ACT ON PERSONAL INCOME TAX
Assignment of revenues from lease, tenancy and other contracts of a similar nature to the appropriate source of revenues in the PIT Act.
Supreme Administrative Court Resolution dated May 24, 2021, ref. no. II FPS 1/21
Income from lease (sublease), tenancy (subtenancy) and other contracts of a similar nature are included without limitation to the source of income listed in art. 10 sec. 1 point 6 of the Personal Income Tax Act (lease, sublease, tenancy, subtenancy and other similar agreements), unless they constitute an asset of a natural person, which was introduced by him to the property related to the economic activity performed.
The conditions for qualifying the sale of real estate to the source of income under Art. 10 sec. 1 point 3 of the Personal Income Tax Act, i.e. non-agricultural business activity.
Judgment of Provincial Administrative Court in Rzeszów dated January 14, 2021, ref. no. I SA/Rz 788/20.
According to the Provincial Administrative Court in Rzeszów, the intention to sell plots of land indicating its profit-making nature, i.e. with a focus on profit, organization, and thus acting in a methodical, planned, systematic and orderly manner, as well as undertaking activities aimed at increasing the attractiveness and real estate values through, among others taking action to obtain construction designs and building permits on plots of land is an action that should be qualified as a source of income under Art. 10 sec. 1 point 3 of the Personal Income Tax Act, i.e. non-agricultural business activity.
It should be borne in mind that the commented judgment of the Provincial Administrative Court in Rzeszów is of great importance for determining whether the sale of real estate can be taxed after the lapse of 5 years from the end of the year in which the real estate was acquired, and whether the expenses from the sale of such real estate can be allocated to the so-called “Own dwelling purposes”.
The judgment of January 14, 2021 means that: (i) income from the sale of the real estate, which will be characterized by the above-mentioned features, will be subject to income tax even if the sale of this property will take place 5 years after the end of the year in which the acquisition of the property took place, (ii) the taxpayer who made the sale in the manner presented by the Provincial Administrative Court in Rzeszów will not be able to take advantage of an exemption consisting in allocating the revenues obtained from the sale of the Real Estate to the so-called own dwelling purposes, i.e. he will not be able to obtain tax exemption if the proceeds from the sale of the Real Estate are used to purchase another real estate for his own dwelling purposes.
TAX ORDINANCE
Tax Ordinance does not require direct payment from a bank account in order for the tax liability to expire .
Judgment of Supreme Administrative Court dated April 14, 2021, ref. no. II FSK 3305/18.
According to the Supreme Administrative Court, the payment of tax by another person (third party) for the tax payer is only a factual action that is not prohibited by any norm of tax law.
In the opinion of the Court, in the current state of the law, the regulations resulting from the provisions of the Tax Ordinance (Article 60 § 1 point 2 of the Ordinance) only concern: (i) the date of payment and (ii) the form of payment of the tax, and thus do not require a direct payment from the payer’s bank account in order for the payer’s liability to expire.
ACT ON GOODS AND SERVICES TAX (VAT) / TAX ORDINANCE
Tax overpayment within the meaning of art. 74 (1) of the Tax Ordinance is not a refund of the difference in input tax over output tax.
Judgment of Supreme Administrative Court dated March 11, 2021, ref. no. I FSK 1102/20.
In the opinion of the Supreme Administrative Court, a request for reimbursement of the difference in input tax over output tax resulting from a taxpayer’s correction of input tax will not constitute an overpayment of tax in the meaning of Art. 74 point 1 of the Tax Ordinance.
THE ACT ON TAXES AND LOCAL FEES
Ownership of the title to the commercial premises does not prejudge that those appurtenances to the premises must be taxed at the same tax rate as the commercial premises.
Judgment of Supreme Administrative Court dated April 8, 2021, ref. no. III FSK 3017/21.
In the opinion of the Supreme Administrative Court, the fact that the share in the common parts of the building that belong to the entrepreneurs due to their ownership title to the commercial premises does not mean that these belongings will be taxed at the same tax rate as the commercial premises.
dr hab. Konrad Marciniuk
Partner
T: +48 22 447 43 00
M: +48 601 674 424
E: marciniuk@millercanfield.com
Disclaimer: This publication has been prepared for clients and professional associates of Miller Canfield, and is based on the facts and guidance available at the time of its release which may be subject to change. The purpose of the publication is to draw attention to the legal events indicated in it and should not be the sole basis for any decision regarding a particular course of action; nor should it be relied on as legal advice or regarded as a substitute for detailed advice in individual cases. The services of a competent professional adviser should be obtained in each instance so that the applicability of the relevant legislation or other legal development to the particular facts can be verified.