Among government proposals to spend EU funds Polish Deal There have also been changes in tax credits.
Raised to 30,000 tax-free amount and raising the I tax threshold from 85,500 PLN to 120,000 PLN – are not the only changes proposed by the legislator. The programme combines IP-Box and R & D relief (BR). Simultaneous IP-BOX and R+R relief is intended to help digitalize services.
Relief for innovation – IP Box
Taxed entrepreneurs can benefit from the IP BOX relief:
- • on a tax scale (PIT-36)
- • linear tax (PIT-36L).
Taxable persons who earn eligible income from qualified intellectual property rights (IPs) are entitled to tax such income according to 5% the tax rate.
Qualified intellectual property rights are rights subject to legal protection under the provisions of separate laws or ratified international agreements to which the Republic of Poland is party and other international agreements to which the European Union is party:
- • patents
- • protective law on the utility model
- • right to register an industrial design
- • right from the registration of topography of the integrated circuit
- • additional protective right for patents on a medicinal product or plant protection product
- • the right to register the medicinal product and veterinary medicinal product authorised
- • exclusive right within the meaning of the plant variety law
- • copyright to computer program
- the subject-matter of which has been manufactured, developed or improved by the taxpayer in the course of his research and development.
The eligible income (loss) from qualified intellectual property rights is the income achieved by the taxpayer in the tax year (loss):
- • the fees and charges resulting from the licensing agreement which concerns qualified intellectual property rights
- • from their sale
- • of qualified intellectual property rights included in the sales price of the product or service
- • the compensation for violation of the rights deriving from a qualified intellectual property right if it has been obtained in the disputed proceedings, including judicial proceedings or arbitration.
The amount of eligible income from qualified intellectual property rights shall be determined as:
- income from qualified intellectual property rights acquired in the tax year; and
- an indicator calculated according to the formula which takes into account the costs incurred for R & D activities carried out by the taxpayer itself for the acquisition of R & D results from unrelated and related entities, the acquisition of intellectual property rights themselves.
Tax payers who choose to tax eligible income from qualified intellectual property rights benefit from 5% the tax rate in the tax return for the tax year in which they achieved income or incurred loss from qualified intellectual property rights and made an annual statement together with Annex PIT/IP.
Relief for R & D (R & D)
R & D (R & D) benefit from the benefit of:
- • on a tax scale (PIT-36)
- • linear tax (PIT-36L)
As a result of R & D activities, taxable persons are entitled to a reduction to deduct from the tax base part of the cost of obtaining revenues for this type of activity, which is defined as eligible costs.
This is therefore an additional reduction in the tax base for the same reason that the cost has already been included in the cost of obtaining revenue.
The following shall be considered eligible costs:
- salaries of employees employed for the purpose of carrying out R & D activities and related social security contributions, in the part where the time allocated for carrying out R & D activities remains at the general working time of the employee in the month concerned
- remuneration for contract contracts or for work in part related to research and development activities, in so far as the time allocated to the R & D service remains entirely the time allocated to the service under the contract or contract for work in a given month
- acquisition of materials and raw materials directly related to R & D
- acquisition of non-durable specialised equipment and materials and raw materials directly related to research and development
- studies, opinions, advisory services and equivalent services provided or performed on the basis of a contract by universities, federations of entities of the higher education and science system, scientific institutes of the Polish Academy of Sciences, research institutes, international scientific institutes, Łukasiewicz Centre, institutes operating within the Łukasiewicz Research Network, the Polish Academy of Skills, other entities conducting mainly scientific activities in an independent and continuous manner, as well as the acquisition of research results from such entity for research and development activities
- the use of research equipment exclusively used for research and development activities, if this use does not result from an agreement concluded with an entity affiliated to a taxpayer within the meaning of Article 23m(1)(4) PIT Act
- the acquisition of a service for the use of research equipment only for the purpose of research and development activities, where the purchase of the service does not result from a contract concluded with an entity affiliated to a taxpayer within the meaning of Article 23m(1)(4) PIT Act
- the costs of obtaining and maintaining a patent, the protection rights of a utility model, the rights of registration of an industrial design, incurred on:
- preparation of application documentation and filing a notification to the Patent Office of the Republic of Poland or an appropriate foreign body, including the costs of required translations into foreign language
- conduct of proceedings by the Patent Office of the Republic of Poland or the relevant foreign body, incurred since notification to those authorities, in particular official fees and costs of legal and procedural representation
- Rejection of allegations of non-compliance with the conditions required to obtain a patent, a protective right to a utility model or a right to register an industrial design in and after the application procedure, in particular the costs of legal and procedural representation, both in the Patent Office of the Republic of Poland and in the relevant foreign body
- periodic fees, renewal fees, translations and other activities necessary to grant or maintain the validity of a patent, a utility model protection right and a registration of an industrial design, in particular the costs of validating a European patent
- Depreciation write-offs on fixed assets and intangible assets used in R & D activities, excluding passenger cars and structures, buildings and premises which are separate property (subject to R & D centres).
Tax payers who intend to benefit from the relief must distinguish the costs of R & D activities in the records kept: in the accounts or in the tax accounts of revenues and expenses.
Eligible costs shall be deducted if they have not been reimbursed to the taxpayer in any form or have not been deducted from the income tax base.
The deduction shall be made in the statement for the tax year in which the eligible costs were incurred. Tax payers shall show in this statement the eligible costs to be deducted.
If, in the tax year for which the deduction is to be made, the taxable person has incurred a loss or the amount of income of the taxable person is less than the amount of deductions due to him, the deductions shall be made, in full or in the rest of the year, respectively, in statements subsequent to each other six the tax years immediately following the year in which the taxpayer benefited or was entitled to benefit from the deduction.
The taxable person who incurred a loss or income below the amount of the deduction for that year shall be entitled to a refund corresponding to the product of the unpaid deduction and the rate of tax applicable to that taxpayer in that tax year . This mechanism also applies in the tax year immediately after the start of the business year, if the taxpayer is a micro-entrepreneur, small or medium-sized entrepreneur within the meaning of the legislation. Act dated 6 March 2018 – Business law.
Important! A taxpayer who, in the year of start-up and in the period two the years from the end of the year preceding its start-up, he or she has been engaged in an economic activity on his or her own account or as a partner of a company which is not a legal person, or such an activity has been carried on by his or her spouse, if there was a material relationship between the spouses at that time, is not treated as a starting-up business.
The reimbursement shown in the statement constitutes de minimis aid .
De minimis aid is public aid – state support to small and medium-sized enterprises, which does not have to be notified to the European Commission. The definition of de minimis aid aims to preserve competition on the market in such a way that none of the market participants will receive any support that could distort competition.
If the taxable person before expiry third the tax years – counting from the end of the tax year for which he made a statement in which he showed the amount of the cash refund – were put in bankruptcy or liquidation, the amount shown must be reimbursed.
Other R & D reductions
In addition to the combination of the above mentioned reliefs Polish Deal provides for a relief for innovative workers and a relief for the prototype.
Details of these solutions have not yet been provided, but we know that first the solution is to be created in the form of Italy, where the costs of the researchers employed can be deducted under certain conditions (maybe the requirement will be the simultaneous use of R & D).
In turn, the relief for the prototype can function as in France. The new product, introduced in research and development (R & D) will include its production or placing on the market.