After 2 the years of application of the rules allowing taxable persons benefiting from intra-group financing to apply a simplified safe harp solution for loans granted between related entities, the level of margin provided for by the Ministry of Finance for that solution shall be corrected.
In the Official Journal of the Republic of Poland, a new MF notice on interest rate and margin for Safe Harbour loan for 2021
According to it, the relevant margin is:
(a) for the borrower the maximum amount 2.3 percentage point,
(b) for the lender is minimal 2 the percentage point.
Previous notice in force in years 2019 and 2020 the appropriate margin has ceased at one level 2% without distinction between separate levels for the borrower and the lender.
The type of underlying interest rate for loans, which is respectively WIBOR 3M, LIBOR USD 3M, EURIBOR 3M, LIBOR CHF 3M, LIBOR GBP 3M.
The fundamental benefits for taxpayers benefiting from this simplified solution are:
- no obligation for the taxpayer to prepare a comparative analysis/description of compliance for a controlled transaction covered by a safe Harbour;
- deviation of the tax authority from determining the income/loss of the taxpayer in terms of the interest rate of such a transaction.
In accordance with the other conditions laid down in the Income Tax Act, in addition to the interest rate fixing of the information contained in the MF Notice, a safe loan harp may be used if:
- no payment other than interest on fees related to the granting or handling of the loan, including commission or premium, is provided;
- the loan has been granted for a period of no longer than 5 years;
in the course of the financial year, the total level of liabilities or liabilities of the related entity in respect of the capital of the related entity calculated separately for the loans granted and undertaken shall be not more than 20,000,000 PLN or equivalent to that amount;
the lender is not a resident, established or managed entity in the territory or country applying harmful tax competition.
The full content of the notice can be found here https://dziennikustaw.gov.pl/M2020000119801.pdf
In case of any questions regarding the use of safe harpour loan, please contact us.
Author: Leszek Dutkiewicz, partner Russell Bedford Poland. Associated with the company from 2011. Director of RBP office in Katowice. In years 2008 – 2011 worked for leading consulting companies (Ernst&Young, KPMG, BDO) providing tax advisory services.
He specializes in tax and economic law, primarily in international tax law, tax proceedings, VAT and transaction prices. Author of a publication on tax, civil and international law issues. Lecturer in tax law training. He has legal education, in 2008 graduated from the Faculty of Law and Administration of the Jagiellonian University.