In 2024, the Minister of Finance issued a general ruling (No. DD8.8203.1.2021) concerning the calculation of employee wages during justified absences (such as vacation or sick leave) for Research and Development (R&D) tax relief purposes (we wrote more about this topic in this article). This ruling has initiated certain actions by tax authorities that raise justified concerns among entrepreneurs.
For several months, we have been receiving information that the Director of the National Tax Information, based on the aforementioned general ruling, has begun a mass process of officially expiring individual rulings. The situation is particularly concerning because the Director is invalidating individual rulings issued several years ago in their entirety, not just in the parts relating to the issues resolved in the general ruling. Moreover, there are cases where individual rulings are being expired even when the taxpayer never raised questions about calculating R&D relief for employee wages during justified staff absences (which is what the general ruling addresses).
Such behavior by tax authorities is disadvantageous for taxpayers as it deprives them of legal protection related to using R&D relief based on individual rulings. It’s worth remembering that individual rulings, issued at the taxpayer’s request, previously provided security in case of potential tax audits. Their expiration means that taxpayers must independently prove that they conduct R&D activities and that they correctly utilized the relief.
It is worth noting that the Director’s actions may lead to situations where taxpayers, acting in reliance on previous individual rulings, made business or financial decisions that may now be challenged by tax authorities. Such changes in the authorities’ approach create financial and legal risks for entrepreneurs using R&D relief.
Given the above, it is crucial to file an appeal against the decision concerning the expiration of individual ruling, and in case of an unfavorable decision from the second instance tax authority – to file a complaint with the administrative court.
Importantly, timing is crucial in such cases – the deadline for filing an appeal is 7 days from the delivery of the notice.
