Following the public consultation, the Estonian CIT project was amended. one the good news is that entrepreneurs who allocate funds to the development of business will be able not to pay tax.
During the Business Dialogue and Public Consultation cycle, errors of the CIT system were identified in a new shape and were proposed to modify them, as well as some new solutions were introduced.
Changes in Estonian CIT:
The main criterion of entry into the new system concerns the revenues of the company (Estonian CIT may be covered by small and medium-sized equity companies (limited liability and share capital), which must not exceed 100,000,000 PLN. The previous threshold was 50,000,000 PLN, so after the consultations it was raised twice.
The employment condition has also been relaxed at least 3 employees (other than shareholder/shareholder) under an employment contract. The Company may continue to benefit from preferential taxation if it incurs expenses on remuneration for other civil law contracts (in a certain amount). And a small taxpayer can In the first Year of taxation employ one person, instead of third.
Milder entry conditions for start-ups have been maintained.
After the changes, the taxpayer may submit information on the withdrawal from the tax of Estonian CIT in the declaration made for the last tax year in which the taxpayer applied that tax.
A taxpayer taxed by the Estonian CIT will be able to reverse the tax losses incurred before joining the Estonian CIT.
A pioneer bonus will be introduced, i.e. no investment condition for first a two-year period.