until the date of
commissioning of the fixed asset or the intangible asset.
6. The initial value of assets acquired in the manner specified in paragraph 1.3 and 1.4,
acquiring assembly, shall be increased by the expenses incurred for their assembly.
7. The initial value of an investment in third party fixed assets, as well as buildings and
structures erected on third party land shall be determined applying, as appropriate, paragraphs
3-5.
8. In case the asset is co-owned by the taxpayer, the initial value of that asset shall be
determined with respect to such part of its value, which corresponds to the taxpayers share in
the ownership of that asset; Article 5.1 shall apply, as appropriate.
9. In case of a transformation, as well as consolidation or division of entities, subject to
paragraph 19, pursuant to separate regulations - the initial value of fixed assets and intangible
assets shall be determined in the amount of the initial value referred to in the inventory
(record) of fixed assets and intangible assets, referred to in Article 9.1, of the transformed,
divided or consolidated entity.
10. In case of acquisition by way of purchase or acceptance for use against a consideration of
an undertaking or an organized part thereof, the total initial of acquired fixed assets and
intangible assets shall be:
1) the sum total of their market values in case of the positive goodwill determined in
accordance with paragraph 2;
2) the difference between the acquisition price of an undertaking or an organized part thereof,
determined in accordance with paragraphs 3 and 5, and the value of assets that are neither
fixed assets or intangible assets, in case of absence of positive goodwill.
11. In case of acquisition of an undertaking or an organized part thereof by way of inheritance
or gift, the total initial value of acquired fixed assets and intangible assets is the sum total of
their market values, though not higher than the difference between the value of revenues,
referred to in Article 12.5, included in the taxable base for the tax year in which the
undertaking or an organized part thereof was acquired, and the incremental value of
inheritors or beneficiarys assets that are neither fixed assets or intangible assets.
12. The provisions of Article 14 shall apply, as appropriate, to determination of the initial
value of individual fixed assets and intangible assets in accordance with paragraph 1.3 and 1.4
and paragraphs 2, 10 and 11.
13. If fixed assets were improved as a result of alteration, expansion, reconstruction,
adaptation or modernization, the initial value of those assets, determined in accordance with
paragraphs 1 and 3-11, shall be increased by the sum total of expenses on their improvement,
including also expenses for acquiring components or peripherals, whose unit acquisition price
is larger than PLN 3500. Fixed assets shall be considered improved, when the sum total of
expenses incurred on their alteration, expansion, reconstruction, adaptation or modernization
in a given tax year is larger than PLN 3500 and those expenses result in the growth of the
utility value over the value as at the date of acceptance of fixed assets for use, measured in
particular by their useful life, production capacity, quality of products generated with the
improved fixed assets and costs of their operation.
14. The initial value of property rights, including licences and copyrights, shall be the
acquisition price of those rights; if the consideration (royalties) arising from the licence
agreement or the agreement concerning transfer of other property rights depends on the
amount of revenues under the licenses or rights obtained by the licensee or transferee, that
part of the consideration shall be excluded from the determination of the initial value of
property rights, including licenses.
15. (deleted)
16. In case of the permanent detachment from a given fixed asset of a component or
peripheral, the initial value of that asset shall be reduced, as from the month following the
detachment, by the difference between the acquisition price (manufacturing cost) of the
detached part and the sum total of that parts depreciation write-offs calculated by the same
depreciation method and depreciation rate that has been used for calculating depreciation
write-offs on that fixed asset.
17. If the detached part is later attached to another fixed asset, the initial value that other
assets shall be increased in the month of attachment by the difference, referred to in paragraph
16.
18. The provision of paragraph 9 shall apply, if the separate regulations provide that the entity
formed as a result of the transformation, division or consolidation, or the existing entity to
which a part of the assets of the divided entity have been transferred as a result of spin-off,
shall assume all rights and obligations of the transformed, consolidated or divided entity.
19. The provisions of paragraph 9 shall not apply to the division of entities, if the assets
acquired as a result of the division, and in case of division by spin-off also the assets
remaining in the divided entity, do not constitute an organized part of an undertaking. In such
case, the provisions of paragraph 1.4 or paragraph 10 shall apply, as appropriate, to valuation
of the acquired assets.
Art. 16h [Straight line method]
1. Depreciation shall be written off:
1) on the initial value of fixed assets or intangible assets, subject to Article 16k, beginning
with the first month following the month, in which that fixed asset or intangible assets was
entered into the inventory (record), subject to Article 16e, until the end of the month, in which
the sum total of depreciation write-offs is balanced with their initial value or in which they
were put to liquidation, sold or they were found depleted; the sum total of depreciation write-
offs shall include also write-off which, in accordance with Article 16.1, are not considered to
be the deductible costs;
2) on sea-going vessels under construction, referred to in Article 16a.2.4, ordered by the
shipowner, beginning with the first month following the month, in which the ship-owner
incurred expenses (including payment of advances) on the construction of vessels in the
amount of at least 10% of the contract value separately for each vessel; the contract value,
referred to in this subparagraph, shall be determined as at the date of conclusion of the
contract for the construction a a given vessel;
3) on seasonally used fixed assets and intangible assets within the period of their use; in that
case the amount of a monthly write-off shall be determined by dividing the annual amount of
depreciation write-offs by the number of months in the season or by 12 months in a year;
4) on disclosed fixed assets so far not included in the inventory - beginning with the month
following the month, in which those assets were entered into the inventory.
2. Taxpayers, subject to Article 161 and 16, shall choose one of the depreciation methods laid
down in Article 16i-16k for individual fixed assets prior to starting their depreciation; the
selected method shall continue to be applied until a given fixed assets is fully depreciated.
3. Entities, referred to in Article 16g.9, set up as a result of a transformation, division, subject
to paragraph 5, or consolidation of entities, and entities which acquired all or part of another
entity as a result of those events, shall write off depreciation taking into account the amounts
written off so far and continue to apply the depreciation method adopted by the transformed,
divided or consolidated entity, account being taken of Article 16i.2-16i.7.
4. Taxpayers may write off depreciation in equal monthly instalments or equal quarterly
instalments or on a one-off basis at the end of the tax year, account being taken of Article 16i.
The sum total of depreciation written off on fixed assets and intangible assets in the first tax
year, in which those assets were entered into the inventory, may not exceed the value of
depreciation for the period from their entry to the inventory (record) until the end of that tax
year.
5. The provision of paragraph 3 shall not apply to the division of entities, if the assets
acquired as a result of the division, and in case of division by spin-off also the assets
remaining in the divided entity, do not constitute an organized part of an undertaking. In such
case, depreciation on acquired assets shall be written off in accordance with the principles laid
down in Article 16i-16m.
Art. 16i [Depreciation rates raising]
1. Depreciation on fixed assets, subject to Article 16j-16, shall be written off at depreciation
rates specified in the Depreciation Rates Schedule and rules, referred to in Article 16h.1.1.
2. Taxpayers may increase rates specified in the Depreciation Rates Schedule:
1) for buildings and structures used in the following conditions:
a) deteriorated - with the application of coefficients not higher than 1.2;
b) poor - with the application of coefficients not higher than 1.4;
2) for machines, equipment and vehicles, with the exception of sea-going vessels, used more
intensively as compared with average conditions or requiring special technical efficiency -
with the application of coefficients not higher than 1.4;
3) for machines and equipment included in categories 4-6 and 8 of the Classification of Fixed
Assets (KT) issued pursuant to separate regulations, hereinafter referred to as "the
Classification", subject to fast technological advancement - with the application of
coefficients not higher than 2.0.
3. In case of the occurrence or cessation of conditions justifying the increase of rates, referred
to in paragraph 2.1 and 2.2, those rates shall be increased or reduced from the month
following the month, in which the circumstances underlying those changes occurred.
4. Taxpayers may increase rates for fixed assets referred to in paragraph 2.3 or cease to apply
them beginning with the month following the month, in which those assets were entered in the
inventory, or from the first month of each following tax year.
5. Taxpayers may reduce rates for individual fixed assets specified in the Depreciation Rates
Schedule. Rates shall be changed beginning with the month, in which those assets were
entered in the inventory, or from the first month of each following tax year.
6. In case of increase of depreciation rates specified in the Depreciation Rates Schedule with
the application of coefficients specified in paragraph 2, one selected coefficient should be
used for individual fixed assets, by which the specific depreciation rate for a given fixed asset,
taken from the Depreciation Rates Schedule, shall be multiplied.
7. Explanations concerning the conditions for the use of buildings and structures,
determination of special technical efficiency of machines, equipment and vehicles and
equipment subject to fast technological advancement, referred to in paragraph 2, are contained
in the notes to the Depreciation Rates Schedule.
Art. 16j [Individual depreciation rates]
1. Subject to Article 16l, taxpayers may individually set depreciation rates for used or
improved fixed assets, for the first time entered in the inventory of a given taxpayer, with the
proviso that the depreciation period may not be shorter than:
1) for fixed assets classified in categories 3-6 and 8 of the Classification:
a) 24 months - when their initial value does not exceed PLN 25 000;
b) 36 months - when their initial value is above PLN 25 000 and does not exceed PLN 50
000;
c) 60 months - in other cases;
2) for vehicles, including passenger cars, referred to in Article 16.3a - 30 months;
3) for buildings (premises) and structures - 10 years, with the exception of buildings included
in types 103 and 109 of the Classification, permanently fixed to the ground, commodity
stands with the cubic measurement of over 500 m3, bungalows and substitute buildings, for
which that period may not be shorter than 36 months.
2. Fixed assets, referred to in paragraphs 1.1 and 2, shall be deemed as:
1) used - if the taxpayer proved that before they were purchased they had been used for at
least 6 months, or
2) improved - if before entering them in the inventory the costs incurred by the taxpayer for
their improvement accounted for at least 20% of their initial value.
3. Fixed assets, referred to in paragraph 1.3, shall be deemed as:
1) used - if the taxpayer proved that before they were purchased they had been used for at
least 60 months, or
2) improved - if before entering them in the inventory the costs incurred by the taxpayer for
their improvement accounted for at least 30% of their initial value.
4. Taxpayers may individually set depreciation rates for investments in third party fixed assets
accepted for use, with the proviso that for:
1) investments in third party buildings (premises) or structures, the depreciation period may
not be shorter than 10 years,
2) investments in third party fixed assets other than those referred to in subparagraph 1, the
depreciation period shall be determined in accordance with the principles laid down in
paragraphs 1.1 and 2
5. (deleted)
Art. 16k [Degressive method]
1. Depreciation may be written off the initial value of machines and equipment classified in
categories 3-6 and 8 of the Classification and vehicles, with the exception of passenger cars,
referred to in Article 16.3a, in the first tax year of their use with the application of rates laid
down in the Depreciation Rates Schedule reduced, subject to paragraph 2, by the coefficient
of not more than 2.0, and in the following tax years - their initial value reduced by the hitherto
depreciation write-offs, determined as at the beginning of the subsequent years of their use.
Beginning with the tax year, in which so determined annual depreciation amount would be
lower than the annual depreciation amount calculated with the method referred to in Article
16i.1, taxpayers continue to write off depreciation in accordance with Article 16i.
2. In case of use of fixed assets, described in paragraph 1, in an undertaking located in a
community specially threatened with high structural unemployment or in a community
threatened with recession and social degradation, whose list shall be determined by the
Council of Ministers pursuant to separate regulations - the rates included in the Depreciation
Rates Schedule may be increased with the application of coefficients not higher than 3.0,
calculating depreciation write-offs in accordance with the principle laid down in paragraph 1.
3. If in the course of the tax year the community is excluded from the list, referred to in
paragraph 2, the taxpayer may continue to apply the increased depreciation rates until the end
of that year.
4. Depreciation may be written off the initial value of brand-new fixed assets, classified in
categories 3-6 of the Classification, in the first tax year in which those assets were entered in
the inventory, in the amount of 30% that value.
5. Should the amount of depreciation write-offs determined in accordance with paragraph 4 be
lower than write-offs calculated in accordance with paragraph 1, then taxpayers may write off
depreciation at the rate from the Depreciation Rates Schedule increased by a coefficient of not
more than 3,0. In that case the annual amount of depreciation shall be determined in
proportion to the number of full months remaining until years end from the time the assets
were entered in the inventory.
6. Taxpayers may write off depreciation, as referred to in paragraphs 4 and 5, at a time, not
earlier than in the month in which fixed assets were entered in the inventory, or apply the
principles laid down in Article 16h.4. In the following tax year taxpayers depreciation shall be
written off the initial value in accordance with paragraph 1 or Article 16i.
Art. 16l [Depreciation of sea-going vessels]
1. Depreciation on sea-going vessels under construction, referred to in Article 16a.2.4, shall
be written off by monthly installments at depreciation rates set for sea-going vessels in the
Depreciation Rates Schedule.
2. Depreciation write-offs on sea-going vessels, referred to in paragraph 1, shall be calculated
on the basis of that part of the contract value, referred to in Article 16h.1.2, increased by
subsequent expenditures (advances) incurred for the construction of a given vessel; those
expenditures successively increase the depreciation base in the month following the month in
which they were incurred.
3. Depreciation shall be written off, as referred to in paragraph 1, until the end of the month in
which a given vessels is commissioned; if no contract transferring ownership of the ordered
vessel onto the shipowner is concluded, the shipowner shall be obliged to reduce deductible
costs by depreciation write-offs made, calculated in accordance with paragraphs 1 and 2, in
the month in which the contract was abandoned.
4. Commissioned sea-going vessels shall be depreciated in accordance with Article 16i. The
sum total of depreciation written off in accordance with Article 16i and depreciation written
off, as referred to in paragraph 2, must not increase the initial value of a given sea-going
vessel.
Art. 16 [Depreciation of third party assets]
1. Taxpayers depreciate fixed assets and intangible assets, received for use against a
consideration under agreements concluded pursuant to the commercialization and
privatization regulations, in accordance with the principles laid down in Article 16h.1, if those
agreements provide for the right of the user to buy those assets for a price specified in those
agreements. Depreciation rates shall be determined, account being taken of Articles 16i and
16m, prorated to the period arising from the agreement, with the exception of fixed assets and
intangible assets with a shorter depreciation period than the effective period of the agreement.
2. In case of acquisition of fixed assets or intangible assets received for use against a
consideration under agreements, referred to in paragraph 1, before the effective period of the
agreement expired, taxpayers continue to depreciate those assets in accordance with the
principles and at rates specified in paragraph 1.
3. In case of lengthening the effective period of the agreement concluded pursuant to the
regulations, referred to in paragraph 1, depreciation rates shall be reduced prorated to the
period of extension of the effective period of the agreement, with the exception of fixed assets
or intangible assets whose depreciation period is shorter than the effective period of the
agreement; that principle shall apply exclusively to depreciation rates applied from the month
following the month in which the agreement was amended.
4. Fixed assets or intangible assets, transferred for use under agreements other than those
referred to in paragraph 1, shall be depreciated by the financing or the using party, as
appropriate, in accordance with the principles laid down in Article 16h-16k and Article 16m,
account being taken of the provisions of Chapter 4a.
5. If agreements, other than those referred to in paragraph 1, concern fixed assets classified in
category 3-6 of the Classification and were concluded for a period of at least 60 months, and
in accordance with the provisions of Chapter 4a depreciation is written off by the using party,
the taxpayer my apply the principles laid down in paragraphs 1-3.
6. If in accordance with the provisions of Chapter 4a depreciation is written off by the using
party, and if the agreements, referred to in paragraph 4 or 5, are amended, expired or are
terminated, and as a result thereof the ownership of fixed assets or intangible assets is not
transferred onto the using party, taking back those assets the owner shall determine their
initial value, in accordance with Article 16g, prior to concluding the first leasing agreement,
reduced by the repayment of the initial value referred to in Article 17a.7 and the sum total of
depreciation write-offs, referred to in Article 16h.1.1 made by the owner.
Art. 16m [Depreciation of intangible assets - period]
1. Subject to paragraphs 2 and 3 and Article 16.1-16.3, the depreciation period for intangible
assets may not be shorter than:
1) for software licences (sublicences) and copyright - 24 months;
2) for distribution of movies and broadcasting of radio and TV programs - 24 months;
3) for costs incurred on completed development work - 12 months;
4) for other intangible assets - 60 months.
2. Should the agreed period of use of property rights, referred to in paragraph 1.2, be shorter
than the period laid own in that provision, taxpayers may depreciate those rights within the
agreed period.
3. Taxpayers shall set depreciation rates for individual intangible assets for the entire
depreciation period prior to starting depreciating them.
4. The cooperative ownership right to an apartment, the cooperative right to commercial
premises and the right to a single-family house in a housing cooperative shall be depreciated
at the annual depreciation rate of 2,5%.

Rozdzia 4. Tax exemption items.


Art. 17 [Tax exemption items]
1. The following items shall be free from income tax:
1) revenues derived from selling all or a part of real property making up an agricultural
undertaking; the exemption shall not apply to income from selling, if the sale is made within a
period of less than five years from the end of the calendar year, in which all or part of real
property being sold was acquired;
2) (repealed)
3) income derived outside of the territory of the Republic of Poland by the taxpayers, referred
to in Article 3.1, if an international agreement to which the Republic of Poland is a party so
provides;
4) income of taxpayers, subject to paragraph 1c, whose statutory purposes include scientific,
scientific-technical, didactic, educational, including teaching of students, cultural activities,
activities in the field of physical culture and sports, environment protection, supporting
community initiatives with respect to the construction of roads and the telecommunications
network, and water supply in rural areas, charity, health protection and social welfare,
occupational and social rehabilitation of disabled persons, religious cult - the part thereof
appropriated for those purposes;
4a) income of ecclesiastical legal persons:
a) from non-commercial statutory activities; to that extent ecclesiastical legal persons shall
not be obliged to keep the documentation required by the provisions of the Taxation Act;
b) from other activities - the part thereof appropriated for the purposes of: religious cult,
educational, scientific, cultural, charity and welfare activities, and conservation of historical
relics, running of religion teaching centres, sacral investments with respect to: construction,
expansion and reconstruction of churches and chapels, adaptation of other buildings for sacral
purposes, as well as other outlays on religion teaching centres and welfare institutions;
c) (deleted)
4b) income of companies whose sole participants (shareholders) are ecclesiastical legal
persons -the part thereof appropriated for the purposes, referred to in subparagraph 4a letter
(b);
4c) (deleted)
4d) income of organizational units of the Voluntary Fire Brigades - the part thereof
appropriated for statutory purposes; to that extent those units shall not be obliged to keep the
documentation required by the provisions of the Taxation Act;
4e) taxpayers income from non-agricultural commercial activities, including special sectors
of agricultural production - the part thereof appropriated for agricultural activities, referred to
in Article 2.2, if in the year preceding the tax year, and in case of starting the activities - in the
first tax year of those activities, the share of revenues from agricultural activities, determined
in accordance with Articles 12-14, plus the value of raw and intermediate materials,
originating from own plant and animal production, used for agricultural and food processing,
accounted for at least 60% of revenues derived from all types of activities.
4f) (repealed)
4g) income of associations of local government units - the part thereof appropriated for those
units;
4h) (repealed)
4i) (repealed)
4j) (repealed)
4k) income of Bank Gospodarstwa Krajowego operating the National Housing Fund,
Thermomodernisation Fund and National Road Fund, and banks operating housing funds,
equivalent to income derived by those Funds or housing funds from titles specified in separate
regulations - the part thereof appropriated exclusively for implementation of purposes,
described in those regulations, of those Funds or housing funds, as appropriate;
4l) (deleted)
4) (repealed)
4m) (repealed)
4n) (repealed)
4o) (repealed)
4p) income of the National Health Fund - the part thereof appropriated for statutory purposes;
4r) income of Bank Gospodarstwa Krajowego operating the National Credit Guarantee Fund,
equivalent to income allocated to that Fund;
4s) (repealed)
4t) income of the Student Loans and Credits Fund, operated by Bank Gospodarstwa
Krajowego;
4u) income of the Farmers Social Security Contributions Fund, referred to in the regulations
concerning social security for farmers - the part thereof appropriated for the statutory
purposes, excluding commercial activities;
4w) (repealed)
4x) income of Bank Gospodarstwa Krajowego operating the Inland Navigation Fund and the
Reserve Fund, equivalent to income derived by those funds from titles specified in the
regulations concerning their establishment and functioning - the part thereof appropriated
exclusively for implementation of purposes, described in those regulations;
4y) income of Bank Gospodarstwa Krajowego operating the Subsidies Fund, equivalent to
income derived by that Fund from titles specified in the regulations concerning its
establishment and functioning - the part thereof appropriated exclusively for implementation
of purposes, described in those regulations;
4z) income of Bank Gospodarstwa Krajowego operating the EU Guarantees Fund, equivalent
to income allocated to that Fund;
5) income of companies whose participants (shareholders) are exclusively organizations
operating under the Associations Act, whose statutory purpose includes activities, referred to
in subparagraph 4 - the part thereof appropriated for those purposes and allocated to those
organizations;
6) (repealed)
6a) (repealed)
6b) (repealed)
6c) income of public benefit organizations, referred to in the regulations concerning public
benefit and voluntary activities - the part thereof appropriated for the statutory activities,
excluding commercial activities;
7) (repealed)
8) (repealed)
9) (deleted)
10) (deleted)
11) (repealed)
12) (deleted)
13) (repealed)
14) (repealed)
14a) grants from the state budget received by way of co-financing projects implemented
within the framework of the Special Pre-Accession Programme for Agriculture and Rural
Development (SAPARD);
14b) (repealed)
15) income from non-agricultural activities and special sectors of agricultural production
appropriated for remuneration of members of farming cooperatives and other cooperatives
involved in agricultural production and their household members - if that remuneration is
related to said activities;
16) income from running prize lotteries and prize bingo games under a permit issued pursuant
to separate regulations;
17) income of legal persons whose seats or head office is not located in the territory of the
Republic of Poland, derived from activities conducted in the Republic of Poland and financed
with funds provided by international financial institutions and granted by foreign states under
agreements concluded by the Council of Ministers of the Republic of Poland or a minister
upon the consent of the Council of Ministers with those institutions or states;
18) on the principles of reciprocity, income derived from commercial activities conducted in
the territory of the Republic of Poland by cultural centres of foreign states;
19) income in the amount of the nominal value of treasury bonds or cash received under the
regulations concerning financial restructuring of enterprises and banks to increase equity and
reserves;
20) income of national investment funds, established under the Act of 30 April 1993 on
National Investment Funds and Their Privatization (Dz.U. No. 44, item 202, of 1994 No. 84,
item 385 and of 1997 No. 30, item 164, No. 47, item 298 and No. 107, item 691), from
dividends and other revenues from a share in the profits in legal persons whose seats are
located in the territory of the Republic of Poland, as well as from selling shares or stocks of
companies whose seats are located in the territory of the Republic of Poland;
21) grants, subventions, subsidies and other gratuitous performances, subject to subparagraph
14 and 14a, obtained to cover costs or as refunds of expenses linked with the receipt, purchase
or own manufacture of fixed assets or intangible assets, which are depreciated in accordance
with Articles 16a-16m;
22) income from the activities of the Insurance Guarantee Fund, the Ombudsman of the
Insured and the Polish Transport Insurance Bureau;
23) income obtained by taxpayers from the governments of foreign states, international
organizations or international financial institutions, from non-refundable aid funds, including
the funds of framework programmes for research, technical development and presentation of
the European Union and NATO programmes, granted on the basis of a unilateral declaration
or agreements concluded with those states, organizations or institutions by the Council of
Ministers, the competent minister or government agencies; including also the cases whereby
those funds are distributed through an agency authorized to distribute non-refundable aid
funds to beneficiaries;
24) interest on funds, referred to in subparagraph 23, deposited in term bank accounts;
25) (repealed)
26) income of sea port or harbour managers - the part thereof appropriated for construction,
expansion and modernization of port infrastructure and for implementation of tasks specified
in Article 7.1.2 and 7.1.4 of the Act of 20 December 1996 on Sea Ports and Harbours (Dz.U.
of 1997 No. 9, item 44 and No. 121, item 770 and of 1999 No. 62, item 685),
27) (repealed)
28) (repealed)
29) (repealed)
30) income of the Guarantee Fund, referred to in Article 15.1e.4;
31) (deleted)
32) (deleted)
33) (repealed)
34) income, subject to paragraphs 4-6, derived from commercial activities conducted within
special economic areas under permits, referred to in Article 16.1 of the Act of 20 October
1994 on Special Economic Areas (Dz.U. No. 123, item 600, of 1996 No. 106, item 496, of
1997 No. 121, item 770, of 1998 No. 106, item 668, of 2000 No. 117, item 1228, of 2002 No.
113, item 984 and No. 240, item 2055 and of 2003 No. 188, item 1840), with the proviso that
the amount of public aid granted in the form of this exemption must not exceed the
permissible amount of public aid for entrepreneurs in areas classified as in need of aid in the
highest amount, in accordance with separate regulations;
35) (repealed)
36) direct subsidies applied under the Common Agricultural Policy of the European Union,
received pursuant to separate regulations;
37) income of Bank Gospodarstwa Krajowego operating the Municipal Investment
Development Fund, equivalent to income derived by that Fund from titles specified in the
regulations concerning its establishment and functioning - the part thereof appropriated
exclusively for implementation of purposes, described in those regulations;
38) (repealed)
39) income of trade union, socio-occupational organizations of farmers, agricultural
chambers, employer organizations and political parties, operating under separate acts of law -
the part thereof appropriated for the statutory activities, excluding commercial activities;
40) membership fees of members of political, social and professional organizations - the part
thereof not appropriated for commercial activities.
1a. The exemption, referred to in paragraph 1, concerning taxpayers appropriating their
income for statutory purposes and other purposes described in that provision, shall not apply
to:
1) income from commercial activities consisting in manufacturing of electronic products,
fuels, tobacco products, spirits, wines, beers, as well as other alcoholic beverages with alcohol
content of more than 1,5%, as well as products made of precious metals or including those
metals, or trading in those products; however, the exemption shall apply to income of
scientific and research and development facilities, within the meaning of separate regulations,
from activities consisting in manufacturing of electronic products;
1a) income from activities consisting in giving fixed assets or intangible assets for use against
a consideration on conditions laid down in Articles 17a-17k;
2) income, regardless of the time of its generation, expended on purposes than other described
in those regulations.
1b. The exemption, referred to in paragraph 1, concerning taxpayers appropriating income for
statutory purposes or other purposes described in that provision, shall apply if income is
appropriated and - regardless of the time - expended on purposes described in that provision,
including acquisition of fixed assets and intangible assets directly serving implementation of
those purposes and payment of taxes not treated as the deductible costs.
1c. The provision of paragraph 1.4 shall not apply in:
1) state-owned enterprises, cooperatives and companies;
2) incorporated municipal companies, for which the function of the founding body is
performed by local government units or their subsidiary entities established pursuant to
separate regulations;
3) budgetary establishments and other unincorporated organizational units which pay
corporate incomes tax - if the object of their activities is to satisfy public needs indirectly
linked with environmental protection with respect to: water supply and sewage systems,
municipal sewage, waste dumps and municipal waste management and its collective transport.
1d. The share, referred to in paragraph 1.4e, in the amount of revenues derived from all types
of activities, shall be determined without taking into account revenues derived from:
1) in connection with payment of debts owed to the Agricultural Real Property Agency with
claims bought from creditors of that Agency;
2) from selling agricultural products purchased by cooperatives involved in agricultural
production from members of those cooperatives - the part thereof equivalent ot the purchasing
price of those products.
1e. The exemption, referred to in paragraph 1, concerning taxpayers appropriating their
income for statutory purposes or other purposes described in that provision, shall apply also in
case of investing income through purchasing:
1) bonds issued by the State Treasury after 1 January 1989 or bonds issued by local
government units after 1 January 1997;
2) securities and financial instruments other than securities allowed for public trading,
providing they have been purchased with respect to management of third partys securities
portfolio on commission, referred to in Article 30.2.4 of the Act of 21 August 1997 on Public
Trading in Securities (Dz.U. of 2002 No. 49, item 447 and No. 240, item 2055 and of 2003
No. 50, item 424 and No. 84, item 774), on conditions that those securities have been
deposited in a separate account kept by an authorized entity within the meaning of the said
Act;
3) participation units in investment funds operating pursuant to the provisions of the Act of 27
May 2004 on Investment Funds (Dz.U. No. 146, item 1546).
1f. The exemption, referred to in paragraph 1e, shall apply, if income has been appropriated
and expended, regardless of the time, for purposes described in paragraph 1.
2. The minister competent for public finance shall specify, in conjunction with the minister
competent for education, by way of an ordinance, the types of expenses which may be treated
as incurred for such purposes with in the meaning of paragraph 1.7.
3. (repealed)
4. The taxpayer shall be eligible for the exemption, referred to in paragraph 1.34, exclusively
with respect to income derived from commercial activities conducted within the area.
5. Should the permit, referred to in paragraph 1.34, be withdrawn, the taxpayer shall lose the
right to exemption and shall be obliged to pay the tax for the entire period throughout which
the exemption was applied.
6. Should the circumstances, referred to in paragraph 5, occur, the taxpayer shall be obliged to
increase the taxable base by the amount of income, in relation to which the taxpayer lost the
right to exemption, and in case a loss was incurred to reduce it by that amount - in accounting
for the withholding tax for the month, in which the taxpayer lost that right, and when the loss
of the right occurred in the last month of the tax year - in the annual return.

Rozdzia 4a. Taxation of parties to a lease


agreement.
Art. 17a [Definitions] Whenever in this Chapter there is a mention of:
1) lease agreement - it shall mean the agreement referred to in the Civil Code, as well as any
other agreement, under which one of the parties thereto, hereinafter referred to as the "lessor",
gives for use against a consideration and for deriving benefits under the conditions laid down
in the Act to the other party, hereinafter referred to as the "lessee", amortizable fixed assets or
intangible assets, as well as land;
2) primary lease period - it shall mean the definite period of time for which the lease
agreement has been concluded, excluding the time by which it may be extended or reduced;
3) depreciation (write-offs) - it shall mean depreciation written off exclusively in accordance
with the provisions of Article 16a-16m, account being taken of Article 16;
4) normative depreciation period - it shall mean in relation to:
a) fixed assets - the period in which depreciation write-offs resulting from the application of
depreciation rates laid down in the Depreciation Rates Schedule, become equal to the initial
value of fixed assets;
b) intangible assets - the period set in Article 16m ;
5) net actual value - it shall mean the initial value of fixed assets or intangible assets updated
in accordance with separate regulations, reduced by the sum total of depreciation written off
as referred to in Article 16h.1.1
6) net hypothetical value - it shall mean the initial value determined in accordance with
Article 16g minus:
a) depreciation calculated in accordance with the principles laid down in Article 16k.1,
account being taken of coefficient 3 - in relation to fixed assets;
b) depreciation calculated over the depreciation periods reduced three times, referred to in
subparagraph 4b - in relation to intangible assets
7) repayment of the initial value of fixed assets or intangible assets, determined in accordance
with Article 16g, within the primary lease period; that repayment shall not be adjusted by the
amount paid to the lessee, referred to in Article 17d or Article 17h.
Art. 17b [Lease payments]
1. Payments specified in the lease agreement to be paid by the lessee during the primary lease
period for the use of fixed assets and intangible assets shall constitute income of the lessor
and appropriately deductible costs for the lessee, subject to paragraph 2, if the agreement
meets the following conditions:
1) it has been concluded for a definite period of time, constituting at least 40% of the
normative depreciation period, if it concerns depreciable movables or intangible assets, or has
been concluded for a period of at least 10 years, if it concerns depreciable real property; and
2) the sum total of payments specified therein, minus the goods and services tax due,
corresponds with at least the initial value of fixed assets or intangible assets.
2. If the lessor at the date of concluding the lease agreement enjoys income tax reliefs granted
in accordance with:
1) Article 6;
2) regulations concerning special economic areas;
3) Article 23 and 37 of the Act of 14 June 1991 on Companies with Foreign Participation
(Dz.U. of 1997 No. 26, item 143, of 1998 No. 160, item 1063 and of 1999 No. 49, item 484
and No. 101, item 1178)
- the taxation principles described in Article 17f-17h shall apply to that agreement.
Art. 17c [Transfer of ownership] If after the expiration of the primary lease period, referred to
in Article 17b.1, the lessor transfers the ownership of leased fixed assets or intangible assets
onto the lessee:
1) revenues from selling fixed assets or intangible assets shall be their value expressed as the
price specified in the sales contract; however, if that price is lower than net hypothetical value
of fixed assets or intangible assets, that income shall be determined at market value in
accordance with the principles laid down in Article 14;
2) in determining income from selling the deductible costs shall be net actual value.
Art. 17d [Transfer of ownership]
1. If after the expiration of the primary lease period, referred to in Article 17b.1, the lessor
transfers the ownership of leased fixed assets or intangible assets onto a third person and pays
the lessee an agreed amount with respect to repayment of their value - the provisions of
Articles 12-16 shall apply for determining revenues from selling and the deductible costs.
2. The amount paid to the lessee, in the case described in paragraph 1, shall be treated as a
deductible cost of lessor as at the date of payment up to the difference between net actual
value and net hypothetical value.
3. The amount received by the lessee, in the case described in paragraph 1, shall constitute the
lessees income as at the date of its receipt.
Art. 17e [Continued use] If after the expiration of the primary lease period, referred to in
Article 17b.1, the lessor gives leased fixed assets or intangible assets to the lessee for
continued use, lessors revenues and appropriately lessees deductible costs shall be payments
set by the parties to that agreement.
Art. 17f [Conditions for inclusion of payments]
1. The part of payments, referred to in Article 17b.1, constituting repayment of the initial
value of fixed assets or intangible assets shall not be included in lessors revenues and
appropriately lessees deductible costs, if all of the following conditions have been met:
1) the lease agreement has been concluded for a definite period of time;
2) the sum total of payments specified therein, minus the goods and services tax due,
corresponds with at least the initial value of fixed assets or intangible assets;
3) the agreement provides that during the primary lease period depreciation shall be written
off by the lessee.
2. If the amount of repayment of the value of fixed assets or intangible assets falling on
individual payments has not been set in the lease agreement, it shall be prorated over the
effective period of that agreement.
Art. 17g [Revenue and costs after the expiration of the lease period]
1. If the conditions, referred to in Article 17f.1, have been met and after the expiration of the
primary lease period the lessor transfers the ownership of leased fixed assets or intangible
assets onto the lessee:
1) revenues from selling fixed assets or intangible assets shall be their value expressed as the
price specified in the sales contract, also when it significantly differs from their market value;
2) expenses incurred by the lessor for acquiring or manufacturing leased fixed assets or
intangible assets shall not be treated as deductible costs; however, those expenses minus the
repayment of the initial value, referred to in Article 17a.7, shall be treated as deductible costs.
2. If after the expiration of the primary lease period, referred to in Article 17f.1, the lessor
gives leased fixed assets or intangible assets to the lessee for continued use, lessors revenues
and appropriately lessees deductible costs shall be payments set by the parties to that
agreement, also when the significantly differ from market value.
Art. 17h [Transfer of ownership after the expiration of the lease period]
1. If the conditions, referred to in Article 17f.1, have been met and after the expiration of the
primary lease period the lessor transfers the ownership of leased fixed assets or intangible
assets onto a third party and pays to the lessee an agreed amount as repayment of their value:
1) in determining revenues from selling the provisions referred to in Articles 12-14 shall be
applied;
2) expenses incurred by the lessor for acquiring or manufacturing leased fixed assets or
intangible assets shall not be treated as deductible costs; however, those expenses minus the
repayment of the initial value, referred to in Article 17a.7, shall be treated as the deductible
costs.
2. The amount paid to the lessee shall be treated as the deductible cost of the lessor and shall
be treated as revenue of the lessee as at the date of its receipt.
Art. 17i [Land]
1. If the lease agreement concluded for a definite period of time concerns land, and the sum
total of payments specified therein corresponds with at least the value of land equal to the
expenses on its acquisition - the part of payments set in that agreement and incurred by the
lessee during the primary lease period constituting repayment of that value shall not be treated
as lessors revenues and appropriately lessees deductible costs; the provision of Article 17f.2
shall apply, as appropriate.
2. If after the expiration of the primary lease period the lessor transfers the ownership of
leased land onto the lessee or gives it to the lessee for continued use, the provisions of Article
17g and Article 17h shall be applied, as appropriate, to determining revenues and deductible
costs of the parties to that agreement.
Art. 17j [Specification of price in the agreement]
1. If the agreement specifies the price at which the lessee shall be entitled to buy the leased
object after the expiration of the primary lease period, that price shall be considered in the
sum total of payments, referred to in Article 17b.1.2 and Article 17f.1.2.
2. The sum total of payments, referred to in paragraph 1, shall not include:
1) payments to the lessor for additional performance, if they are separated from lease
payments;
2) taxes to be paid by the lessor for ownership or possession of leased fixed assets, as well as
premiums for the insurance of those fixed assets, if the lease agreement provides that the
lessee shall be paying those taxes and premiums apart from lease payments;
3) the security deposit specified in the lease agreement paid to the lessor by the lessee.
3. The security deposit, referred to in paragraph 2.3, shall not be treated as lessors revenues
and appropriately lessees deductible costs.
Art. 17k [Transfer of claims concerning payments]
1. If the lessor transferred to a third person claims concerning payments, referred to in Article
17b.1, and the ownership of the leased object has not been transferred onto a third person:
1) amounts paid by the third person for the transfer of ownership shall not be treated as
lessors revenues;
2) a discount or a consideration paid to the third person shall be treated as lessors deductible
costs.
2. In the case, referred to in paragraph 1, payments made by the lessee to the third person shall
be treated as lessors income as at due date.
Art. 17l [Reference to the provisions of Article 12-16] The provisions, referred to in Articles
12-16, for tenancy and lease agreements, shall apply to taxation of the parties to an agreement
concluded for an indefinite period of time or for a definite period of time but not meeting the
conditions laid down in Article 17b.1.2, or Article 17f.1, or Article 17i.1.

Rozdzia 5. Taxable base and the amount of


tax.
Art. 18 [Taxable base]
1. Subject to Articles 21 and 22, the taxable base shall be income determined in accordance
with Article 7 or Article 7a.1, after the following deductions:
1) donations for purposes described in Article 4 of the Act of 24 April 2003 on Public Benefit
and Voluntary Activities, to organizations, referred to in Article 3.2 and 3.3 of that Act,
conducting public benefit activities in the area of public assignments described in that Act - a
total of up to not more than 10% of income, referred to in Article 7.3 or Article 7a.1;
2) (deleted)
3) (deleted)
4) (deleted)
5) (repealed)
6) in banks - 20% of the amount of credits (loans) written off in connection with
implementation of a restructuring programme pursuant to separate acts of law, classified as
lost and included in the deductible costs;
7) donations for the purposes of religious cult - a total of up to not more than 10% of income,
referred to in Article 7.3 or Article 7a.1.
1a. The total amount of deductions for the purposes described in paragraph 1.1 and 1.7 may
not exceed in the tax year the amount corresponding to 10% of income, referred to in Article
7.3 or Article 7a.1, with the proviso that deductions cannot be made for donations made in
favour of:
1) natural persons;
2) legal persons and unincorporated organizational units conducting commercial activities
consisting in manufacturing of electronic products, fuels, tobacco products, spirits, wines,
beers, as well as other alcoholic beverages with alcohol content of more than 1,5%, as well as
products made of precious metals or including those metals, or trading in those products.
1b. If the object of donation are goods taxed with the goods and services tax, the amount of
the donation shall be the value of those goods including the goods and services tax due. In
determining the amount of those donations Article 14 shall apply as appropriate.
1c. The deduction, referred to in paragraph 1.1, shall apply, if the amount of donation has
been documented with a receipt documenting payment to the bank account of the beneficiary,
and in case of donation other than in cash - a document stating the value of that donation and
a the beneficiarys declaration of its acceptance.
1d. (repealed)
1e. Taxpayers, subject to paragraph 1h, receiving donations, referred to in paragraph 1.1 and
1.7 and in Article 26.1.9 of the Personal Income Tax Act of 26 July 1991, shall be obliged to:
1) in the return, referred to in paragraph 27.1, single out from revenues the total amount of
donations received, indicating its purpose in accordance with the area of public benefit
activities, referred to in Article 4 of the Act, referred to in paragraph 1.1, and also the purpose,
referred to in paragraph 1.7, detailing donations received from legal persons, giving the name
and address of the benefactor, if the amount of a single donation exceeds PLN 15 000 or if the
sum total of all donations received in the tax year from one benefactor exceeds PLN 35 000;
2) at the time of filing the return, referred to in Article 27.1, make available the information,
referred to in subparagraph 1, for public knowledge, through publication on the Internet, mass
media or display for those concerned in generally accessible places, and notify thereof in
writing the competent head of fiscal office. Entities, whose income for the given tax year does
not exceed the amount of PLN 20 000 shall be exempted from that obligation.
1f. Taxpayers receiving donations, referred to in paragraph 1.1 and 1.7 and in Article 26.1.9
of the Personal Income Tax Act of 26 July 1991, who do not file the return, referred to in
Article 27.1, shall be obliged, within the time limit, referred to in Article 27.1, to:
1) provide fiscal office with information as to the total amount of donations received,
indicating its purpose in accordance with the area of public benefit activities, referred to in
Article 4 of the Act, referred to in paragraph 1.1, and also the purpose, referred to in
paragraph 1.7, detailing donations received from legal persons, giving the name and address
of the benefactor, if the amount of a single donation exceeds PLN 15 000 or if the sum total of
all donations received in the tax year from one benefactor exceeds PLN 35 000;
2) make available the information, referred to in subparagraph 1, for public knowledge,
through publication on the Internet, mass media or display for those concerned in generally
accessible places, and notify thereof in writing the competent head of fiscal office. Entities,
whose income for the given tax year does not exceed the amount of PLN 20 000 shall be
exempted from that obligation.
1g. Taxpayers availing themselves of the deduction under paragraph 1.1 or 1.7 shall be
obliged to show in the return, referred to in Article 27.1, the amount of the donation
transferred, the amount of the deduction made and data allowing for identification of the
beneficiary, in particular their name, address and tax identification number.
1h. The provisions of paragraphs 1e and 1f shall apply, as appropriate, to taxpayers, referred
to in Article 17.1.4a, who file the return, referred to in Article 27.1, receiving donations
referred to in paragraph 1.1 and 1.7 and in Article 26.1.9 of the Personal Income Tax Act of
26 July 1991.
2. (deleted)
3. (deleted)
3a. (deleted)
4. (deleted)
5. (deleted)
6. (deleted)
6a. (deleted)
6b. (deleted)
6c. (deleted)
7. (deleted)
Art. 18a (deleted)
Art. 19 [Tax rate]
1. Subject to Articles 21 and 22, the tax shall amount to 19% of the taxable base.
2. (repealed)
3. (deleted)
4. Should the tax authorities or the fiscal control authorities determine, pursuant to Article 11,
income of the taxpayer in the amount higher (loss in the amount lower) than declared by the
taxpayer in connection with the transaction, referred to in Article 9a, and the taxpayer has not
presented those authorities with tax documentation required under those provisions - the
difference between income declared by the taxpayer and determined by those tax authorities
shall be taxed at the rate of 50%.
Art. 20 [Crediting of foreign tax]
1. If taxpayers, referred to in Article 3.1, have derived income also outside of the territory of
the Republic of Poland and that income has been taxed in the foreign state, and the
circumstances, referred to in Article 17.1.3, have not occurred, that income shall be combined
with income derived in the territory of the Republic of Poland. In that case the amount equal
to income tax paid in the foreign state shall be deducted from the tax calculated for the sum
total of incomes. However, that deduction may not exceed that portion of income tax
calculated before the deduction, which is prorated for income obtained in a foreign state.
2. In case, when:
1) an incorporated company, whose seat or head office is located in the territory of the
Republic of Poland, derives income (revenues) from dividends and other revenues from a
share in the profits of a legal person; and
2) income (revenues), referred to in subparagraph 1, is derived from a share in the profits of a
company taxable with income tax on the entirety of its income, regardless of where its has
been derived, in the territory of a state other than a European Union member state, with which
the Republic of Poland has concluded an agreement on avoidance of double taxation; and.
3) the company, referred to in subparagraph 1, has a direct interest in the equity of the
company, referred to in subparagraph 2, of not less than 75%
- the amount of tax on income, the profit of which has been paid, paid by the company,
referred to in subparagraph 2, in the state of its seat - the part thereof corresponding with the
share of the company, referred to in subparagraph 1, in the paid profits of the company,
referred to in subparagraph 2 - shall also be deducted .
3. In case, when:
1) an incorporated company, whose seat or head office is located in the territory of the
Republic of Poland, derives income (revenues) from dividends and other revenues from a
share in the profits of legal persons; and
2) income (revenues), referred to in subparagraph 1, is derived from a share in the profits of a
company taxable with income tax on the entirety of its income, regardless of where its has
been derived, in the territory of a European Union member state other than the Republic of
Poland; and.
3) the company, referred to in subparagraph 1, has a direct interest in the equity of the
company, referred to in subparagraph 2, of not less than 10%
- the amount of tax on income, the profit of which has been paid, paid by the company,
referred to in subparagraph 2, in the state of its seat - the part thereof corresponding with the
share of the company, referred to in subparagraph 1, in the paid profits of the company,
referred to in subparagraph 2 - shall also be deducted .
4. In case, when:
1) an incorporated company, whose seat or head office is located in the territory of the
Republic of Poland, derives income (revenues) from dividends and other revenues from a
share in the profits of a legal person, referred to in subparagraph 2; and
2) the company taxable with income tax on the entirety of its income, regardless of where its
has been derived, in the territory of a European Union member state other than the Republic
of Poland, derives income (revenues) from dividends and other revenues from a share in the
profits of a company, referred to in subparagraph 3; and
3) income (revenues), referred to in subparagraph 2, is derived from a share in the profits of a
company taxable with income tax on the entirety of its income, regardless of where its has
been derived, in the territory of a European Union member state other than the Republic of
Poland; and.
4) the company, referred to in paragraph 1, has a direct interest in the equity of the company,
referred to in subparagraph 2, of not less than 10%, and the company, referred to in
subparagraph 2, has a direct interest in the equity of the company, referred to in subparagraph
3, of not less than 10%
- the amount of tax on income, the profit of which has been paid, paid by the company,
referred to in subparagraph 3, in the state of its seat - the part thereof corresponding with the
share of the company, referred to in subparagraph 2, in the paid profits of the company,
referred to in subparagraph 2, and the share of the company, referred to in subparagraph 1, in
the paid profits of the company referred to in subparagraph 2 - shall also be deducted .
5. The provision of paragraph 4 shall apply, as appropriate, to any subsequent company,
taxable with income tax on the entirety of its income, regardless of where its has been
derived, in the territory of a European Union member state other than the Republic of Poland,
paying out dividends or other amounts due under the share in profits of legal persons to a
company, holding a direct interest in its equity of not less than 10%.
6. The total amount of deductions, referred to in paragraphs 2-5, subject to paragraph 1, may
not exceed that portion of income tax calculated before the deduction, which is prorated for
income obtained from that source of income.
7. In case it is not possible to make the deduction, referred to in paragraphs 2-5, the amount of
the tax shall be deducted, in accordance with the principles laid down in these provisions, in
subsequent tax years; the provision of paragraph 6 shall apply, as appropriate.
8. Determining the amount of deductions, referred to in paragraph 1 and in paragraphs 2-7,
the amount of the tax paid shall be converted into the Polish currency at the average rate of
exchange of the National Bank of Poland as at the date of payment of that tax.
9. The deductions, referred to in paragraphs 2-7, shall apply when the company deriving
income (revenues) from dividends and other revenues from a share in the profits of legal
persons has held the shares (stocks) of the company paying out those dues in the amount,
specified in paragraph 2.3, paragraph 3.3, paragraph 4.4 and paragraph 5, uninterruptedly for
a period of two years.
10. The deductions, referred to in paragraphs 2-7, shall also apply when the period of
uninterrupted holding of shares (stocks), in the amount specified in paragraph 2.3, paragraph
3.3, paragraph 4.4 and paragraph 5, by the company deriving income from a share in the
profits of a legal person, expires after the date of receipt of that income. in case the
requirement of holding of shares (stocks), in the amount specified in paragraph 2.3, paragraph
3.3, paragraph 4.4 and paragraph 5, uninterruptedly for a period of two years has not been
kept, the deducting company shall be obliged to file an adjustment to the return, referred to in
Article 27.1, for the tax years in which the deduction was made and to pay tax together with
interest for default. Interest shall be accrued as of the date following the time limit for filing
the return on income obtained (loss incurred) for the tax year, in which the company made the
deduction.
11. The provisions of paragraphs 2-10 shall not apply, when dividends and other revenues
from a share in profits of legal persons have been paid as a result of liquidation of the paying
company.
12. The provisions of paragraphs 3-11 shall apply, as appropriate:
1) when determining income of a company taxable with income tax on the entirety of its
income, regardless of where its has been derived, in the territory of a European Union
member state other than the Republic of Poland, derived by a foreign facility of that company
located in the territory of the Republic of Poland; and
2) to cooperatives etablished pursuant to Regulation No. 1453/2003/EC of 22 July 2003 on
the statute of the European Cooperative (SCE) (JL.ECL 207 of 10 September 2003).
13. A foreign facility, referred to in Article 12.1, shall mean:
1) a permanent facility, through which the entity, whose seat or head office is located in the
territory of one state, performs all or part of the activities in the territory of another state, in
particular a place of management, branch, office, factory, workshop or a place of extraction of
natural resources;
2) a construction site, construction, assembly or installation, performed in the territory of a
state by an entity, whose seat or head office is located in the territory of another state;
3) a person, who in the name and on behalf of an entity, whose seat or head office is located
in the territory of one state, acts in the territory of another state, if that person is empowered to
conclude contracts in its name and actually exercises that power
- if the entity, referred to in subparagraphs 1-3, whose seat or head office is located in the
territory of one state, is taxable on income derived by the foreign facility in the state, where
that facility is located.
14. The provisions of paragraphs 1-13 shall be applied, as appropriate, to entities listed in
Annex No. 4 to this Act.
Art. 21 [Tax on licence fees]
1. Income tax on revenues derived in the territory of the Republic of Poland by taxpayers,
referred to in Article 3.2:
1) from interest, from copyright or related rights, from rights to inventions, trademarks and
ornamental designs, including also from selling those rights, from fees for disclosing the
secrets of a technique or a production process, for the use or the right to use industrial,
commercial or scientific equipment, including vehicles, and for information related to the
experience acquired in industry, commerce or science (know-how);
2) from charges for services in the area of performances, entertainment or sports, performed
by natural persons domiciled abroad, and organized through natural persons or legal persons
conducting commercial activities related to artistic, entertainment or sport events in the
territory of the Republic of Poland;
2a) from performance of: consulting, accounting, market research, legal, advertising,
mangement and control, data processing, staff recruitment, guarantee and warranty, and
similar services
- shall amount to 20% of those revenues
3) with respect charges due for the transport of cargo or passengers taken on board in Polish
ports by foreign merchant shipping undertakings, with the exception of transit cargo and
passengers;
4) generated in the territory of the Republic of Poland by foreign air transport undertakings
- shall amount to 10% of those revenues.
2. The provisions of paragraph 1 shall apply with account being taken of double taxation
avoidance agreements, to which the Republic of Poland is a party.
3. Revenues, referred to in paragraph 1.1, shall be exempted from income tax if all of the
following requirements have been met:
1) the amounts due, referred to in paragraph 1.1, are paid by:
a) an income tax paying company whose seat or head office is located in the territory of the
Republic of Poland; or
b) a foreign facility, within the meaning of Article 20.13, located in the territory of the
Republic of Poland, of a company taxable with income tax on the entirety of its income,
regardless of where its has been derived, in the territory of a European Union member state ,
if the amounts due, referred to in paragraph 1.1, paid by that facility, are classified as the
deductible costs while determining taxable income in the Republic of Poland;
2) the party deriving revenues, referred to in paragraph 1.1, is a company taxable with income
tax on the entirety of its income, regardless of where its has been derived, in the territory of a
a European Union member state other than the Republic of Poland;
3) the company:
a) referred to in subparagraph 1, has a direct interest in the equity of the company, referred to
in subparagraph 2, of not less than 25%; or
b) referred to in subparagraph 2, has a direct interest in the equity of the company, referred to
in subparagraph 1, of not less than 25%; or
c) taxable with income tax on the entirety of its income, regardless of where its has been
derived, in the territory of a a European Union member state, has a direct interest in the equity
of the company, referred to in subparagraph 1, and in the equity of the company, referred to in
subparagraph 2 - of not less than 25%;
4) the amounts due, referred to in paragraph 1.1, are paid to:
a) the company, referred to in subparagraph 2; or
b) a foreign facility, within the meaning of Article 20.13, of the company, referred to in
subparagraph 2, if income derived as a result of the reciept of those amounts is taxable in the
EU member state, where that facility is located.
4. The provision of paragraph 3 shall apply when the companies, referred to in paragraph 3.3,
have had the shareholding in the amount, referred to in paragraph 3.3, uninterruptedly for a
period of two years.
5. The provisions of paragraphs 3 and 4 shall also apply when the period of uninterrupted
holding of shares (stocks), in the amount specified in paragraph 3.3, expires after the date of
receipt of revenues, referred to in paragraph 1.1, by the company, referred to in paragraph 3.2.
In case the requirement of holding of shares (stocks), in the amount specified in paragraph
3.3, uninterruptedly for a period of two years has not been kept, the company, referred to in
paragraph 3.2, shall be obliged to pay tax together with interest for default on revenues,
referred to in paragraph 1.1, amounting to 20% of revenues, taking into account double
taxation avoidance agreements, to which the Republic of Poland is a party. Interest shall be
accrued as of the next day after expiration of the time limit, referred to in Article 26.3.
6. The exemption, referred to in paragraph 3, shall not apply to revenues, which in accordance
with separate regulations, have been classified as:
1) revenues from the distribution of profits or repayment of capital of the company paying the
amounts due, referred to in paragraph 1.1;
2) revenues from a debt entitling to participate in debtors profits;
3) revenues from a debt entitling the creditor to exchange his right to interest for the right to
participate in debtors profits;
4) revenues from a debt, which does not involve the obligation to repay the principal of that
debt or when the debt matures after a period of at least 50 years.
7. If as a result of special linkages, referred to in Article 11.1, between the paying entity and
the entity receiving the amounts due, referred to in paragraph 1.1, conditions shall be set ot
imposed differing from the conditions which would have been mutually agreed by
independent entities, in consequence of which the amounts paid are higher than would have
been expected if those linkage did not exist, the exemption, referred to in paragraph 3, shall be
applied only to the amount determined without taking into account the conditions arising from
those linkages. The provisions of Article 11.2 and 11.3 shall apply, as appropriate.
8. The provisions of paragraphs 3-7 shall be applied, as appropriate, to entities listed in Annex
No. 5 to this Act.
Art. 22 [Tax on dividends]
1. Tax on income from dividends and other revenues with respect to a share in the profits of
legal persons, whose seat is located in the territory of the Republic of Poland, subject to
paragraph 2, shall amount to 19% of derived revenues.
2. The tax on income, referred to in paragraph 1, from persons, referred to in Article 3.2, shall
amount to 19% of revenues, unless otherwise provided in an agreement on avoidance of
double taxation concluded with the country of the seat or head office of the taxpayer.
3. Companies included in a tax capital group, obtaining income, referred to in paragraph 1,
from companies making up that group, shall be exempted from income tax, unless the
requirements for treating the group as a taxpayer have been violated. In that case, the tax
liability, referred to in Article 26, shall arise of the date of the tax capital group losing the
right to be treated as a taxpayer.
4. Income (revenues) from dividends and other revenues from a share in the profits of legal
persons shall be exempted from income tax if all of the following requirements have been
met:
1) the dividend or other amounts due with respect to a share in the profits of legal persons are
paid by a company, whose seat or head office is located in the territory of the Republic of
Poland;
2) the party deriving income (revenues) from dividends and other revenues from a share in the
profits of legal persons, referred to in subparagraph 1, is a company taxable with income tax
on the entirety of its income, regardless of where its has been derived, in the territory of an
European Union member state other than the Republic of Poland;
3) the company, referred to in subparagraph 2, has a direct interest in the equity of the
company, referred to in subparagraph 1, of not less than 10%
4) Income (revenues) from dividends and other revenues from a share in profits of legal
persons are received by:
a) a company, referred to in subparagraph 2; or
b) a foreign facility, within the meaning of Article 20.13, of the company, referred to in
subparagraph 2, if income derived is taxable in the EU member state, where that facility is
located.
4a. The exemption, referred to in paragraph 4, shall apply when the company deriving income
(revenues) from dividends and other revenues from a share in the profits of legal persons has
held the shares (stocks) of the company paying out those dues in the amount specified in
paragraph 4.3, uninterruptedly for a period of two years.
4b. That exemption shall also apply when the period of uninterrupted holding of shares
(stocks), in the amount specified in paragraph 4.3, expires after the date of receipt of revenues
from a share in the profits of a legal person. In case the requirement of holding of shares
(stocks), in the amount specified in paragraph 4.3, uninterruptedly for a period of two years
has not been kept, the company, referred to in paragraph 4.2, shall be obliged to pay tax
together with interest for default on revenues, referred to in paragraph 1, amounting to 19% of
revenues, taking into account double taxation avoidance agreements, to which the Republic of
Poland is a party. Interest shall be accrued as of the next day after expiration of the time limit,
referred to in Article 26.5.
5. (repealed)
6. The provisions of paragraphs 2-4b shall be applied, as appropriate, to entities listed in
Annex No. 4 to this Act.
Art. 22a [Condition for application] The provisions of Articles 20-22 shall apply with account
being taken of agreements on avoidance of double taxation, to which the Republic of Poland
is a party.
Art. 23 [Crediting of tax on dividends]
1. The amount of tax paid on dividends and other revenues with respect to participation in
profits of legal persons, whose seat is located in the territory of the Republic of poland, shall
be deducted from the amount of the tax calculated in accordance with Article 19.
2. In case it is not possible to make the deduction, referred to in paragraph 1, the amount of
the tax shall be deducted, in accordance with the principles laid down in that provision, in
subsequent tax years.
Art. 24 (deleted)

Rozdzia 6. Collection of tax.


Art. 25 [Withholding tax]
1. Subject to paragraphs 2a, 3-6a and Articles 21 and 22, taxpayers shall be obliged to file,
without call, declarations, in accordance with the specified sample, on income obtained (loss
incurred) from the beginning of the tax year and pay to the account of fiscal office monthly
withholding tax amounting to the difference between the tax due on income derived from the
beginning of the tax year and the sum total of withholding tax due for the preceding months.
2. Declarations and monthly withholding tax, referred to in paragraph 1, for the period from
the first to the penultimate month of the tax year, shall be filed and paid by the 20-th of each
month for the preceding month. Withholding tax for the last month shall be paid in the
amount of the withholding tax for the preceding month by the 20-th of the last month of the
tax year; the tax for the tax year shall be finally settled by the time limit established for filing
a return on the amount of income obtained (loss incurred) in that year.
2a. Taxpayers deriving in the tax year revenues from agricultural activities, referred to in
Article 2.2, and from other sources, from whim in the year preceding the tax year the share of
revenues from agricultural activities in total revenues, determined in accordance with Article
17.1.4e, amounted to at least 50%, may file the declarations and pay withholding tax, referred
to in paragraphs 1 and 2, beginning as of 20-th October of each year.
3. The provision of paragraph 1, subject to paragraph 3a, shall not apply to subsidiary
undertaking of budgetary entities and to taxpayers, whose entire income is tax free, with the
exception of taxpayers, referred to in Article 17.1, appropriating that income for statutory
purposes or other purposes described in that provision.
3a. The provision of paragraph 1 shall not apply also to taxpayers, referred to in Article
17.1.4a (a).
4. If taxpayers, referred to in Article 17.1, had previously declared that they would
appropriate income for purposes described in those provisions and expended that income for
other purposes - the tax on that income shall be paid, without call, by the 20-th day of the
month following the month in which the expense was made; this provision shall apply also to
income for the years preceding the tax year, declared and not expended for the purposes
described in Article 17.1b. In the declarations filed taxpayers shall be obliged to demonstrate
the sum total of income, including income for the year preceding the tax year, appropriated by
not expended by the end of the period covered by the declaration.
5. The taxpayer, who has filed with the competent head of fiscal office a written declaration
that he:
1) stopped the activities; or
2) is a taxpayer, referred to in paragraph 4, and does not derive income from activities,
referred to in Article 17.1a.1, and does not make expenditures for purposes other than those
described in Article 17.1b, 17.1e and 17.1f
- shall be exempted from the duties, arising from paragraph 1 as of the date of filing that
declaration. Should the facts underlying that exemptions change, the taxpayer shall be obliged
to apply, without call, the provisions of paragraphs 1-4.
6. Without the duty to file monthly declarations, taxpayers may pay monthly withholding tax
in a given tax year in a simplified form amounting to 1/12 of the tax due as shown in the
return, referred to in Article 27.1, filed in the year preceding the given tax year. If in that
return taxpayers have not shown the tax due, they may pay monthly withholding tax
amounting to 1/12 of the tax due as shown in the return filed in the year preceding the given
tax year by two years. If in that year taxpayers did not show the tax due, either, it shall not be
possible to pay withholding tax in the simplified form.
6a. If the return, referred to in Article 27.1, filed in the year preceding the given tax year
refers to a tax year which was shorter or longer than 12 consecutive months - taxpayers may
pay withholding tax for the given tax year in a simplified form at the amount of the tax due
shown in that return, prorated for each month of the tax year the return refers to. If in that
return taxpayers have not shown the tax due, they may pay monthly withholding tax in a
manner outline above, with the proviso that the amount of the tax due should arise from the
return filed in the year preceding the given tax year by two years. The provision of the last
sentence of paragraph 6 shall apply, as appropriate.
7. The taxpayers, who have chosen to pay withholding tax in accordance with the principles
laid down in paragraphs 6 and 6a, shall be obliged to:
1) within the time limit for paying the first withholding tax in the tax year, in which they for
the first time chose to pay withholding tax in the simplified form, notify of that in writing the
competent head of fiscal office;
2) apply that form of paying withholding tax throughout the tax year;
3) pay withholding tax by the time limits specified in paragraphs 2 and 2a, taking into account
the principles laid down in those provisions;
4) (deleted)
5) make tax assessment for the tax year in accordance with Article 27.
7a. The notification, referred to in paragraph 7.1, shall apply also to the subsequent years,
unless the taxpayer, by the time limit of payment of the first withholding tax for the given tax
year, notifies in writing the competent head of fiscal office of having waived the simplified
form of payment of withholding tax.
8. The provisions of paragraphs 6, 6a and 7 shall not apply to taxpayers, who for the first time
started activities in the year preceding the tax year or in the tax year.
9. If the taxpayer files an adjustment of the return, referred to in Article 27.1, causing a
change in the taxable base for the withholding tax paid in the simplified form, the amount of
that withholding tax:
1) shall be increased or decreased relative to the change in the taxable base for its calculation -
if the adjusting return was filed to the fiscal office by the end of the year preceding the tax
year in which withholding tax is paid in the simplified form;
2) shall be increased or decreased, beginning with the month following the month in which
the adjustment was filed, relative to the change in the taxable base for its calculation - if the
adjusting return was filed in the tax year in which withholding tax is paid in the simplified
form;
3) shall not be changed - if the adjusting return was filed later than the time limit, referred to
in subparagraph 1 and 2.
10. Should the competent tax authority assess income tax due in an amount different that
shown in the return, referred to in Article 27.1, or in the adjusting return, the provisions of
Article 9 shall apply, as appropriate.
11. Taxpayers, who from the time of starting commercial activities to the first day of the
month of the tax year, in which they start utilizing the exemption, have been functioning as
small businesses, within the meaning of regulations concerning commercial activities, shall be
exempt from the duties, arising from paragraph 1, in the tax year immediately following:
1) the first tax year, referred to in Article 8.2 and 8.2a - in case when that tax year lasted for at
least 10 full calendar months; or
2) the second tax year - in cases other than those referred to in subparagraph 1
- providing they have filed with the competent head of fiscal office a declaration concerning
the use of this exemption; the declaration shall be filed in writing by the 20-th of the first
month of the tax year covered by that exemption.
12. Taxpayers availing themselves of the exemption, referred to in paragraph 11, shall be
obliged to file the return, referred to in Article 27.1, and to pay the tax due for the year
covered by the exemption in five consecutive years immediately following the year in which
they utilized the exemption - amounting to 20% of the tax due shown in the return filed for
the year covered by the exemption; that tax shall be payable at times set for filing returns for
five consecutive tax years immediately following the year covered by that exemption.
13. The provisions of paragraphs 11 and 12 shall not apply to taxpayers:
1) established as a result of transformation, merger or division of taxpayers, referred to in
Article 3.1; or
2) established as a result of transformation of an unincorporated company or companies; or
3) established by natural persons, who contributed to the equity of the newly established
entity an undertaking they previously run or assets of that undertaking of a total value exceed
the PLN equivalent of at least EUR 10 000, converted at the average rate of exchange as
announced by the National Bank of Poland, effective as at the last day of the year preceding
the year of utilizing the exemption, with the proviso that the value of those assets has been
calculated applying, as appropriate, Article 14; or
4) established by legal or natural persons bringing in - as contributions in kind to their equity -
assets obtained by those persons as a result of liquidation of taxpayers, who availed
themselves of exemptions, referred to in paragraphs 11 and 12, if those persons held shares or
stocks of those liquidated taxpayers; or
5) who in the year preceding the year of utilizing the exemption, referred to in paragraph 11,
derived monthly average revenues in the amount of the PLN equivalent of not less than EUR
1000, converted at the average rate of exchange as announced by the National Bank of
Poland, effective as at the last day of the year preceding the starting year; or
6) who in the period preceding the year in which they utilized the exemption each month
employed full-time at least 5 persons under employment contracts.
14. Taxpayers, referred to in paragraph 11, shall lose the right to the exemption, if:
1) have been put to liquidation or declared bankrupt including liquidation of assets within the
period of utilizing the exemption or five following tax years; or
2) in any of the months in the year of utilizing the exemptions or in any of five following tax
years have reduced monthly average number of people employed under employment contract
by more than 10% in relation to the highest monthly average number of people employed in
the year preceding the tax year; or
3) in the year of utilizing the exemption or in five following tax years have derived monthly
average revenues from commercial activities in the amount of the PLN equivalent of not less
than EUR 1000, converted at the average rate of exchange as announced by the National Bank
of Poland, effective as at the last day of the year preceding the starting year; or
4) in the year or for the year of utilizing the exemption or in five following tax years, as
appropriate, have been in the arrears with respect of taxes constituting revenues of the state
budget, customs duties, and social security and health insurance contributions, referred to in
the Act of 27 August 2004 on Publicly Financed Health Benefits (Dz.U. No. 210, item 2135);
determination or assessment in a different form - as a result of the proceedings carried out by
the competent authority - of the arrears with respect to the above-mentioned titled shall not
deprive the taxpayer of the right to utilize the exemption, if those arrears together with interest
for default are paid within 14 days from the date of delivery of the final decision.
15. The monthly average number of people employed, referred to in paragraph 13.6 and 14.2,
shall be determined with respect to full-time jobs, leaving out the decimals; if the monthly
average number of persons employed is less than one, number of one is adopted.
16. The taxpayers, who lost their right to the exemption:
1) in the tax year, in which they utilize that exemption - shall be obliged to file a declaration
concerning income obtained from the beginning of the year and to pay withholding tax due by
the 20-th day of the month following the month in which they lost the right to the exemption;
in that case no interest for default on arreas with respect to withholding tax for the individual
months of the year, in which the taxpayers utilized the exemption, shall be accrued;
2) in the first three months of the tax year immediately following the year in which they
utilized the exemption - shall be obliged to file a return on the amount of income obtained
(loss incurred) and pay tax in accordance with the principles laid down in Article 27.1; in that
case no interest for default on arrears with respect to withholding tax for the individual
months of the year, in which the taxpayers utilized the exemption, shall be accrued;
3) in the period between the time limit set for filing the return for the tax year following the
year in which they utilized the exemption until the end of the fifth tax year following the year
in which they utilized the exemption - shall be obliged to pay the tax due, referred to in
paragraph 12, together with interest for default; interest shall be accrued as of the date
following the time limit for filing the return, referred to in Article 27.1, in which they were
obliged to file that return;
Art. 25a [Payment]
1. In case of income, referred to in Article 10.2.2, the acquiring company shall be obliged to
pay, the tax, without call, by the 7-th day of the month following the month in which income
occurred, to the account of the fiscal office, referred to in Article 22, and send the declaration
by the same time limit.
2. The provision of paragraph 1 shall be applied, as appropriate, to entities listed in Annex
No. 3 to this Act.
Art. 26 [Duties of withholding agent]
1. Legal persons and unincorporated organizational entities and natural persons operating as
entrepreneurs, who pay out the amounts due under titles specified in Article 21.1 and in
Article 22, shall be obliged, as withholding agents, to collect, subject to paragraph 2, lump
income tax on those payments as at the date thereof. However, application of the tax rate
arising from a relevant agreement on avoidance of double taxation or waiving tax collection
in accordance with such agreement is possible providing the place of residence of the
taxpayer has been documented for tax purposes by a certificate (certificate of residence)
issued by a competent tax administration authority.
1a. Lump income tax, referred to in paragraph 1, shall not be collected, if taxpayers, referred
to in Article 17.1, utilizing the exemption with respect of appropriation of their income for
statutory purposes or other purposes described in that provision, present the withholding
agent, not later than at the date of payment of the amounts due, a declaration that they will
appropriate income from dividends and other income from shares in the profits of legal
persons - for purposes described in that provision.
1b. If revenues, referred to in Article 21.1.3, are derived from foreign principals, foreign
marine shipping companies shall be obliged to send to the fiscal office led by the head of of
fiscal office competent for the seat of the Maritime Agency, prior to the ships leaving a
Polish port, a declaration on the amount of revenues for exportation of cargo and transport of
passengers accepted on board in the Polish port and pay the tax due to the account of that
office. The foreign marine shipping company shall be obliged to present a copy of the
declaration and the proof of tax payment to the territorially competent Maritime Agency.
However, should it be not possible to determine the amount of revenues for exportation of
cargo and transport of passengers prior to the ships leaving a Polish port, the foreign marine
shipping company shall be obliged to pay withholding tax on expected income, and than
within 60 days from the ships leaving the port pass through that Agency final data on the
amount of revenues for exportation of cargo and transport of passengers and pay the
difference between the tax due and the amount of withholding tax paid.
1c. Legal persons and unincorporated organizational entities, who pay out the amounts due
under titles specified in Article 21.1.1, and Article 22.1 utilizing income tax exemption under
Article 21.3 and Article 22.4, shall apply that exemption exclusively if documented by the
company, referred to in Article 21.3 or company, referred to in Article 22.4.2:
1) the location of its seat for tax purposes issued by a competent tax administration authority
(certificate of residence); or
2) existence of the foreign facility, within the meaning of Article 20.13, by a certificate issued
by a competent tax authority of the state, where its seat or head office is located, or by a
competent tax authority of the state, where that facility is located.
2. Should income be appropriated for increasing the initial fund, and the share fund in
cooperatives, the withholding agents, referred to in paragraph 1, shall collect tax within 14
days from the date on which the decision of the registration court on making an entry of the
increase of the initial or share capital, and in cooperatives from the date on which a resolution
concerning the increase of the share fund was adopted. In that case taxpayers shall not be
entitled to file a declaration, referred to in paragraph 1a.
3. The withholding agents, referred to in paragraph 1, shall transfer the amounts of tax by the
7-th day of the month following the month in which, in accordance with paragraphs 1 and 2,
the withholding tax was collected, to the account of the fiscal office led by the head of fiscal
office competent for the taxpayers seat, and in case of taxpayers, referred to in Article 3.2 -
to the account of the fiscal office led by the head of fiscal office competent for matters of
taxation of aliens. Withholding agents shall be obliged to send to the fiscal office a
declaration on the tax collected, prepared in accordance with the specified sample, and to
taxpayers, referred to in Article 3.1, and Article 3.2 - information on payments made and tax
collected, prepared in accordance with the specified sample.
3a. The withholding agents shall be obliged to send the declaration, referred to in paragraph
3.1, within the time limit for transferring the amount of the tax collected, and the information,
referred to in paragraph 3.2, within the time limit by the end of the third month of the year
following the tax year, in which payments, referred to in paragraph 1, were made, also when
the withholding agent prepared and presented information in accordance with the procedure
provided for in paragraph 3b during the tax year.
3b. At a written request of the taxpayer, referred to in Article 3.2, the withholding agent shall
be obliged, within 14 days from the date of filing that request, to prepare and send to the
taxpayer and to the fiscal office led by the head of fiscal office competent for matters of
taxation of aliens, the information, referred to in paragraph 3.2.
3c. Should the withholding agent cease to operate by the end of the time limit, referred to in
paragraph 3a, the withholding agent shall transfer the information, referred to in paragraph
3.2, by the time limit until ceasing operations.
3d. The information, referred to in paragraph 3.2, shall also be prepared and transferred by the
entities, referred to in Article 21.1 and Article 22.2, when under an agreement on avoidance of
double taxation or the law they are not obliged to collect tax. The provisions of paragraphs 3b
and 3c shall apply, as appropriate.
4. Taxpayers, referred to in paragraph 1a, shall be obliged to file, without call, to the fiscal
office, specified in paragraph 3, a declaration, in accordance with the specified sample and
pay the lump tax due, if income from dividends and other revenues from shares in the profits
of legal persons, on which the taxpayer has not collected tax pursuant to the declaration,
referred to in paragraph 1a, have been expended on purposes other than those referred to in
Article 17.1.
5. The tax, referred to in paragraph 4, shall be paid by the 20-th day of the month following
the month in which that expenditure was made.
6. In case of income, referred to in Article 10.1.6, the acquiring or newly established company
shall be obliged, as a withholding agent, to pay the tax, referred to in Article 22, without call,
by the 7-th day of the month following the month in which income occurred, to the account of
the fiscal office led by the head of fiscal office competent for the seat of the taxpayer, and in
case of taxpayers, referred to in Article 3.2 - to the account of the fiscal office led by the head
of fiscal office competent for the matter of taxation of aliens. The taxpayer shall be obliged to
transfer the amount of that tax to the withholding agent prior to that time limit. By the time
limit for payment of the tax the withholding agent shall be obliged to send to the fiscal office
a declaration, and to the taxpayer - information on the tax collected, prepared in accordance
with the specified samples.
Art. 27 [Tax return]
1. Taxpayers, with the exception of those exempted from the tax pursuant to Article 6.1,
Article 17.1.4a(a) and provisions of the Act, referred to in Article 40.2.8, shall be obliged to
file with fiscal offices tax returns, in accordance with the specified sample, on the amount of
income obtained (loss incurred) in the tax year - by the end of the third month of the
following year and within that time limit pay the tax due or the difference between the tax due
on income shown in the return and the sum total of withholding tax for the period from the
beginning of the year.
1a. Subsidiary undertakings of budgetary entities, availing themselves of tax exemption
pursuant to Article 6.1.3 and Article 6.2, shall be obliged to file a return on the amount of
income obtained (loss incurred) in the tax year within the time limits and in accordance with
the principles laid down in paragraph 1.
1b. (deleted)
2. Taxpayers obliged to prepare financial statements shall submit to the fiscal office those
statements together with the opinion and report drawn up by an entity authorized to audit
financial statements, within 10 days from the date of approval of the annual financial
statements, and companies - also a copy of a resolution of the meeting approving the financial
statement. The duty to submit the opinion and report shall not apply to taxpayers, whose
financial statements have been exempted from the duty to be audited pursuant to separate
regulations.
Art. 28 [Branches (facilities)]
1. Taxpayers whose facilities (branches) are located in the area of a local government unit
other than the one competent for their seat, shall be obliged to file with the fiscal office,
within the time limit for payment of monthly withholding tax in case those payments are
made in a simplified form, or attach to the declaration and return on the amount of income
obtained (loss incurred) information, prepared pursuant to separate regulations, in order to
determine income with respect to the share of local government units in corporate income tax
paid.
2. The provision of paragraph 1 shall be applied, as appropriate, to a tax capital group,
represented by a company, referred to in Article 1a.3.4.
Art. 28a [Samples] The minister competent for public finance shall specify, by way of an
ordinance, samples of:
1) declarations, and information referred to in Article 25.1, Article 25a and in Article 26.1b,
26.3, 26.4 and 26.6;
2) returns, referred to in Article 27.1;
3) declarations, referred to in Article 26.1a;
4) information, referred to in Article 18.1f.1
- together with instructions as to their filling, time limit and place of filing.