The obligation to introduce the Mandatory Disclosure Rules (MDR) results from Council Directive (EU) 2018/822 of 25 May 2018 (“Directive”). The Act introducing the obligation to report tax schemes (“Act”) has been in force since 1 January 2019 and, as such, has applied to tax schemes for which one of the events giving rise to the obligation to provide information occurred on that day or later. The objective scope of the Polish regulations is broader as it concerns not only cross-border schemes (as in the case of the Directive) but also domestic schemes. The Act also introduces transitional provisions. A cross-border tax scheme is subject to reporting if the first activity related to its implementation was carried out prior to the effective date of the Act, but not earlier than after
25 June 2018. Other tax schemes are subject to reporting if the first activity was carried out not earlier than after 1 November 2018.
Pursuant to the Act, a tax scheme is an arrangement having the hallmarks specified in the Act. A tax scheme is not tantamount to circumvention of tax law or tax optimisation. In addition, it applies to all taxes, including VAT. To a large extent, a tax solution including a tax advantage will result to be a tax scheme; however, this concept may also encompass other situations listed in the Act, including those related to asset transfers or non-transparent ownership structure.
The disclosure obligation arises where the arrangement concerned meets the conditions specified in the tax scheme definition, and for schemes other than cross-border schemes, the criterion of the eligible beneficiary must also be met. In the latter case, the disclosure obligation will not arise until one of the thresholds of the
eligible beneficiary criterion is exceeded. In addition to the above tax schemes and cross-border tax schemes, standardized tax schemes can also be distinguished. A tax scheme covers both a cross-border tax scheme and a standardized tax scheme and a cross-border tax scheme can also be a standardized tax scheme as a scheme is standardized if it can be implemented or made available for implementation to more than one beneficiary without the need to change its significant assumptions.
The obligation to provide information on tax schemes concerns three categories of entities: (i) a promoter, (ii) a beneficiary and (iii) a supporting entity. A tax advisor, attorney, legal advisor, employee of a bank or another financial institution advising clients can be a promoter. An entity may be assigned the promoter’s role if it offers, makes available, implements or manages the implementation of the arrangement. A beneficiary is an entity to which the arrangement is made available, at which the arrangement is implemented, or which is prepared to implement, or has performed an activity to implement the arrangement. A supporting entity is an entity that has agreed to provide, directly or through other persons, assistance, support or advice on the development, marketing, organisation, making available for implementation or supervision of the arrangement implementation, in particular a statutory auditor, public notary, an accountant or a financial officer.
A promoter and a beneficiary shall report a tax scheme within 30 days following the occurrence of one of the events specified in the Act. The deadline within which a supporting entity should comply with the MDR obligations depends on the type of obligation concerned and it is 5 or 30 days, respectively.