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Arrangements with the EU Commission on the minimum income tax from commercial buildings

Arrangements with the EU Commission on the minimum income tax from commercial buildings

Arrangements with the EU Commission on the minimum income tax from commercial buildings

  • Ministry of Finance is introducing amendments both to the CIT Act and PIT Act in respect of the minimum income tax from commercial buildings.
  • These amendments are the result of working consultations with the European Commission officials.
  • The aim of the proposed solutions is to tighten up legislation, which in consequence will lead to the efficient elimination of aggressive tax planning, while maintaining the rules on equal competition and in accordance with the state aid law.

The scope of the amendments:

  • such taxation will apply only to the buildings (or their parts) that are given for use under a contract of lease, tenancy, leasing etc. Vacant areas are not subject to the minimum tax. This change would also apply to the minimum tax for 2018,
  • introduction of change, how the 10 million PLN building value threshold shall be applied, to which the minimum tax is not applicable. The threshold will be applicable to the taxpayer regardless of the number of buildings owned (one free amount for the taxpayer for whole portfolio of its buildings),
  • the minimum income tax will now include all buildings with a simultaneous introduction of the exemption for residential buildings given for use in the framework of the implementation of government and local government social housing programs (to the extent permitted by the State aid provisions),
  • allowing the taxpayer to apply for a refund of the overpaid minimum tax (CIT or PIT amount) to the tax authority, the minimum tax shall be reimbursed if the tax authority confirms that group-internal prices reflect market terms, and thus the correctness of the income tax settlement. This change would also apply to the minimum tax for 2018,
  • introduction of the targeted anti-abuse clause relating to the minimum tax. Transfers made with the sole purpose to avoid the minimum tax will be disregarded by the tax authorities.
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