Real estate tax on residential buildings intended for rent as part of business activity
The Supreme Administrative Court, in a resolution of 7 judges of 21 October 2024, III FPS 2/24, stated that residential buildings intended for rent as part of a business activity are not subject to the higher real estate tax rate that is binding for business activity, provided that they serve to meet the housing needs of tenants. The key is to meet housing needs, regardless of who fulfills them.
A tax remitter applying for a tax refund under Article 28b of the CIT Act is obliged to submit a taxpayer’s statement of being the beneficial owner of the dividend
The Supreme Administrative Court in its judgment of 9 October 2024, II FSK 78/22, stated that the provision of Article 22 sec. 4 of the CIT Act does not contain a requirement that the dividend in order to obtain tax exemption has to be paid to the beneficial owner, and in particular that the entity paying such a dividend is obliged to verify this circumstance. However, according to the judgment, the above legal view does not affect the interpretation of Article 28b sec. 2 point 2 of the CIT Act, which is an autonomous provision. If the tax remitter applies for a tax refund in this specific situation, which is provided for in this provision, they are obliged to submit the documents listed in this provision. In this respect, the legislator did not provide for the omission of the taxpayer’s beneficial owner statement. Thus, the tax remitter applying for a tax refund under Article 28b of the CIT Act is also obliged to submit the taxpayer’s statement as to being the beneficial owner of the dividend.
EURIBOR costs from a bank loan should be included in the debt financing cost limit
The Provincial Administrative Court in Warsaw, in its judgment of 23 October 2024, III SA/Wa 1757/24, stated that interest, including costs resulting from the EURIBOR rate, directly meet the conditions for recognizing them as debt financing costs and should be subject to limitation in accordance with Article 15c sec. 1 of the CIT Act.
The legislator did not prohibit the depreciation of investments in third-party fixed assets if these assets constitute buildings or structures
The Provincial Administrative Court in Warsaw, in its judgment of 17 October 2024, III SA/Wa 1620/24, held that Article 16a sec. 2 of the CIT Act distinguishes as fixed assets investments in third-party fixed assets and buildings and structures constructed on third-party land. The use of such a systematics indicates that the legislator, both in Article 16c point 2a of the CIT Act and in Article 71 sec. 2 of the Act of 29 October 2021 (the so-called act introducing the Polish Deal), did not include a prohibition on depreciation of investments in third-party fixed assets, if these assets constitute buildings or structures.
The book value of all real estate held directly and indirectly by subsidiaries that may be considered real estate companies is important
The Provincial Administrative Court in Warsaw, in its judgment of 16 October 2024, III SA/Wa 1771/24, confirmed that the interpretation, whereby the book value of shares or equity held in subsidiaries classified as real estate companies is used, is incorrect and unsupported by the wording of Article 4a point 35 of the CIT Act. This provision directly relates the book value of assets to the value of real estate rather than to the shares held in a real estate company.
