Individual interpretation and the protective opinion

Service-Tax

In order to protect yourself from the consequences of the application of the anti-avoidance clause, you should apply for a precautionary opinion. It is a legal institution completely different from individual interpretations of tax law provisions.

Each taxpayer, natural person, legal person, payer, as well as persons without a place of residence or registered office in the territory of Poland, who have doubts as to the application of tax regulations, may apply for an individual tax interpretation.

Individual interpretation - application

The director of the National Tax Information, at the written request of the interested party, issues a written interpretation of the tax law (individual interpretation) in his individual case.

The request for an individual interpretation may refer to the actual state of affairs or future events. The person submitting the application for an individual interpretation is obliged to comprehensively present the actual state of affairs or a future event and to present his own position on the legal assessment of this factual state or future event.

An individual tax interpretation protects an entrepreneur regardless of whether its provisions would be challenged by other authorities. The exception is the situation when the issued interpretation is changed ex officio by the minister competent for public finances.

The regulations provide for forms for submitting an application for interpretations, they are:

  • ORD-IN and ORD-IN / A - attached to ORD-IN, if the ORD-IN form is insufficient,

  • ORD-WS and ORD-WS / A and ORD-WS / B (in the case of joint applications).

The requirement for the correct submission of the application is:

  1. a comprehensive presentation of the actual state of affairs or a future event,

  2. presenting your own position on the legal assessment of the described facts or a future event,

  3. correct completion of the application and its payment,

  4. attaching a power of attorney to the application - if the application is submitted by an attorney (and paying for the power of attorney) - does not apply to attorneys registered in the Central Register of General Powers of Attorney.

The individual interpretation is payable, and its cost is PLN 40 for each actual state and future event presented in the application. This amount should be paid to the appropriate bank account of the authority to which the application for an individual interpretation is addressed, within 7 days from the date of submitting the application.

If several separate facts or future events are presented in one ORD-IN application, a fee is charged for each of them. Therefore, the product of PLN 40 and the number of presented facts or future events in the application for the interpretation should be paid to the bank account of the tax office.

The individual interpretation is not binding on the applicant. The application by the taxpayer to the tax ruling prior to its amendment may not harm the applicant. If you follow the interpretation that has been changed:

  • proceedings under the Fiscal Penal Code are not initiated (the initiated proceedings are discontinued),

  • no late payment interest is due,

  • if the tax consequences of the event covered by the interpretation arose before the taxpayer was delivered the individual interpretation - the taxpayer is not exempt from the obligation to pay the tax,

  • if the tax consequences of the event covered by the interpretation arose after the taxpayer was delivered the individual interpretation - the taxpayer is exempt from the obligation to pay the tax.

Security opinion

The precautionary opinion concerns the assessment of whether tax avoidance takes place. Security opinions are intended to protect taxpayers against the application of the anti-tax avoidance clause. The clause applies if the activity - although formally lawful - is artificial. It was performed primarily for the purpose of obtaining a tax advantage that, in the given circumstances, was contrary to the object and purpose of tax laws. The anti-tax avoidance clause is to be a tool enabling a more effective fight against illegal tax optimization, preventing activities contrary to the object and purpose of the provision of the tax act, made solely for the purpose of achieving tax savings.

The opinion is issued at the taxpayer's request by the Head of the National Revenue Administration within 6 months from the date of receipt of the request, and the fee for its issuance is PLN 20,000. In relation to a taxpayer who has obtained a security opinion, within the scope covered by it, no proceedings may be conducted using the provisions on the anti-avoidance clause.

The application for a security opinion should contain data relevant to the tax consequences of the activities, including in particular:

  1. applicant identification data;

  2. indication of entities performing the activities;

  3. an exhaustive description of the activities together with an indication of the relationships between the entities referred to in art. 11 of the Act of February 15, 1992 on corporate income tax and art. 25 of the Act of July 26, 1991 on personal income tax;

  4. an indication of the goals which the activity is to serve;

  5. an indication of the economic or economic justification of the activity;

  6. determination of tax consequences, including tax benefits, resulting from the activities covered by the application;

  7. presenting your own position on the matter.

Documentation relating to the activities, in particular the originals or copies of contracts or their projects, may be attached to the application for a security opinion. The application is subject to a fee of PLN 20,000, which must be paid within 7 days from the date of submission of the application. The applicant is additionally charged with the costs of the procedure, such as travel costs and the fees of experts and translators.

The head of the National Revenue Administration issues a security opinion when he agrees with the applicant that the anti-tax avoidance clause does not apply in the case at hand. When issuing an opinion, the authority does not limit itself to the provisions of the law, but also takes into account the comprehensive economic situation and the benefits of planned activities. After it is issued, it is sent to the applicant and disseminated in the Public Information Bulletin. Opinions are to be issued without undue delay - not later than within 6 months from the receipt of the application by the Minister. Failure to issue an opinion within this period has the same effect as consenting to the applicant's position.

Importantly, as pointed out by the Provincial Administrative Court in Kielce in the judgment of April 26, 2017, the rule is that if the circumstances presented in the application refer to the possibility of applying the anti-avoidance clause, the appropriate procedure for considering such an issue will be the procedure provided for issuing a protective opinion. by issuing such an opinion or by refusing to issue it (not to issue an interpretation). It follows from the above-mentioned judgment that the Director of the National Tax Information does not have the possibility or competence to comment on whether the clause is applied in a given case, because it is the responsibility of the Head of the National Tax Administration.