| 07 January, 2021

Changes in the jurisdiction of tax authorities from 1 January 2021. Changes in withholding tax postponed to 1 July 2021.

Changes in the jurisdiction of tax offices

Starting from 1 January 2021, the changes concerning the jurisdiction of tax offices that were introduced during the last days of 2020 are coming into effect. The First Mazovian Tax Office (Pierwszy Mazowiecki Urząd Skarbowy) becomes the competent office for legal persons with revenues over EUR 50 million, and the Lublin Tax Office (Lubelski Urząd Skarbowy) becomes the competent office in respect of withholding tax for all entities throughout the country regardless of the amount of revenue.

According to the information that we received from the tax authorities, the taxpayers will be duly notified of the relevant change in jurisdiction by the competent tax office.

However, it should be noted that the regulation has been in force since 1 January 2021, and even if we have not been informed about the change but are subject to the above mentioned criteria, after January 1st we should be sending all letters/making tax payments to the applicable tax office determined in accordance with the new regulations.

This means that in the case of, e.g., withholding tax, the relevant tax payments should already be made to the Lublin Tax Office (Lubelski Urząd Skarbowy); similarly all letters and IFT-2R returns should be also submitted to that particular office.

Please find below an outline of the most important changes:

▶️ The jurisdiction of the First Mazovian Tax Office (Pierwszy Mazowiecki Urząd Skarbowy) shall now cover the territory of the entire country for the following types of entities :

legal persons and organizational units without legal personality which generated, as part of their business activity carried out throughout the given tax year, a revenue exceeding EUR 50 million (excluding civil code companies) and
regardless of the revenue threshold: companies listed on the Stock Exchange, tax capital groups and their member companies, the National Bank of Poland, state banks, and domestic banks operating in the form of joint stock companies, domestic insurance companies and domestic reinsurance companies

▶️ other specialized tax offices, e.g., Lower Silesian Tax Office (Dolnośląski Urząd Skarbowy) shall be competent for:

legal persons and organizational units without legal personality which generated, as part of their business activity carried out throughout the given tax year, a revenue of at least EUR 3 million, but not exceeding EUR 50 million (excluding civil code companies),
foreign entrepreneurs who achieved a net revenue of at least EUR 3 million in the territory of Poland during the given tax year
universities and independent public health care institutions which achieved a net revenue of at least EUR 3 million in the given tax year,
and regardless of the revenue threshold: branches or representative offices of foreign entrepreneurs, local government units, cooperative banks, cooperative savings and credit unions

▶️ entities with foreign capital participation, which do not meet the above-mentioned legal form or revenue/turnover (revenue/turnover lower than EUR 3 million) criteria, shall fall under the jurisdiction of ordinary tax offices instead of the specialized ones.

▶️ The Lublin Tax Office (Lubelski Urząd Skarbowy) becomes the office responsible for withholding tax (WHT) in respect of legal persons throughout the entire country (regardless of the size of the taxpayer entity and its revenue).

▶️ The Second Mazovian Tax Office (Drugi Mazowiecki Urząd Skarbowy) in Warsaw becomes the competent office for pension funds and investment funds

▶️ The Third Mazovian Tax Office (Trzeci Mazowiecki Urząd Skarbowy) in Radom becomes the competent authority in matters pertaining to corporate income tax on income from business activity obtained by non-resident taxpayers operating in the Mazovian voivodeship as well as in more than one voivodeship (thus far this role has been performed by the Third Tax Office Warszawa-Śródmieście).

In 2021, being classified into the above-mentioned category (where the entity is required to exceed the specified revenue threshold) is based on the data from 2019.

Changes in withholding tax postponed to 1 July 2021.

At the same time, we would like to note that the coming into force of the new withholding tax regulations introduced into the Act as of 1 January 2019 has been postponed again, this time until 1 July 2021. As a reminder - the new rules provide for withholding tax to be collected by the remitter at the basic rate when the sum of receivables subject to this tax with regard to a single taxpayer exceeds PLN 2 million in a given tax year.

Should you have any questions, please do not hesitate to contact us.

TIAS Tax Team

▶The relevant regulations can be accessed through the following links:

https://isap.sejm.gov.pl/isap.nsf/download.xsp/WDU20200002456/O/D20202456.pdf

http://isap.sejm.gov.pl/isap.nsf/download.xsp/WDU20200002410/O/D20202410.pdf

https://isap.sejm.gov.pl/isap.nsf/download.xsp/WDU20200002421/O/D20202421.pdf