Author: kancelaria

A labour inspector’s decision establishing the existence of an employment relationship is not the same as a decision of the Social Insurance Institution concerning coverage by social insurance and the amount of contributions. These are two separate proceedings conducted under different statutes and by different authorities, although findings made by the inspector may constitute significant evidence in proceedings conducted by ZUS.

The provisions granting labour inspectors the power to issue decisions establishing the existence of an employment relationship have only just entered into force, so, as at July 2026, the practice of applying them is of course only taking shape. There is as yet no settled case law relating to the new regulations, which is why the statutory provisions and the existing case law of the Supreme Court concerning the conditions for the existence of an employment relationship retain fundamental significance.

This means that, in analysing the effects of the reform, one must rely above all on three pillars: the provisions of the new act on the National Labour Inspectorate (“PIP”), the Act on the Social Insurance System (“ZUS”), and the existing case law of the Supreme Court concerning the establishment of the existence of an employment relationship. The last of these will, paradoxically, be of the greatest significance in the coming years, because the reform did not change the definition of an employment relationship, only the authority and the procedure for establishing it. All the criteria developed by the Supreme Court for distinguishing genuine self-employment from a sham B2B contract remain applicable. Nor can one disregard the definition of business activity in the tax statutes, or the practice of the tax authorities and administrative courts in relation to B2B. All these sources form the ecosystem for operating safely in the sphere of B2B contracts.

 

The very title of this article, however, requires explanation, because it is very easy to create the mistaken impression that a PIP decision automatically leads to a decision being issued by ZUS. That is not the case. We are dealing with two separate sets of proceedings conducted by two different administrative authorities:

• The National Labour Inspectorate (PIP) makes findings concerning the existence of an employment relationship within the scope arising from the applicable provisions.
• ZUS independently assesses whether a given person is covered by compulsory social insurance and what the amount of the contributions due is.

A PIP decision therefore does not replace a ZUS decision and does not in itself yet give rise to contribution arrears, but for ZUS it constitutes extremely significant evidence. If ZUS obtains information about findings made by the National Labour Inspectorate, it may use the material gathered as evidence in the proceedings it conducts, but it still has an obligation to establish the facts independently and to carry out its own assessment of the evidence in accordance with the principle of free assessment of evidence. This is precisely why the PIP reform is of such great financial significance, even though it formally does not change the social insurance provisions.

 

From a PIP inspection report to a ZUS assessment decision – the financial domino mechanism

Findings made by a labour inspector, contained in the inspection report and in any administrative decision, do not in themselves give rise to contribution arrears. They may, however, be used by ZUS as evidence leading to the issuance of its own decision concerning coverage by social insurance and the amount of contributions. Only a ZUS decision may result in an obligation to pay outstanding contributions together with interest.

In public debate, the reform is most often presented as a change concerning labour law. From the perspective of a company’s management board, however, the greatest problem is not the obligation to conclude an employment contract, but the financial consequences that may emerge many months later.

This mechanism resembles a domino effect. A PIP inspection leads to the gathering of extensive evidence concerning the way the cooperation was carried out. The inspector then issues a decision concerning the existence of an employment relationship, and the information gathered may be used by ZUS in commencing its own proceedings.

One thing is worth emphasising very strongly: a PIP decision is not binding on ZUS in the formal sense. The Social Insurance Institution is obliged to establish the facts independently and to issue its own decision. This does not mean, however, that a PIP decision is without significance; in practice it will be one of the most important pieces of evidence in the entire proceedings.

Only a ZUS decision may lead to contribution arrears being established, interest being charged and further enforcement measures being initiated. From the point of view of an entrepreneur, and above all from the point of view of the management board and the finance director, it is precisely this moment that marks the beginning of real financial risk, which may materialise not on an individual scale, but across the entire group of contractors cooperating with the company.

It may be added in passing only that the financial risk will materialise not only in ZUS arrears, which are the subject of this article, but also in potential tax arrears, as described in more detail below.

 

ZUS proceedings on the redefinition of a B2B contract – how to protect the company against security over its assets?

An entrepreneur has the greatest influence on the outcome of the case not in court, but already at the stage of the investigative proceedings conducted by ZUS – that is where it is worth presenting material confirming the contractor’s genuine independence.

Most entrepreneurs focus on the final ZUS decision, whereas the most important stage of the proceedings takes place much earlier. That stage is the investigative proceedings.

In the course of the proceedings, ZUS is obliged to gather and consider all the evidence exhaustively. The authority may demand documents, question the parties and witnesses, and use other means of evidence provided for in the Code of Administrative Procedure, applied accordingly on the basis of the Act on the Social Insurance System. In practice the scope of the evidence is very broad, and it is precisely at this stage that the entrepreneur has the greatest opportunity to influence the outcome of the case.

From the perspective of managing the company’s liquidity, it is a mistake to treat the investigative proceedings as a formality and to postpone the arguments until the court stage. If coherent material confirming the contractor’s genuine independence is presented as early as this stage, there is a chance of concluding the case without an unfavourable decision being issued, which directly limits the financial risk for the company. Only after the investigative proceedings have been concluded does ZUS issue a decision concerning coverage by social insurance and the amount of contributions due.

A separate issue, crucial from the CFO’s perspective, is security over assets. The Social Insurance Institution may apply security for the performance of a liability only in the cases provided for in the provisions of the Act on the Social Insurance System and the Tax Ordinance applied accordingly. This requires demonstrating that the statutory conditions exist, in particular a justified concern that a future liability will not be performed. An entrepreneur’s aim should therefore be not so much to “avoid security” as to limit the risk of its being applied, through active participation in the proceedings and by demonstrating the company’s stable financial position.

 

Appealing against a ZUS decision step by step – deadlines and formal requirements in the fight for the company’s finances

An appeal against a ZUS decision is filed with the regional court, via the ZUS unit, within one month of service of the decision. Below is the full procedure step by step:

1. Check the date of service of the decision – the deadline for the appeal runs from that date.
2. Observe the one-month deadline – as a rule, the appeal must be filed within one month of service of the decision. Filing an appeal after the deadline may result in its rejection, unless the conditions provided for in the provisions that allow an appeal to be examined despite the deadline having been missed are met.
3. Direct the appeal to the competent regional court – the labour and social insurance division. An appeal against a ZUS decision is not filed with the President of ZUS or with any other administrative authority.
4. File the appeal via the ZUS unit that issued the decision – it is that unit which forwards it to the court.
5. Formulate specific pleas and indicate the provisions infringed, rather than merely stating in general terms that you disagree with the decision.
6. Present your own version of the facts together with the appropriate applications for evidence to be taken.
7. Assemble documents confirming how the cooperation was organised – in B2B cases the practice of the cooperation is more significant than the content of the signed contract itself.

 

Key pleas and arguments – how to defend a B2B contract effectively against redefinition as an employment relationship?

Entrepreneurs very often focus on showing that the parties deliberately chose the B2B model. From the court’s point of view, however, this is not a decisive argument – the objective circumstances in which the cooperation was carried out are far more significant. The strongest line of argument should demonstrate the entrepreneur’s genuine independence, in particular that the contractor:

• organised the manner of performing the services itself,
• bore the economic risk,
• invested its own funds,
• was responsible for the result of its work,
• could achieve either a profit or a loss,
• carried on business activity in its own name and at its own risk, and the fact that it also provided services to other entities may constitute an additional argument in favour of the entrepreneur’s independence, although it is not a condition for carrying on business activity,
• was not subject to the ongoing instructions of superiors and was not integrated into the enterprise’s organisational structure on the same terms as full-time employees.

 

The most common formal errors in appeals, which open the way for officials to collect contributions

The most common error is by no means missing the deadline for filing the appeal, although that of course has serious consequences. The most frequently encountered causes of an unfavourable outcome include:

• basing the entire line of argument solely on the content of the contract, even though ZUS and the courts examine above all the actual manner in which the cooperation was carried out,
• a passive stance at the stage of the investigative proceedings and postponing arguments until the court stage,
• omitting economic evidence – invoices, business correspondence, project documentation or evidence of bearing economic risk, which in B2B cases are often more significant than the contract itself.

 

A ZUS decision as a green light for a tax audit – how to stop losses escalating?

A ZUS decision does not automatically commence a tax audit, but in practice it may prompt the National Revenue Administration authorities to take an interest in the case.

It cannot be said that a ZUS decision automatically results in a tax audit being commenced, because the provisions do not provide for such a mechanism. In practice, a ZUS decision may prompt the National Revenue Administration authorities to take an interest in the case, but the provisions do not provide for the automatic commencement of a tax or customs and fiscal audit on that ground alone. Every set of tax proceedings requires a separate legal basis and its own findings of fact. If ZUS concludes that the cooperation was in reality an employment relationship, questions also arise as to the correctness of the tax settlements made by both parties.

The scope of the potential tax consequences will, however, depend on the specific cooperation model. In individual cases, issues may arise concerning PIT withholding agent obligations, the treatment of tax-deductible costs or VAT consequences. There is no single universal tax scenario for every B2B reclassification.

Effective risk management should not be limited to the appeal against the ZUS decision alone. For the management board and the finance director, it is far more important to prepare, in parallel, a strategy covering labour law, social insurance and taxes. Only such coordinated action makes it possible to limit the risk of multi-year disputes and of an accumulation of liabilities towards various state authorities. It is precisely this multidisciplinary nature of the problem that distinguishes an ordinary dispute with ZUS from a genuine legal and financial crisis within a business.

 

FAQ – Frequently asked questions

 

Does a PIP decision reclassifying a B2B contract automatically mean contribution arrears at ZUS?

No. A PIP decision and a ZUS decision are two separate sets of proceedings. A PIP decision is not binding on ZUS and does not replace its decision, but it constitutes significant evidence for ZUS in establishing whether an obligation to provide social insurance coverage has arisen.

 

How much time is there to appeal against a ZUS decision?

As a rule, the appeal must be filed within one month of service of the decision. Filing an appeal after the deadline may result in its rejection.

 

With which authority is an appeal against a ZUS decision filed?

The appeal is filed with the competent regional court, the labour and social insurance division, via the ZUS unit that issued the decision. It is not filed with the President of ZUS or with any other administrative authority.

 

Does a ZUS decision establishing an obligation to be covered by social insurance following a challenge to the B2B model lead to a tax audit?

Not automatically – the provisions do not provide for such a mechanism. In practice, however, a ZUS decision may prompt the National Revenue Administration authorities to take an interest in the case, especially as regards PIT withholding agent obligations and VAT settlements, with each set of tax proceedings requiring a separate legal basis and its own findings of fact.

 

When may ZUS establish security over a company’s assets in such proceedings?

Only where there is a real concern that the performance of a future liability will be hindered or impossible. Security is not applied automatically in every case – active participation in the investigative proceedings and demonstrating the company’s stable financial position limits that risk.

 

Sources

• Act of 11 March 2026 amending the Act on the National Labour Inspectorate and certain other acts (Journal of Laws of 2026, item 473) – sejm.gov.pl
• Act of 17 November 1964 – Code of Civil Procedure, consolidated text (Journal of Laws of 2026, item 468), Article 477(9) § 1 and § 3 – sejm.gov.pl
• Act of 13 October 1998 on the Social Insurance System, consolidated text (Journal of Laws of 2026, item 199), Article 83 – sejm.gov.pl
• Act of 26 June 1974 – Labour Code, consolidated text (Journal of Laws of 2025, item 277), Article 22 § 1 – sejm.gov.pl
• Ministry of Family, Labour and Social Policy, “Reform of the National Labour Inspectorate” – pl

 

Combining the R&D relief with IP Box is permissible and does not require choosing one of the two preferences. Each concerns a different element of the tax settlement, because the research and development relief reduces the tax base by the costs of the work, while IP Box allows income from the commercialisation of the intellectual property right created to be taxed at a rate of 5%. In practice, therefore, the risk does not concern the right to combine the two solutions as such, but the quality of the documentation.

What does using the R&D relief and IP Box at the same time involve?

Applying the R&D relief and IP Box simultaneously means that the taxpayer deducts the eligible costs of research and development work and then applies the 5% rate to the income from the qualified intellectual property right created as a result of that work.

The difference comes down to what each of the preferences relates to. The R&D relief, governed by Article 18d of the CIT Act and Article 26e of the PIT Act, covers costs. IP Box, that is Article 24d of the CIT Act and Article 30ca of the PIT Act, covers income. The preferences therefore relate to two different stages of activity and do not overlap.

Since 1 January 2022, Article 24d(9a) of the CIT Act has additionally been in force, together with its counterpart in Article 30ca(9a) of the PIT Act. The provision allows eligible costs that led to the creation, development or improvement of a qualified right to be deducted from the income derived from that right. This is currently the strongest basis for combining the two solutions, because it follows directly from the statute and not solely from interpretation.

Who can combine the research and development relief with IP Box?

Both preferences are available to CIT and PIT taxpayers that carry on research and development activity and derive income from a qualified intellectual property right created within that activity. Legal form is irrelevant here, so this applies both to a limited liability company and to a sole proprietorship.

In practice they are most frequently used by IT companies and software houses, because copyright in a computer program falls within the statutory catalogue of qualified intellectual property rights. The situation is similar in the games industry, where the subject of development work may be both the first version of a product and its subsequent modules and functionalities.

Meeting the conditions for one of the preferences does not, however, determine that the conditions for the other are met. The authority assesses each of them separately, on the basis of a distinct set of criteria.

It is also worth monitoring changes in the legislation. Draft proposals restricting access to IP Box for the smallest taxpayers have appeared before, and their legislative fate has proved variable.

How, step by step, to account for R&D and IP Box in relation to a single project?

Accounting for both preferences within one project requires three steps performed in a specific order: identifying the R&D activity, calculating the eligible costs, and calculating the income covered by the 5% rate.

Step 1: Identifying R&D activity and the creation of qualified IP

The starting point is establishing that the work satisfies the statutory definition of research and development activity, that is that it is creative in nature and carried out systematically, and that its result is a qualified intellectual property right.

For technology companies this most often means a computer program as the qualified IP, protected by copyright. At this stage it is worth describing each project separately: what problem it solved, what the creative element consisted in, and what the result of the work was. Interpretative practice indicates that development activity does not end at the moment the first version of a product is created, and that its subsequent development stages may also satisfy the statutory criteria, provided they do not amount to routine and periodic changes.

Step 2: Calculating the eligible costs (R&D relief)

The second step is to establish which expenses fall within the catalogue of eligible costs set out in Article 18d(2)-(3) of the CIT Act. The catalogue is closed, so not every cost connected with the project is deductible.

The least doubt is usually raised by the remuneration of the persons carrying out the work, together with social security contributions, in the part corresponding to their involvement in R&D activity. More disputes concern indirect expenses. In the ruling of 23 September 2024 (ref. 0114-KDIP2-1.4010.344.2024.3.PP), the Director of the National Revenue Information Service confirmed the possibility of using both preferences while at the same time narrowing the catalogue of eligible costs, among other things in relation to part of the expenditure on a car, licences, subscriptions and accounting and advisory services.

Step 3: Calculating IP Box income taking the nexus ratio into account

The third step is to establish the income from the qualified right and multiply it by the nexus ratio. Nexus is a proportion showing what part of the work on a given right the taxpayer performed itself and what part it purchased from others. The more it did itself, the greater the part of the income that can be covered by the 5% rate.

The formula, set out in Article 24d(4) of the CIT Act, compares the costs of work carried out directly by the taxpayer with the costs outsourced to external entities and with expenditure on the purchase of a ready-made right. The last of these operates least favourably, and the result may not exceed 1. The calculation is carried out separately for each qualified right.

Financial benefits – by how much does the effective tax rate actually fall?

The IP Box preference reduces the rate from 19% or 9% to 5% in relation to qualified income. The actual effective tax rate depends, however, on what part of the income passes the nexus test, and not on the nominal difference between the rates.

The scale of the benefit therefore depends on the structure of the project. For a taxpayer carrying out work almost exclusively with its own team, the nexus ratio may be close to 1, in which case almost all of the income from the qualified right is subject to the 5% rate. For a taxpayer relying largely on subcontractors, only part of the income will be covered by the preference, and the remaining part will continue to be taxed under the general rules. By way of illustration: with a nexus ratio of 0.6 and a basic rate of 19%, the blended rate on income from the qualified right is 10.6%, because 60% of the income is subject to the 5% rate and the remaining 40% to the general rules.

Added to this is the effect of the R&D relief, which under Article 24d(9a) of the CIT Act may also reduce income taxed at the 5% rate. A separate issue remains capital groups covered by the global minimum tax, where the effective rate is determined at the level of the entire jurisdiction rather than of an individual company. The overall benefit therefore has to be calculated individually, on the data for the specific tax year.

The most common errors and risks in applying both preferences in parallel

The most common error is not the combination of the preferences itself, but treating remuneration for services as income from a qualified intellectual property right. The 5% rate applies solely to income from qualified IP, and not to the entire remuneration obtained in connection with research and development activity.

The order matters here. First a qualified right must come into existence, and then the taxpayer must derive income from that very right, in one of the forms indicated in the statute. This distinction was highlighted by the Provincial Administrative Court in Szczecin in its judgment of 25 February 2026 (ref. I SA/Sz 574/25).

The other typical risks are the incorrect allocation of costs to individual rights, errors in calculating the nexus ratio, and too broad an understanding of creative activity. A separate question, still giving rise to disputes, is the permissibility of recognising the same cost twice, that is in a deduction from income from qualified IP and, in parallel, from income taxed under the general rules. The tax authorities have approached this question differently from the administrative courts, which is why it is worth considering an application for an individual tax ruling in this respect.

How to prepare safe tax records for R&D and IP Box?

Safe records are records that make it possible to reconstruct the entire settlement path: from the specific work, through the costs, to the income allocated to an individual qualified right. Gaps in the records are the most frequent reason for a settlement being challenged.

In practice, the IP Box records and the R&D relief records should together demonstrate:

• which projects and tasks constituted research and development activity,
• which costs were recognised as eligible under the R&D relief,
• which qualified intellectual property rights arose as a result of that work,
• what revenues and costs are attributable to each of those rights,
• how the nexus ratio was calculated for each right.

The records are best kept on an ongoing basis, in parallel with the projects, rather than reconstructed after the end of the tax year. Reconstruction in hindsight is more difficult evidentially and usually no longer allows a missing description of the work to be supplied.

How ALTO Advisory supports the settlement of the R&D relief and IP Box in Poland

Combining both preferences is feasible, but each project and each qualified right has to be assessed separately. ALTO’s tax advisers help technology companies through this process: from a review of projects, through calculations, to the preparation of documentation.

It is worth turning to an adviser for support if:

• you are applying both preferences for the first time and want to confirm the classification of the work,
• part of the work is carried out by subcontractors or related entities, which affects the level of the nexus ratio,
• the settlement covers several qualified rights to which revenues and costs have to be allocated,
• the records were created late or do not cover all of the required elements,
• you are considering an application for an individual tax ruling on a question where the authorities’ practice is not uniform.

Sources

• Act of 15 February 1992 on Corporate Income Tax, Article 18d, Article 24d(4) and Article 24d(9a) (ISAP, isap.sejm.gov.pl).
• Act of 26 July 1991 on Personal Income Tax, Article 26e and Article 30ca(9a) (ISAP, isap.sejm.gov.pl).
• Individual tax ruling of the Director of the National Revenue Information Service of 23 September 2024, ref. 0114-KDIP2-1.4010.344.2024.3.PP (Eureka database, eureka.mf.gov.pl).
• Judgment of the Provincial Administrative Court in Szczecin of 25 February 2026, ref. I SA/Sz 574/25 (Central Database of Administrative Court Rulings, orzeczenia.nsa.gov.pl).

In recent months, several judgments have appeared in the case law of the provincial administrative courts that may cause concern among taxpayers benefiting from the R&D relief. In these rulings, the courts devoted considerably more attention to documenting research and development activity than had previously been the case.

Does this mean that taxpayers should prepare for new, more stringent documentation obligations? In our assessment – no. These judgments do, however, constitute an important signal that proper documentation of R&D activity may play a key role in the event of a dispute with the tax authorities.

 

Increasingly high court expectations regarding R&D documentation

Recently, two rulings of the Provincial Administrative Court in Poznań deserve particular attention – of 10 February 2026 (ref. I SA/Po 683/25) and of 24 April 2026 (ref. I SA/Po 277/26), as well as the judgment of the Provincial Administrative Court in Łódź of 17 June 2025 (ref. I SA/Łd 208/25). Although they were delivered against different factual backgrounds, all of them point to a markedly more stringent approach to assessing documentation of research and development activity.

It follows from the reasoning of these rulings that the courts expect taxpayers in particular to:

• document the course of the work in a manner allowing its systematic character to be demonstrated, rather than merely presenting the final results of the project,
• demonstrate the objective of the project, the technical or research problem identified and the method adopted to solve it, together with a description of the difficulties and risks encountered,
• present evidence confirming the actual course of the R&D work,
• demonstrate that the documentation was not prepared solely for the purposes of the tax proceedings, but reflects the way the projects were conducted while they were being carried out,
• prove the creative character of the work carried out, going beyond the use of available technologies and standard industry knowledge.

The rulings analysed therefore show that the courts attach ever greater importance not only to the result of the work itself, but also to the possibility of reconstructing the entire process leading to its achievement. The question therefore arises whether all these expectations find support in the applicable provisions.

 

What do the provisions actually say?

An analysis of the most recent case law leads to a fundamental question: do the applicable provisions in fact impose on taxpayers an obligation to maintain documentation to the extent expected by some administrative courts?

In our assessment – no. The provisions on the R&D relief require the taxpayer to demonstrate that the activity carried out meets the statutory conditions for research and development activity, but they do not specify how this is to be done.

The provisions governing the R&D relief do not contain a catalogue of documents that a taxpayer should hold in order to benefit from the preference. The legislator does not use terms such as “project card”, “schedule” or “project implementation report”. Nor does it specify the required manner of documenting working time or the course of the individual project stages.

The only documentation obligation arising directly from the provisions is the separation of the costs of research and development activity within the accounting records maintained (Article 9(1b) of the CIT Act).

This does not, however, mean that the taxpayer need not have evidence confirming that R&D activity is being carried out. It only means that the statute does not impose its form.

 

An obligation to demonstrate circumstances is not the same as an obligation to maintain specific documentation

This distinction also follows from the provisions of the Tax Ordinance. Under Article 180 § 1 of the Tax Ordinance, anything that may contribute to clarifying the case and is not contrary to law is to be admitted as evidence. In turn, under Article 191 of the Tax Ordinance, the tax authority assesses the entirety of the evidence gathered.

The provisions do not give priority to particular types of documents, nor do they make entitlement to the relief conditional on holding specific project documentation. The fulfilment of the conditions for R&D activity may be demonstrated by various means of evidence – from technical documentation, through project correspondence, test results and research protocols, to documents functioning within the enterprise independently of the R&D relief.

It is undoubtedly the taxpayer that bears the burden of demonstrating that it carries on research and development activity, incurs eligible costs connected with that activity and maintains separate records allowing them to be identified. The legislator has not, however, determined how these obligations are to be fulfilled. This means that the taxpayer may use various means of evidence, provided that together they allow the statutory conditions to be shown as met.

In this context, equating the obligation to prove that the conditions for R&D activity have been met with an obligation to maintain documentation in a specific form raises material doubts.

 

Interpretative and judicial practice to date

Attention was initially focused on the obligation to maintain separate records of eligible costs arising from Article 9(1b) of the CIT Act. Both the administrative courts and the tax authorities consistently took the view that this provision imposes on the taxpayer an obligation to separate the costs of R&D activity, while at the same time leaving it free to decide how to fulfil that obligation.

The Provincial Administrative Court in Olsztyn, in its judgment of 15 January 2025 (ref. I SA/Ol 451/24), indicated that the accounting records should make it possible to determine precisely the amount of the eligible costs and the period to which they relate. The Supreme Administrative Court, in turn, in its judgment of 19 December 2023 (ref. II FSK 1415/22), emphasised that the legislator has not specified the manner of separating the costs of R&D activity, leaving taxpayers free to choose solutions allowing their correct identification.

The Director of the National Revenue Information Service has for years presented the same position. In the ruling of 2 June 2025 (ref. 0111-KDIB1-3.4010.204.2025.2.JG) it indicated that the provisions do not specify the form of cost separation or minimum requirements for the records maintained. The ruling of 14 March 2024 (ref. 0114-KDIP2-1.4010.75.2024.1.AZ), in turn, emphasised taxpayers’ autonomy in choosing the manner of separating costs, while the ruling of 24 June 2024 (ref. 0114-KDIP2-1.4010.186.2024.4.AZ) confirmed that the obligation arising from Article 9(1b) of the CIT Act may also be fulfilled by maintaining auxiliary records in the form of Excel spreadsheets.

The tax authorities consider the documenting of the course of research and development activity itself far less frequently. In this respect, guidance can be found primarily in the tax explanations of the Minister of Finance concerning IP Box of 15 July 2019. The Minister indicated that the records of an R&D project should include in particular a description of the project, its start and end dates, a list of the persons involved in carrying it out and a summary of the work performed, assigned to specific team members. As an example of how to document employee involvement, the maintenance of working time records, for instance in a spreadsheet, was indicated.

Interpretative practice takes a similar shape. An analysis of individual tax rulings leads to the conclusion that the tax authorities view the maintenance of R&D project cards positively as an element of documenting research and development activity. At the same time, it is difficult to find decisions from which it would follow that maintaining them constitutes an obligation arising from the provisions. Project cards are most often described by the applicants themselves as an organisational tool they use, and the Director of the National Revenue Information Service accepts such a manner of documentation as an element of the factual circumstances presented, without deriving from the provisions an obligation to maintain documentation in that form.

The case law, the rulings of the Director of the National Revenue Information Service and the Minister of Finance’s explanations therefore all lead to a common conclusion. The legislator requires the taxpayer to demonstrate that it carries on research and development activity, incurs eligible costs and maintains separate records allowing them to be identified, but it does not impose a single model for documenting these circumstances. What is of key importance is the ability to demonstrate the link between the costs incurred and the R&D activity, and not the maintenance of documentation according to a single, statutorily prescribed template.

 

Maintaining documentation on an ongoing basis

Notably, one of the recent rulings (I SA/Łd 208/25) put forward the view that there is an obligation to maintain documentation for the purposes of the R&D relief on an ongoing basis. This position does not, however, follow from the provisions. Moreover, the tax acts allow a CIT return to be corrected and the R&D relief to be claimed retrospectively, which in practice is a common way of recovering overpaid tax. It is therefore difficult to accept that a taxpayer would be obliged to maintain documentation on an ongoing basis, given that the legislator has not introduced such a requirement and at the same time has provided for the possibility of benefiting from the tax preference at a later date.

 

Summary

The most recent case law of the provincial administrative courts shows that documenting R&D activity will play an increasingly important role in tax disputes. This does not, however, mean the introduction of new documentation obligations. What remains crucial is gathering evidence allowing it to be demonstrated that research and development activity is being carried out, and correctly separating the eligible costs. From a practical point of view, it is worth ensuring that documentation is created on an ongoing basis and makes it possible to reconstruct the course of the work and to link the costs incurred with specific R&D projects.

The PPWR (Packaging and Packaging Waste Regulation) governs the design, labelling and placing on the market of packaging throughout the European Union. From 12 August 2026, some of its provisions apply directly, without any need for transposition into Polish law. We explain who PPWR applies to, which obligations have already entered into force and which are still to come, and how to prepare your company for them.

 

Would you like to check where to begin your PPWR preparations? Ask us about the PPWR Scanner and take advantage of an expert assessment prepared by our ESG team. We will help you identify obligations, potential risks and areas requiring action in connection with the new PPWR requirements.

 

What PPWR is and why it replaces the previous directive

PPWR stands for the Packaging and Packaging Waste Regulation, that is Regulation (EU) 2025/40 of the European Parliament and of the Council on packaging and packaging waste. Unlike the earlier Directive 94/62/EC, which it replaces, PPWR applies directly in all Member States, with no need for transposition into national law.

This distinction has practical significance. A directive set out objectives, and each state determined for itself in its own legislation how to achieve them, which led to differences between national markets. A regulation works differently: its provisions apply directly, from the date indicated in the act itself. For companies this means a single, common set of requirements regardless of the EU country in which they sell a packaged product.

The main objective of PPWR is to reduce the volume of packaging waste and accelerate the transition to a circular economy, that is an economic model in which materials circulate for as long as possible instead of going to landfill after a single use. The Regulation covers the entire life cycle of packaging: design, production, placing on the market, labelling, as well as collection and recycling after use.

 

When PPWR applies – timeline of entry into force

The PPWR entered into force on 11 February 2025, but its provisions only begin to apply from 12 August 2026. This does not, however, mean that all obligations start on the same day, because some of them have been spread over 2028, 2029, 2030 and subsequent years.

The key dates in the legislative process are as follows:

1. 19 December 2024. The European Parliament and the Council adopted the final text of the Regulation.
2. 22 January 2025. Publication in the Official Journal of the European Union as Regulation (EU) 2025/40.
3. 11 February 2025. Entry into force; the eighteen-month vacatio legis, that is the transitional period before the provisions begin to apply, runs from this date.
4. 12 August 2026. General date of application of the Regulation.

It is worth distinguishing between these last two dates. Entry into force means that the act formally exists in the EU legal order, but its provisions are not yet binding on companies. The date of application is the moment from which the requirements must actually be complied with.

On 5 June 2026 the European Commission published a notice containing interpretative guidance on PPWR (C(2026) 3702 final), supplemented by a set of answers to frequently asked questions. The guidance helps to apply the provisions uniformly across the Union, but does not itself amend or replace them. A binding interpretation of EU provisions may be issued only by the Court of Justice of the European Union, in short the CJEU.

 

Who PPWR applies to – manufacturer, producer, importer, distributor and others

PPWR applies to every entity participating in the packaging supply chain: companies designing or ordering packaging under their own brand, companies placing a packaged product on the market of a given country, importers from outside the EU, distributors, fulfilment service providers, and even online platforms. Which role a given company plays determines the scope of its obligations.

The Regulation uses several concepts that are frequently confused in practice, even though they entail different obligations.

A single company may play several of these roles at the same time, depending on the type of packaging and the stage at which it participates in the supply chain. That is why the first step in assessing whether PPWR applies to a given company should be to analyse separately each category of packaging that the company uses.

 

What packaging means under PPWR

Packaging within the meaning of PPWR is any item used to contain, protect, handle, deliver or present a product, regardless of the material from which it is made. The definition is deliberately broad and covers not only typical boxes or films, but also labels, tea bags and coffee machine capsules.

Annex I to the Regulation contains an indicative list of items regarded as packaging and of items that are not packaging. The Commission stresses in its guidance, however, that the mere appearance of an item on that list does not settle the matter. It is always necessary to check whether the item corresponds to the elements of the definition in the Regulation, that is whether it serves to contain, protect, handle, deliver or present a product to another entity without being an integral part of it.

A few examples from the guidance illustrate well how non-obvious this classification can be. A flower pot is packaging where it is used to sell and transport a plant, but it is not packaging where a nursery uses it solely in the cultivation process. Infusion bags and syringes, even when pre-filled with a medicine, are not packaging, because they form an integral part of a medical device. Containers for grave candles are expressly excluded from the definition in Annex I. Determinations of this kind must be assessed separately for each product, because classification is decided by the function and the intention with which the item is placed on the market, and not by its appearance or name alone.

 

The key obligations from 12 August 2026

From 12 August 2026, the provisions that begin to apply include limits on harmful substances in packaging and the requirement to carry out a conformity assessment and draw up technical documentation together with an EU declaration of conformity. This is the first stage of PPWR implementation, though not the only one and not the largest in terms of the number of requirements.

From that date, packaging intended to come into contact with food may not contain PFAS, that is per- and polyfluoroalkyl substances, also referred to as forever chemicals, above the established thresholds. The Regulation provides for several limit values depending on the test method.

In parallel, a limit on heavy metals applies: the total sum of the concentrations of lead, cadmium, mercury and hexavalent chromium in the packaging may not exceed 100 mg/kg. This requirement is carried over from the previous directive, so companies that already complied with it should above all update their technical documentation with a reference to the new Regulation.

From 12 August 2026, a general requirement that packaging placed on the market be recyclable also begins to apply, although for now without detailed, binding technical criteria; these will enter into force only in 2030. The manufacturer must also carry out a conformity assessment procedure and, on that basis, draw up an EU declaration of conformity based on technical documentation confirming compliance with the requirements applicable at the given time.

 

Which obligations will enter into force later – recyclability, labels, deposits

Most of the detailed PPWR requirements, including the full recyclability criteria, harmonised labels and the empty space limit in parcels, will only begin to apply between 2028 and 2040. Companies therefore still have time to adapt their processes, provided they start acting in advance.

The timeline for the subsequent stages is as follows:

1. By 12 February 2027. The Commission is to request the European standardisation organisations to develop a methodology for calculating compliance with the packaging minimisation requirements.
2. By 1 January 2028. A delegated act is planned setting out detailed criteria for design for recycling.
3. From 12 August 2028. Or 24 months from the entry into force of the relevant implementing act, packaging is to bear a harmonised label facilitating sorting.
4. From 1 January 2029. Member States must ensure the separate collection of at least 90 per cent of single-use plastic bottles and metal beverage cans with a capacity of up to three litres, which in practice requires the introduction of a deposit return scheme. A country may obtain an exemption from this obligation if it already achieves a collection rate of 80 per cent in 2026 and notifies the Commission by 1 January 2028.
5. From 12 February 2029. Or 30 months from the implementing act, labels will also cover reusable packaging.
6. From 1 January 2030. The following begin to apply at the same time: the full recyclability criteria, the requirement to minimise the weight and volume of packaging to the necessary minimum, a maximum 50 per cent share of empty space in grouped, transport and e-commerce packaging, a ban on placing selected single-use plastic packaging formats on the market, and a reuse target reaching 40 per cent for most transport packaging.
7. From 1 January 2035. The requirement for packaging to be recycled at scale will be specified in more detail.
8. From 1 January 2040. An indicative, non-binding target of achieving a 70 per cent share of reusable packaging in transport is envisaged.

The empty space limit is of particular significance for e-commerce, because it applies directly to packaging intended for electronic commerce, alongside grouped and transport packaging. The Commission is to set out the precise methodology for calculating this indicator in an implementing act.

Consequences of non-compliance with PPWR

Packaging that does not comply with PPWR may not be placed on the EU market, and market surveillance authorities may demand its withdrawal. The level of financial sanctions for infringements is, however, set by the individual Member States in their own legislation, which in Poland is still going through the legislative process.

Under Article 4 of PPWR, Member States may not prohibit or restrict the placing on the market of packaging that meets the requirements of the Regulation. They may, however, maintain or introduce additional national sustainability requirements, provided that these do not conflict with EU provisions. Compliance is enforced by the national market surveillance authorities, which may, depending on the scale of the infringement, demand the withdrawal of non-compliant packaging from the market, prohibit its further availability, or refer the matter for further proceedings.

The specific amounts of administrative penalties that Polish companies may face depend on the act implementing PPWR into the national legal order, which as at the date of publication of this article has not yet been enacted. Until it enters into force, companies should treat PPWR compliance above all as a condition for the lawful sale of a packaged product on the EU market, and not solely as a financial risk.

 

How to prepare your company for PPWR – practical steps

It is worth starting PPWR preparations by establishing your own role in the packaging supply chain, because it is that role which determines the scope of your obligations. The next step is an audit of the packaging used against the substance limits, and a conversation with suppliers about the available material documentation.

In practice, it is worth splitting this into several stages:

1. Establishing the role for each packaging category. The same company may be the manufacturer of some packaging and the producer or distributor of other packaging, which is why the analysis must be carried out separately for each type of packaging in the portfolio, taking into account the various business streams.
2. An audit of packaging for PFAS and heavy metals. It is worth collecting material documentation from suppliers before 12 August 2026, rather than waiting for an inspection.
3. Collecting documentation from suppliers. Suppliers of packaging materials should confirm the chemical composition of the raw materials, with test results where necessary.
4. Preparing technical documentation and the EU declaration of conformity. This concerns above all companies acting as the manufacturer within the meaning of the Regulation.
5. Tracking implementing and delegated acts. The detailed criteria for recyclability, labelling and calculating empty space are still being developed, so it is worth monitoring their publication in 2027 and 2028.
6. Registration in extended producer responsibility schemes. Companies acting as the producer must register and report data in the country in which the packaging first reaches the market.

Companies that begin this process in advance will avoid a situation in which a change to packaging design in the middle of the sales season forces costly and hurried corrections.

 

 

Would you like to check where to begin your PPWR preparations? Ask about the PPWR Scanner and take advantage of an expert assessment prepared by our ESG team. We will help you identify obligations, potential risks and areas requiring action in connection with the new PPWR requirements.

 

 

FAQ: Frequently asked questions about PPWR

 

How does PPWR differ from the former packaging directive 94/62/EC?

The directive required transposition into the law of the individual EU countries, which led to differences between markets. PPWR, as a regulation, applies directly and uniformly in all Member States, with no need to enact separate national legislation.

 

Does PPWR ban the use of plastic packaging?

No. The Regulation does not introduce a general ban on plastics in packaging. It only restricts selected single-use packaging formats listed in Annex V, from 2030, and imposes requirements concerning recyclability, recycled content and the reduction of excess material.

 

Is a microenterprise also subject to PPWR obligations?

As a rule yes, but the Regulation provides for an exception in the definition of manufacturer. If the company commissioning the design of packaging under its own brand is a microenterprise and the packaging supplier operates in the same Member State, it is the supplier, and not the commissioning party, that is regarded as the manufacturer within the meaning of PPWR.

 

Does packaging placed on the market before 12 August 2026 have to be withdrawn or replaced?

According to the FAQ of August 2026, packaging that has not been placed on the market by 12 August 2026 but has already been produced and is held in a warehouse does not have to be destroyed, re-manufactured or re-labelled.

In order to meet the requirements set out in Article 15(5) and (6), under which packaging must bear a unique identifier and the name and address of the manufacturer, the required information may be provided in a document accompanying the packaging. This also applies to reusable packaging that has already been placed on the market.

However, in the case of packaging produced after 12 August 2026, an accompanying document may be used only where the nature or size of the packaging makes it impossible to place the unique identifier and the name and address of the producer directly on the packaging.

Packaging that was placed on the market before 12 August 2026 may remain on the market even if it does not comply with the PPWR requirements.

 

Can a branch of a foreign company in Poland act as an importer within the meaning of PPWR?

According to the European Commission’s guidance, no, because a branch does not have separate legal personality. To act as an importer, a foreign company must have a subsidiary in Poland with its own legal personality or designate an authorised representative.

 

Does PPWR apply uniformly in all EU countries?

The basic requirements do, because the Regulation operates directly and without national transposition. Member States nevertheless retain a certain margin of discretion; for example, they may introduce additional national requirements concerning compostability or higher recycling targets, provided that these do not conflict with EU provisions and do not create barriers in the internal market.

 

How ALTO Advisory supports companies in implementing PPWR

The scope of our services includes in particular:

• identifying the company’s roles under PPWR (manufacturer, importer, distributor, fulfilment service provider, producer and others),
• mapping packaging and product flows within the organisation,
• classifying packaging and analysing the obligations applicable to individual packaging categories,
• carrying out gap analyses and developing PPWR adaptation plans,
• support in preparing declarations of conformity, technical documentation and conformity assessment procedures,
• developing policies, procedures and operating instructions supporting the fulfilment of PPWR obligations,
• training for management boards and operational teams,
• ongoing expert advice during implementation and monitoring of regulatory developments.

 

 

 

Would you like to check where to begin your PPWR preparations? Ask about the PPWR Scanner and take advantage of an expert assessment prepared by our ESG team. We will help you identify obligations, potential risks and areas requiring action in connection with the new PPWR requirements.

 

 

 

Sources

1. Regulation (EU) 2025/40 of the European Parliament and of the Council of 19 December 2024 on packaging and packaging waste, amending Regulation (EU) 2019/1020 and Directive (EU) 2019/904, and repealing Directive 94/62/EC (OJ L, 2025/40, 22.1.2025)
2. European Commission notice: Guidance on Regulation (EU) 2025/40 on packaging and packaging waste, Brussels, 5.6.2026, C(2026) 3702 final
3. Directive 94/62/EC of the European Parliament and of the Council of 20 December 1994 on packaging and packaging waste (OJ L 365, 31.12.1994, p. 10), repealed by Regulation (EU) 2025/40
4. European Commission, Directorate-General for Environment, Packaging and Packaging Waste Regulation (PPWR). Frequently Asked Questions, 2nd ed., Publications Office of the European Union, Luxembourg 2026

 

 

Your company pays for a patent licence, interest on an intra-group loan, remuneration for management services and a dividend to its parent company. Each of these payments triggers two theoretically independent regimes: withholding tax and transfer pricing. You settle and document them separately, but they are based on the same facts, and the authority reads them together.

In companies forming part of capital groups – and pharmaceutical companies are usually among them – payments of this kind are practically an everyday occurrence. At the same time, however, they are among the areas most frequently and most meticulously scrutinised by the tax authorities.

 

Key takeaways

• The domestic WHT rate is 20 per cent for receivables under Article 21(1) of the CIT Act and 19 per cent for dividends under Article 22(1).
• The exemption for interest and royalties covers only the amount corresponding to arm’s length conditions. Any excess resulting from the relationship does not benefit from the preference (Article 21(7) of the CIT Act).
• Article 22 of the CIT Act contains no provision structurally corresponding to Article 21(7). In the case of dividends, the risk is assessed differently, primarily through Article 22c (the so-called minor anti-avoidance clause).
• The pay and refund mechanism applicable once PLN 2 million is exceeded covers receivables under Article 21(1)(1) and Article 22(1). Intangible services under Article 21(1)(2a) do not fall within this catalogue.

 

Which foreign payments made by a pharmaceutical company are subject to withholding tax?

It all begins with two statutory catalogues. The first, set out in Article 21(1)(1) of the CIT Act, covers interest, copyright and related rights, rights to inventive designs, trademarks and ornamental designs, the sale of those rights, receivables for making available a secret formula or production process, the use of industrial, commercial or scientific equipment, and know-how. The domestic rate here is 20 per cent. Separately, in Article 21(1)(2a), the legislator lists advisory, accounting, market research, legal, advertising, management and control, data processing and recruitment services, guarantees and sureties, as well as services of a similar nature.

The second catalogue, set out in Article 22(1), concerns dividends and other income from participation in the profits of legal persons. In this case the rate is 19 per cent.

These are the domestic rates, not the rates actually withheld. In order to apply the rate provided for in a double tax treaty or to apply a statutory exemption, you need a certificate of residence and you must exercise due diligence (Article 26(1) of the CIT Act). Its assessment takes into account the nature and scale of your activity (as well as, in practice, the activity of the entire group) and the relationship with the recipient. The Act does not define due diligence, so do not count on a closed list of documents that will always ensure it.

 

Why does the licence fee rate determine both transfer pricing and withholding tax at the same time?

A licence fee for a patent, trademark or know-how is a receivable under Article 21(1)(1) of the CIT Act and, at the same time, a controlled transaction whose price should correspond to arm’s length conditions (Article 11c). Both obligations meet in a single provision.

Article 21(7) of the CIT Act operates as follows: if, as a result of the relationship, the conditions differ from those that would have been agreed by independent entities, and the amount of the receivable is higher than would have been expected in the absence of that relationship, the exemption applies only to the amount corresponding to the arm’s length level. A non-arm’s length royalty rate therefore entails not only the risk of an income adjustment, but also an exemption narrower than the amount you actually paid.

The second question is: which entity in the group is economically entitled to the income from the intangible asset. The 2022 OECD Transfer Pricing Guidelines answer this through an analysis of DEMPE functions, that is development, enhancement, maintenance, protection and exploitation. Legal ownership of title to a patent does not in itself determine the remuneration. In the local file, this corresponds to the requirement to describe the analysis of functions, risks and assets (Article 11q(1) of the CIT Act).

 

What has to be established in relation to interest on an intra-group loan beyond the interest rate?

Interest falls within Article 21(1)(1) of the CIT Act and, on the transfer pricing side, is subject to an arm’s length assessment. It is necessary to prepare a reliable and complete benchmark confirming that the method of calculating the interest has been set on arm’s length terms. Sometimes even more detailed analyses are required, consisting in an assessment of whether the company’s overall level of “indebtedness” is at arm’s length – in short, whether a company operating on the market would in fact be able to take out such a large loan and continue to function (the so-called debt capacity analysis).

The legislation also provides for certain documentation simplifications, for example the safe harbour, where the interest rate falls within the parameters of the minister’s announcement.

The safe harbour, however, only simplifies the TP documentation issue. It does not release you from examining the status of the recipient of the interest, it does not replace the assessment of borrowing capacity and it has no effect on the debt financing cost limit under Article 15c of the CIT Act, which you calculate independently.

 

When does the exemption for a dividend paid to a parent company not apply?

The exemption under Article 22(4) of the CIT Act requires, among other things, that the recipient be a company subject to tax on its entire income in a European Union or European Economic Area state, holding directly at least 10 per cent of the shares for the required period and not benefiting from an exemption covering all of its income.

Irrespective of those conditions, Article 22c of the CIT Act applies, which excludes the preference where benefiting from it would be contrary to the subject matter or purpose of the provisions on the exemption or where it constituted the main purpose of the transaction and the manner of acting was artificial.

The case law is consistent on this point: as the payer of the dividend, you cannot confine yourself to formal documents, you must also examine whether the payment of the dividend is consistent with the company’s function within the group and does not lead, in short, to tax optimisation. This was indicated by, among others, the Supreme Administrative Court in its judgment of 6 October 2023 (II FSK 1333/22), referring to the case law of the CJEU in the Danish cases of 26 February 2019.

 

How should intangible services from headquarters and research services be classified?

The order of the analysis is the reverse of the intuitive one. First you check whether the service falls within the catalogue set out in Article 21(1)(2a) of the CIT Act, and only then do you turn to the double tax treaty. If the remuneration constitutes the business profit of a non-resident enterprise without a permanent establishment in Poland, no tax may arise.

The greatest scope for dispute concerns services of a similar nature. The test developed by the Supreme Administrative Court in its judgment of 5 July 2016 (II FSK 2369/15) requires that the features of the services listed in the provision prevail over the features of a service not listed there. The intangible nature of a service alone is not sufficient.

On the transfer pricing side, the same services require demonstrating an actual benefit for the service recipient and justifying the cost allocation keys.

 

Who is the beneficial owner of royalties and interest?

The definition in Article 4a(29) of the CIT Act requires three elements jointly. The recipient receives the payment for its own benefit, independently decides on its use and bears the economic risk of losing it. It is not an intermediary, representative, trustee or an entity obliged to pass the payment on. It carries on genuine business activity, assessed accordingly under Article 24a(18).

The tax explanations issued by the Minister of Finance on 3 July 2025 and published on 9 July 2025 add an important indication to this: the required asset and personnel base must be adequate to the type of activity carried on. Different expectations apply to a manufacturer, different ones to a research and development centre, and different ones to a holding company. The absence of an in-house laboratory therefore does not in itself determine the absence of genuine activity.

In practice, during audits the authorities often set very high requirements before accepting that the taxpayer (the recipient of the payment) is the beneficial owner. Sometimes the requirements of the auditing authority are in fact higher than what follows from the Ministry of Finance’s explanations. That is why it is so important to develop a specific strategy for conducting the tax or customs and fiscal audit. It is critical that the arguments of the audited company supporting the correctness of its settlements be consistently raised and documented from the outset of the case.

 

What does an audit of withholding tax and transfer pricing look like?

What is extremely important, both areas are among the audit priorities of the tax administration. Withholding tax is examined primarily with regard to the status of the recipient of the payment and the genuine activity carried on by foreign holding companies, and transfer pricing with regard to the consistency of the declared model with the actual settlements.

In the pharmaceutical industry the risk is higher than average, because group structures are complex, the values of intra-group transactions are large, and intellectual property licences and intra-group financing are the standard, not the exception. The entry into force of the JPK CIT further shortens the distance between filing a return and its verification.

Why are these areas at the top of the tax authorities’ list? There are several reasons. Above all, they concern large (often multi-million) amounts of payments made. It is also not without significance that the payments made are not so-called one-offs. Quite the contrary – group payments are made annually. If the authority verifies and assesses additional tax for one year, it can relatively “easily” transfer those findings to the settlements for the remaining open settlement periods.

Another reason is that, both in the area of WHT and TP, the provisions use highly imprecise, open-ended concepts. Which price is genuinely at arm’s length, who is the beneficial recipient, which services are similar – these are questions to which there are very often no black-and-white answers. And if that is so, they are susceptible to assessment and interpretation, and therefore also to challenge during an audit.

There is no closed list of documents that the authority may demand. The scope follows from which condition for the preference has to be demonstrated. In the case of holding structures, the material usually includes registration documents and the ownership structure, agreements and documentation of the flow of payments, data on the recipient’s personnel, premises and equipment, financial statements, as well as transfer pricing documentation with an analysis of functions, risks and assets.

This last element is sometimes underestimated. The local file is not a WHT document, but it describes the same circumstances on which the assessment of the recipient’s status is based. Any discrepancy between its content and the arguments presented in the withholding tax case is of evidentiary significance.

ALTO specialises in conducting such proceedings. We represent companies in transfer pricing and withholding tax audits, in proceedings for the refund of tax withheld, and in disputes at the appeal and court stage, before the voivodship administrative courts and the Supreme Administrative Court. We also prepare transfer pricing documentation, beneficial owner status analyses and applications for an opinion on the application of preferences.

 

FAQ

 

Is the PLN 2 million threshold in withholding tax the same threshold as in transfer pricing?

No, these are two separate constructions with a coinciding value. In transfer pricing, the documentation thresholds under Article 11k(2) of the CIT Act are PLN 10 million for commodity and financial transactions and PLN 2 million for service and other transactions, and they are calculated for a controlled transaction of a homogeneous nature, not for a single invoice or agreement. In withholding tax, the PLN 2 million under Article 26(2e) is the total of specified receivables paid to the same related entity in a tax year. Exceeding one threshold does not always mean exceeding the other.

 

What conditions have to be met in order to apply the exemption for interest and royalties?

The exemption under Article 21(3) of the CIT Act does not operate automatically. The conditions concern the status and residence of the companies in the European Union or the European Economic Area, the level of the relationship (as a rule, direct or indirect holding of at least 25 per cent of the shares), an uninterrupted two-year period of maintaining that holding, beneficial owner status, carrying on genuine business activity and not benefiting from an exemption covering all income. The Act allows for a situation in which the required period expires only after the payment has been made.

 

Can an opinion on the application of preferences expire before 36 months have elapsed?

Yes. In the event of a material change in the factual circumstances affecting the fulfilment of the conditions for the preference, the applicant has 14 days to inform the authority, counted from the day on which it learned of the change or, exercising due diligence, should have learned of it (Article 26b(8) of the CIT Act). If you report the change within the time limit, the opinion expires on the last day of the month following the month in which that time limit elapsed. If you do not report it, the opinion expires as early as the day on which the taxpayer ceased to meet the conditions.

The Ministry of Finance is at the same time planning to extend the validity period of the opinion on the application of preferences to 5 years. The status of the legislative work on this act needs to be monitored.

 

Who is liable for withholding tax not withheld by the Polish company?

The payer is liable for tax not withheld, or withheld and not remitted (Article 30 of the Tax Ordinance). Fiscal penal liability operates separately: Article 78 of the Fiscal Penal Code concerns failure to withhold tax or withholding it in an amount lower than that due, and Article 77 concerns tax withheld but not remitted on time. Under Article 9 § 3 of that code, liability may also attach to a person who in fact deals with the economic, in particular financial, affairs of the company.

This material is of an informational nature and does not constitute tax advice; the application of the principles described requires an analysis of the specific factual circumstances.

 

Sources

 

Legislation

• Act of 15 February 1992 on Corporate Income Tax: Article 4a(29), Article 11a(1)(4) and (2), Article 11c, Article 11e, Article 11g, Article 11k(2), Article 11n(1), Article 11q(1), Article 11t(1), Article 15c, Article 21(1), (3) and (7), Article 22(1) and (4), Article 22c, Article 24a(18), Article 26(1), (2e) and (7a), Article 26b, Article 28b
• Act of 29 August 1997 – Tax Ordinance: Article 14a § 1(2), Article 14n § 4(1), Article 30
• Act of 10 September 1999 – Fiscal Penal Code: Article 9 § 3, Article 77, Article 78

 

Case law

• Supreme Administrative Court, judgment of 5 July 2016, II FSK 2369/15
• Supreme Administrative Court, judgment of 6 October 2023, II FSK 1333/22
• Supreme Administrative Court, judgment of 6 May 2025, II FSK 1082/22
• CJEU, Grand Chamber judgments of 26 February 2019, the Danish cases: C-115/16, C-116/16, C-117/16, C-118/16, C-119/16, C-299/16

 

Individual tax rulings

• Director of the National Revenue Information Service, ruling of 3 September 2020, 0111-KDIB1-2.4010.220.2020.4.BG
• Director of the National Revenue Information Service, ruling of 5 August 2022, 0111-KDIB1-2.4010.301.2022.2.ANK

 

Official materials and industry standards

• Tax explanations of the Minister of Finance of 3 July 2025 concerning the application of the beneficial owner clause for withholding tax purposes, published on 9 July 2025
• Announcement of the Minister of Finance and Economy of 10 December 2025 on the type of base interest rate and margin for transfer pricing purposes, M.P. 2025 item 1249
• OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations 2022, Chapter VI

JPK_CIT has permanently changed the landscape of Polish accounting and tax reporting. The Standard Audit File for CIT taxpayers (commonly known as JPK_CIT) is no longer a distant plan of the Ministry of Finance – it has become a real requirement. This reform, based on the digitalisation of accounting books, has imposed on businesses an obligation to transmit data in a structured XML format.

Who must report, and when?

What does the new JPK_KR_PD structure look like?

Has the submission deadline been extended?

Below is a detailed analysis of the regulations in force in 2026.

 

What is JPK_CIT and why is it a revolution?

The introduction of the Standard Audit File for CIT is one of the final elements of tightening Poland’s tax system. Until now, tax authorities (KAS) could access accounting books mainly on demand – during inspections. From 2026 onwards (for the largest entities), this process becomes automatic and cyclical.

In practice, JPK_CIT is not a single file, but a new reporting standard that covers two main logical structures (schemas):

1. JPK_KR_PD – accounting books with corporate income tax data (an extension of the existing JPK_KR file).
2. JPK_ST_KR – a register of fixed assets and intangible assets (this obligation has been temporarily deferred).

The Ministry of Finance aims to be able to remotely verify the correctness of CIT settlements without the need to visit the company’s premises.

 

JPK_CIT implementation schedule: who does it apply to and from when?

The legislator has divided taxpayers into three groups, gradually extending the obligation to successive market sectors. It is essential to establish which group your company belongs to in order to prepare adequately for the new reporting obligations.

1. Group of “Large Taxpayers” and Tax Capital Groups (reporting for the 2025 tax year)

   These are the entities leading the way. The obligation to submit the JPK_KR_PD file for the 2025 tax year applies to:

   • Tax Capital Groups (PGK) – regardless of revenue.
   • The largest CIT taxpayers – companies whose revenue in the previous tax year (i.e. 2024) exceeded EUR 50 million.

   For these entities, Q2 2026 is the time to finalise the closing of books and generate XML files compliant with the latest schema published by the Ministry of Finance.

2. Group of VAT Taxpayers (obligation starting from 1 January 2026)

   This is the largest group, which has been in the reporting period for several months. It covers all CIT taxpayers who did not meet the EUR 50 million revenue threshold but are required to submit JPK_VAT records.

   • Important: This applies exclusively to taxpayers filing monthly VAT returns (JPK_V7M).
   • Obligation: From the first day of the tax year beginning after 31 December 2025 (i.e. typically from 1 January 2026), they must maintain books in a manner that enables JPK_CIT to be generated in the future.
   • First submission: Will take place in 2027 (for the 2026 tax year).

3. Group of Remaining Taxpayers (starting in 2027)

   This group includes entities filing quarterly JPK_VAT returns, entities not registered or registered as VAT-exempt, and specific organisations (e.g. family foundations). For them, the JPK_CIT reporting obligation will not apply until the tax year beginning after 31 December 2026.

 

JPK_CIT submission deadline: 31 March or 31 July 2026?

Under the CIT Act, the standard deadline for submitting accounting books in electronic form is the deadline for filing the annual CIT-8 return – i.e. the end of the third month after the close of the tax year (typically 31 March).

However, given the scale of technological challenges, the Ministry of Finance issued a regulation extending the deadline for the first year of reporting.

• New deadline: Under the regulation, for the largest taxpayers (Group I) the deadline for submitting JPK_KR_PD for 2025 has been moved to 31 July 2026.

In addition, advanced legislative work is underway to extend the JPK_CIT submission deadline for all CIT taxpayers subject to this obligation – the new deadline provides for submission of JPK_CIT by the end of the seventh month after the close of the tax or financial year.

The extended deadline will cover both JPK_KR_PD and JPK_ST_KR.

 

Logical structure of JPK_KR_PD – what does the file contain?

The new schema is much more than a digital balance sheet. It requires the “tagging” of accounting data so that the Ministry of Finance’s algorithms can understand the company’s tax specifics.

 

Key elements of the JPK_KR_PD structure:

1. Account tags (tax and accounting tags)*: The taxpayer must assign special tags from the Ministry of Finance’s dictionary to their chart of accounts. Tax tags distinguish, among others:
   • Non-taxable income – broken down into permanently and temporarily non-taxable revenue;
   • Costs permanently not constituting tax-deductible expenses (NKUP);
   • Costs not constituting tax-deductible expenses (NKUP) in the current year;
   • Tax-deductible costs and revenues in the current year, recognised in prior-year books;
   • Tax-exempt income;
   • Costs related to research and development activities.
2. Journal – a detailed record of all business transactions entered in the taxpayer’s accounting books.
3. Counterparty data in the journal: Every accounting entry relating to a transaction with a counterparty must include that party’s Counterparty Number, which is then linked to the Tax Identification Number (NIP) in the Counterparty register. This is a revolutionary change for companies that have previously posted cost invoices collectively or without full entity-level analytics in the general ledger.
4. RPD note – a summary reconciliation of the tax result to the accounting result, specifying the differentiating items (optional for 2025).

* The application of tags for entities preparing their financial statements under IFRS has been deferred to the tax year beginning on 1 January 2028.

 

Penalties and fiscal penal liability

Disregarding the new reporting obligations carries the risk of liability under the Fiscal Penal Code (KKS).

• Failure to submit the JPK_CIT file: May be treated as obstruction of a tax inspection or failure to fulfil a reporting obligation, subject to a fine.
• Submission of an unreliable file: If the data in the XML file (e.g. KUP/NKUP tags) is inconsistent with the actual state of affairs and results in an understatement of the tax liability, penalties may be significantly higher.
• Personal liability: Responsibility for the correctness of the books and JPK reporting lies with the head of the entity (Management Board) and persons entrusted with managing financial affairs (e.g. the CFO, Chief Accountant).

 

FAQ – JPK_CIT: questions and answers

 

If I am a quarterly VAT taxpayer, does JPK_CIT not apply to me in 2026?

That is correct. The legislator has included in the group starting in 2026 only those taxpayers who are required to submit monthly VAT records (filing JPK_V7M). If you file JPK_V7K, you must adapt your books from 1 January 2027.

 

Does JPK_CIT replace the CIT-8 return?

No. The CIT-8 return remains mandatory, regardless of the introduction of JPK_CIT. JPK_KR_PD is a supplementary document serving inspection and analytical purposes.

 

Do I need to use KSeF to submit JPK_CIT?

Formally, these are two independent obligations and systems; however, they are closely linked analytically. The KSeF invoice number should appear in the records, and the Head of KAS will use KSeF data to validate the accuracy of entries in JPK_CIT and JPK_VAT.

 

Can an accounting firm sign JPK_CIT?

Advanced legislative work is underway to introduce provisions that would allow tax books in income taxes to be signed on the basis of a power of attorney for signing declarations submitted by electronic means of communication (UPL-1). This solution will enable accounting firms to sign JPK_CIT.

 

Sources and legal basis (as of April 2026)

• Act of 29 October 2021 amending the Personal Income Tax Act, the Corporate Income Tax Act and certain other acts – the act introducing JPK_CIT and setting reporting deadlines for individual groups of taxpayers;
• Act of 15 February 1992 on corporate income tax – legal basis for submitting books in JPK_CIT format;
• Regulation of the Minister of Finance of 16 August 2024 on additional data with which accounting books subject to submission under the Corporate Income Tax Act must be supplemented – specification of additional data required in JPK_CIT;
• Regulation of the Minister of Finance of 13 December 2024 on the exemption from the obligation to submit parts of accounting books under the Corporate Income Tax Act – exemption from submitting the fixed assets and intangible assets register;
• Regulation of the Minister of Finance and Economy of 15 December 2025 amending the regulation on additional data with which accounting books subject to submission under the Corporate Income Tax Act must be supplemented – exemption from applying account tags for entities preparing financial statements under IFRS;
• Regulation of the Minister of Finance and Economy of 16 February 2026 on the extension of deadlines for submitting accounting books in respect of corporate income tax – extension of the JPK_CIT submission deadline;
• Act of 10 September 1999 – Fiscal Penal Code – penalties for failure to submit, errors or delays in JPK_CIT submission;
• Technical documentation of the Ministry of Finance – official XSD schemas and information brochures published on the podatki.gov.pl portal.

 

ALTO’s support in the area of JPK_CIT

Implementing JPK_CIT is a process that requires combining accounting and tax expertise with IT knowledge. If you wish to verify whether your company is ready to report in 2026, or if you need support in preparing for the new reporting obligation – contact our experts.

Our team will assist with analysing existing accounting and tax processes and adapting them to JPK_CIT requirements, ensuring full compliance with the Minister of Finance’s regulation.

We offer support with both the technical aspects of reporting, such as system configuration or the use of the ALTOOL JPK_CIT application enabling reporting, and substantive guidance on interpreting the new regulations. Drawing on our experience, ALTO can help companies identify areas requiring improvement, implement appropriate control procedures and ensure a smooth transition to the new legal requirements.

Contact us to obtain detailed information on JPK_CIT support and other tax and accounting services offered by ALTO.

The expansion relief, although intended to support the growth of Polish companies, is increasingly becoming the subject of disputes with the tax authorities and courts.

The most recent Supreme Administrative Court (NSA) rulings clearly narrow the possibility of using the preference by entrepreneurs outsourcing production to third parties. In addition, disputes concerning the interpretation of “products not previously offered” – a key concept for eligibility – are dominated by a restrictive approach.

Below we analyse the current positions of tax authorities and courts, and their practical implications.

 

What is the expansion relief and what conditions must taxpayers meet?

The expansion relief, regulated under Article 18eb of the CIT Act, allows taxpayers to deduct – in addition to the standard cost recognition – expenditure incurred to increase revenue from product sales. The maximum deduction is PLN 1,000,000 per tax year.

The catalogue of qualifying costs includes, among others:

• promotional activities,
• participation in trade fairs,
• preparation of documentation enabling the sale of products (including product certification),
• adaptation of product packaging to meet customer requirements.

A taxpayer may use the deduction if, within two consecutive tax years (counted from the year in which costs related to revenue growth were incurred), at least one of the following conditions is met:

• an increase in revenue from the sale of existing products,
• achieving revenue from the sale of products not previously offered, or
• achieving revenue from the sale of products not previously offered in a given country.

Practice shows that the key disputes concern two issues: whether a taxpayer outsourcing production to third parties may use the preference, and how to define a product “not previously offered”.

 

Outsourced production and the expansion relief – a uniform and restrictive line of case law

A particular source of controversy is the eligibility of entities that do not carry out their own production but instead outsource manufacturing to external parties. In recent years, administrative courts have issued a series of rulings which – though delivered at different times and in different factual circumstances – consistently point in one direction: they narrow the interpretation of “product manufacturing” within the expansion relief.

One of the most recent cases concerned a taxpayer operating in the brewing industry who does not carry out its own production. The company was responsible for developing recipes and quality standards, while the actual brewing was outsourced to external subcontractors. The finished product was then sent to a bottling facility where the company packaged it into bottles, cans and kegs before selling it to shops, restaurants and distributors.

The Director of the National Revenue Information Service (0111-KDIB2-1.4010.378.2022.1.AR) and subsequently the Regional Administrative Court (WSA) in Bydgoszcz (I SA/Bd 8/23) held that merely developing a recipe, supervising the process or packaging the product does not constitute manufacturing activity. The court indicated that, for the purposes of the relief, actual production of goods is required – not merely participation in the production process in the capacity of the commissioning party.

This position was unequivocally upheld by the Supreme Administrative Court (II FSK 798/23). The NSA held that outsourcing production to third parties precludes fulfilment of the “product manufacturing” condition for the purposes of the expansion relief.

 

Outsourced production – a uniform interpretation

The NSA adopted a similar position in December 2025 in a case concerning a cosmetics company (II FSK 406/23).

An equally restrictive interpretation of outsourced production is presented in rulings of the Regional Administrative Courts in Poznań (I SA/Po 822/23), Lublin (I SA/Lu 33/23) and Gliwice (I SA/Gl 1280/23).

It can therefore be concluded that the courts consistently confirm that an entity outsourcing the manufacturing of products to subcontractors does not meet the “product manufacturing” condition and therefore cannot benefit from the expansion relief.

 

Products not previously offered

The second area of dispute concerning the expansion relief is the interpretation of “products not previously offered”. This term appears in the legislation, but the legislator chose not to define it. The absence of a statutory definition has led tax authorities to rely on non-normative materials – primarily the draft tax explanations on the expansion relief provisions of 25 September 2023 – even though this document was never issued in final form and has no binding force.

 

Restrictive position of authorities and unfavourable WSA case law

In an interpretation of 23 August 2024 (0111-KDIB1-3.4010.324.2024.1.JG), the authority – citing the draft tax explanations – indicated that a product “not previously offered” must differ from previous products in kind, not merely in quality, composition or target customer group.

As a result, the authority concluded that if a company producing waters and beverages intends to introduce new variants to the market – even those clearly differing in recipe, technology or properties – these will not constitute “products not previously offered”.

An analogous position was taken by the Regional Administrative Court in Warsaw in rulings of 10 January 2025 (III SA/Wa 2504/24) and 15 April 2025 (III SA/Wa 426/25).

As a consequence, this line of interpretation holds that:

• a change in composition, technology or packaging is a modification, not the creation of a new product,
• an entrepreneur who does not categorically change their industry or product group essentially does not meet the statutory condition.

Such a far-reaching interpretation leads in practice to absurd outcomes – for example, a fizzy drinks manufacturer would be unable to obtain the relief after commencing juice production, even though the average consumer regards these products as entirely different.

 

Functionality and market segment as a criterion for “novelty”

The Regional Administrative Court in Gliwice diverged from this restrictive trend, issuing a taxpayer-friendly ruling (I SA/Gl 1356/24). The court expressly stated that the classification of products within the relief should not be so narrow.

The WSA noted that the beverages market is inherently diverse – encompassing, among others, carbonated drinks, still drinks, waters, juices, isotonic, energy and vitamin drinks. Each of these constitutes a distinct type of product, differing in properties, intended use and target consumer. Therefore, if a taxpayer has previously produced only still water and plans to introduce sparkling or highly mineralised water, these are “products not previously offered”.

This ruling gives the concept of a “new product” a meaning that takes into account:

• the actual market segment,
• the intended use and functional characteristics of the product,
• the perception of differences by consumers,
• the role of functional and technological changes in the product portfolio.

The court also observed that the definition of novelty must be practical and reflect market realities – otherwise the relief would essentially fail to achieve its purpose.

 

The expansion relief requires an interpretive correction

Such an interpretation is out of step with modern business realities – outsourcing production is today the norm, and entrepreneurs typically develop their offering within their existing business profile rather than by introducing products that are “categorically different”.

Although in the case of outsourced production it is difficult to entirely disregard the literal wording of the legislation, particularly with regard to the concept of “products not previously offered”, the tax authorities are creating additional restrictions that do not follow from the statute.

As a result, such a restrictive interpretation not only excessively narrows access to the expansion relief, but also undermines its pro-growth purpose – which clearly shows that this is an area requiring urgent revision, whether at the level of interpretation or legislative intervention.

 

If you are considering implementing or reviewing tax reliefs in your organisation – including the expansion relief, robotisation relief, innovative employees relief, R&D relief or others – contact the ALTO Advisory experts!

The CSRD Directive, or the EU Corporate Sustainability Reporting Directive, is a regulation that has fundamentally changed the business landscape. Although the original scope was very broad, a series of amendments in 2025–2026 has made this process a challenge not only operationally but also legally for many companies.

As of April 2026, this topic is no longer merely theoretical – the provisions have entered into force, but recent changes to the reporting thresholds and the so-called “stop-the-clock” directive have significantly shifted the timeline.

In this article we explain how these regulations affect business, what ESRS standards are, and why reliable sustainability reporting remains a priority for management boards despite the changing thresholds.

 

What is CSRD and what does it mean for companies in Poland?

CSRD stands for Corporate Sustainability Reporting Directive. It is a landmark piece of legislation that replaced the previous NFRD (Non-Financial Reporting Directive). The legislator’s main objective is to ensure that every investor or bank has access to comparable data on a company’s impact on the environment and society.

In Poland, the legal situation regarding non-financial reporting has been subject to rapid change in recent months. Although the original transposition of the CSRD took place through the Act of 6 December 2024, subsequent modifications resulted from the adoption at EU level of the Omnibus I simplification package.

A key moment was the publication on 13 March 2026 of the Act of 27 February 2026 amending the Accounting Act, which transposes into Polish law the option of exemption from ESG reporting for 2025 and 2026. This Act implements EU Directive 2026/470 and introduces a significant relaxation of reporting obligations through a substantial raising of thresholds. From 2027, reporting will apply only to the largest companies employing more than 1,000 employees and achieving very high revenues.

In practice, this means that many companies that prepared an ESG report for 2024 may lawfully refrain from reporting for 2025 and 2026, provided they do not meet the new criteria. This decision is voluntary and rests with the company’s management board.

 

CSRD versus NFRD – how the approach to data is changing

CSRD significantly raises the quality and verification requirements for non-financial data. Even with the reduced number of entities in scope in 2026, the standard remains uncompromising.

The key pillars of change are:

• Precision: The reporting process under CSRD can no longer be based on self-selected indicators – ESRS standards are mandatory.
• Digitalisation: Reports must be prepared in XHTML format.
• Verification: Reporting must be confirmed by a statutory auditor (assurance). As a result, an ESG report carries the same weight as annual financial reporting.

 

Who is subject to the obligation in 2026? (Current schedule)

This is the key question for every manager this year. As a result of the European Parliament’s decision in December 2025, the reporting obligation has been drastically limited to the largest entities.

The position as of April 2026 is as follows:

• New main threshold: Under the latest changes, the ESG reporting obligation now applies only to entities meeting two conditions: more than 1,000 employees and net revenues above EUR 450 million.
• Wave I (reporting for 2024): The largest public-interest entities (under the old thresholds) submitted reports in 2025. Under the new Act published on 13 March 2026, if these entities do not meet the new thresholds, they may voluntarily take advantage of the exemption from ESG reporting for 2025 and 2026.
• Waves II and III – deferral (“stop-the-clock”): Other large entities and listed SMEs have been given more time. Their deadlines are now 2028 (for 2027) and 2029 (for 2028) respectively.

Under the rules in force since March 2026, companies employing fewer than 1,000 employees are no longer in a state of regulatory uncertainty. Under the new thresholds they are not within the target scope of the CSRD and may lawfully refrain from ESG reporting for 2025 and 2026, provided that an informed decision to this effect is taken by the management board.

It is worth noting, however, that March 2026 was for many organisations the month in which reports were published – reports prepared under conditions of prolonged regulatory uncertainty. Some companies, despite the opening of a path to exemption, chose to publish a report for 2025, driven by, among other things, the need for reporting continuity, the expectations of stakeholders, banks and business partners, or a desire to consolidate the maturity of ESG processes within the organisation.

 

What specifically must be disclosed? ESG areas and standards

To meet the rigorous requirements of CSRD, an organisation must prepare a report based on the European Sustainability Reporting Standards (ESRS). It covers three main areas:

• Environmental (E): Climate change, pollution, water, biodiversity and ecosystems, and circular economy.
• Social (S): The situation of own employees and those throughout the value chain, affected communities, consumers and end users.
• Governance (G): Business conduct, including business ethics and management transparency.

 

Double materiality – the heart of the process

The foundation is the double materiality assessment. Every entity must assess reality from two perspectives: the company’s impact on its surroundings, and financial considerations (how ESG risks and opportunities affect the company’s financial results). Only material issues are included in the report, and this process must be thoroughly documented for the auditor.

 

How to prepare your company for CSRD – a practical guide for 2026

Implementing the directive’s requirements calls for a systematic approach:

1. Gap analysis: Assessment of ESG data availability and the degree to which policies and procedures have been implemented.
2. Legislative monitoring: Tracking work on simplified ESRS standards and observing what final solutions are adopted in the legislative process.
3. Data management: Organising information on what ESG data is already available within the organisation, where it is held and who is responsible for it, so that the company can prepare efficiently for reporting.
4. Cooperation with the auditor: Preparing processes for verification by a statutory auditor.

 

CSRD and the value chain – indirect obligations for smaller companies

Despite the raising of the threshold to 1,000 employees, the CSRD indirectly affects many more companies. The largest players collect data from their entire supply chain (upstream and downstream). In March 2026, smaller businesses are receiving large volumes of enquiries about carbon footprints and labour standards. Companies that are able to respond to these are building a significant competitive advantage.

 

Summary: ESG in Poland after the 2026 changes

The Corporate Sustainability Reporting Directive has evolved towards simplification and reducing the burden on smaller businesses. 2026 is a year of scrutiny for the largest entities (above 1,000 employees) and a time of strategic calm for the rest of the market. It is worth bearing in mind, however, that ESRS standards are becoming the universal language of European business.

 

FAQ – Questions about the new regulations

 

What is the “stop-the-clock” directive?

This is a 2025 regulation that deferred reporting deadlines for medium-sized and smaller entities by two years.

 

Is the 250-employee threshold still applicable under CSRD?

Following the December 2025 changes, the threshold was raised to 1,000 employees, which significantly narrowed the group of companies subject to the direct reporting obligation.

 

Does an ESG report need to be verified by an auditor?

Yes – regardless of the size of the company, if it falls within the scope of CSRD, its report must undergo an assurance process conducted by a statutory auditor.

 

Sources:

• Directive (EU) 2022/2464 (CSRD).
• “Stop-the-clock” Directive (EU) 2025/794.
• Draft Act UC136 (introducing the 1,000-employee and EUR 450 million revenue thresholds).
• Act of 27 February 2026 amending the Accounting Act.