In the underlying verdict, the Court presented very favourable for taxpayers interpretation of prerequisite referring to “direct connection” of the costs with the services provided by taxpayer (this is one of the exemption that allows the taxpayers not to apply the limitation provided by Article 15e of Polish CIT Act). The court stated that “direct connection” should be understood widely and it cannot be limited only to those expenses, which are further incorporated in the price of goods / services sold by the taxpayer. It should not be also equated with “costs directly generating revenues”.
WHAT CAN BE THE EFFECT OF THE JUDGEMENT AND HOW CAN WE HELP?
In our view the judgement may be very interesting point in discussion regarding potential solutions that may be now implemented by the taxpayers, also with respect to FY 2018-2019. Please note that besides argumentation that was raised in the verdict at hand, CRIDO’s litigation team developed additional argumentation which may strengthen the position of the taxpayers in this respect (also in case the taxpayers wishes to apply for a tax refund on the basis of application of “direct connection” rule provided by Article 15e of Polish CIT Act). We would be pleased to discuss with you this in details and discuss further strategy in your individual case.
Worth asking.
Anna Pęczyk-Tofel PARTNER CRIDO
E: anna.peczyk-tofel@crido.pl T: +48 22 324 59 36