m.i.kamiński

1. How to properly taxate the remunerations for the foreign employee ? member of the supervisory board of Polish company?

Income obtained by a person with permanent place of residence in Germany and received due to remunerations for holding position of a member of the supervisory board are taxed by Polish, flat-rated, 20% income tax. By the end of February following the tax year the company must send registered information concerning the amount of revenues provided on the IFT-1/IFT-1R forms to the member of the supervisory board and to the the Head of the Fiscal Office competent for the issues relating to taxation of foreign persons.

2. Is it possible to be subject to joint taxation together with a foreign husband who does not hold NIP (tax identification) number?

If the husband ? foreigner has been residing in Poland for over 183 days, he holds tax resident status and is a person with unlimited tax obligation, then the spouse can provide the assessment of income tax jointly even if the husband ? foreigner does not hold NIP number.
Moreover, since 1st January 2009 (effective for the tax return for the year 2008) new regulations have been introduced that enable the spouses joint taxation when one or both spouses are non-residents in Poland.

3. What requirements have to be met in order for the revenue office to transfer 1% of my tax for the benefit of the chosen non-profit organisation?

First and foremost, the taxpayer is required to submit the tax return independently (independently means that it is done without the agency of the withholding agent, i.e. employer or pension entity) within the deadline for submitting, i.e. PIT-28 no later than by 2nd February 2009 and PIT-37,  PIT-36, PIT-36L and PIT-38 no later than by 30th April 2009. The tax return submitted must contain the application for transferring 1% of tax. Practically, this requires filling in the appropriate part of tax return in which the taxpayer provides the name of the organization, KRS number and the amount declared. The amount is specified by the taxpayer but it must not exceed the amount of 1% of tax due, and it must be rounded down to whole groszes.
Last part requires payment of full amount of tax due which makes the basis for calculating the amount due for the non-profit organisation. Important, the payment cannot exceed the deadline of two months since the date of submitting the tax return. (source: szybkipit.pl)

4. Shall it be possible to indicate in yearly tax return for the year 2008 specific purpose relating to how to use the amount of money declared for the benefit of chosen non-profit organisation?

Yes. It can be done and specified in the part of tax return form that follows directly the application for transferring 1% of tax and is titled ?Additional information?. For example, in PIT-37 form it is entered under no. 128. However, it is important to bear in mind that it is the sign of taxpayer?s will and it is not binding for the non-profit organisation. As entities entitled to receive 1% of tax, the non-profit organisations are subject to both, the act on non-profit activities and volunteering, followed by the regulations applicable to income tax on natural persons. Internal distribution and how the resources are used is executed according to the subject of activity described in the organisation status and by the generally binding legal regulations. (source: szybkipit.pl)

5. Polish company employs German citizen who holds temporary residence in Poland. Is it allowed to include the amount of remuneration in the employment agreement expressed in EUR?

Since 24th January 2009, as a result of deleting paragraph 9 item 15 of the act on foreign exchange, the limits do not apply anymore to concluding the agreements and any other legal activities that result or may result in settlements performed in foreign currencies in Poland as well as performance of the above mentioned settlements in Poland.
As a result of the above described change, starting 24th January 2009, the remuneration can be expressed in foreign currency. It is allowed to express the remuneration in Polish zloty but as an equivalent of the amount described in foreign currency.

6. Is it possible to receive advance payment of dividend during the tax year?

Advance payment of dividend during the tax year is allowed, provided that:
1)    company agreement authorises the board to pay the dividend estimated for the given turnover year in advance, if the company possesses sufficient financial resources,
2)    financial statement concerning the previous turnover year has been approved and the company had incurred profit.

7. When does the obligation for preparing documentation for transfer pricing of transaction concluded between legal entities arises?

Pursue to the content of the regulation, paragraph 9a item 2 of the act of 15th February 1992 on income tax on legal entities, the taxpayers are obliged to prepare tax documentation relating to the above mentioned transactions concluded by the associated companies when the total amount (or its equivalent) resulting from the agreement or the total amount of fees required to be paid within one fiscal year and indeed paid within the fiscal year, exceeds the equivalent of:
- 100.000 EUR ? if the value of transactions does not exceed 20% of share capital, whereby the share capital does not include the part that has not been really provided for the purpose of the capital or which has been covered by the liabilities resulting from the loans (credits) as well as interests accrued in result of the above mentioned loans (credits), and which the shareholders are entitled to benefit as well as incorporeal and legal values that are not subject to depreciation allowance.
- 30.000 EUR ? in case of providing services, sales or making available incorporeal and legal values, or
- 50.000 EUR ? in other cases.

8. Can a car that has been repurchased of leasing become a gift and what are the tax consequences of such act?

There are no limitations for the owner (previously leaser that has executed the option for the buy out) to sell (or give) a car that has been previously repurchased of leasing. Tax consequences of such act shall depend on the way of qualifying the amount paid for the buy out, and on the grounds of the status of the car (in the context of deducting the input tax).
Private partnership (2 natural persons) uses personal car pursue to leasing agreement. After termination of the agreement the company buys the car out. The same day the car is taken over by one of the partners, at the moment representing a natural person that is not running business activity. Leasing agreement provides that the company is entitled to buy out the car for 1% of value. Natural person who wants to buy the car must pay the market price.

8.1. Subject to the above, will the partnership be obliged to pay VAT? Will both partners incur income subject to sale of the above mentioned car?

If the partnership buys the car out of leasing agreement, it can transfer it for the benefit of one of the partners. Such act shall be exempted from VAT obligation. The fiscal revenue shall not be incurred. (portal abc.com.pl)