As of May 16, 2022, epidemic status in Poland ceased and epidemic emergency began. This decision will have several implications, which we address below.
To begin with, it should be mentioned that the amendment will not have any effects in the context of labor law. The state of epidemic threat does not change anything in the context of the regulations on performing remote work, referring employees for overdue leave and periodic examinations. We would like to remind you that the employer has the right during the state of epidemics, state of epidemic threat and three months after their cessation to order an employee who has such technical capabilities to work remotely. In addition, the employer has the right to indicate, without the consent of the employee, the date on which he will be obliged to use his unused vacation from previous years up to a maximum of thirty days. The following employee examinations are also suspended: control examinations, preliminary examinations and periodical examinations.
The change will also not affect the deadline for issuing an individual interpretation. The deadline has been extended by 3 months in relation to cases pending or submitted after 31 March 2020. This will continue to be the case.
The legislator has also decided not to introduce changes in the context of public administration bodies. Here the obligation to inform about certain deadlines will not be required. It is the party that will have to remember about time limits, lapses or deadlines for performing actions.
The first significant tax change is the withdrawal of the COVID-19 donation deduction. As a reminder, you could, for the duration of this deduction, reduce the CIT and PIT tax basis of donations made to counter COVID-19 to selected institutions/NGOs. The entitlement applied to funds donated from January 1, 2020 through the end of the month in which the end of the epidemic status was declared. The amendment also deals with the possibility of one-time depreciation of fixed assets used for production of goods related to counter COVID-19.
With the withdrawal of the epidemic status, the possibility to apply 5% PIT/CIT for qualified IP income used to counteract COVID-19 will also expire. The preference in question will cease to be valid until the end of May for CIT and until the end of this year for PIT taxpayers. The right to account in PIT/CIT advances for qualified R&D costs incurred to develop products necessary to counter COVID-19 will also expire.
The exemption from tax on revenue from buildings will also cease to apply. The exemption referred to buildings owned or co-owned by a taxpayer, which were given away in whole or in part for use on the basis of a lease, tenancy or similar agreement, located in the territory of the Republic of Poland. The exemption will be valid until the end of the month in which the change from epidemic to epidemiological status has been decided, i.e. until the end of May 2022.
Along with the transition, tax preferences will also cease to apply as of the end of this year: the first one is the bad debt relief in which taxpayers did not have to increase the tax base in advance payments by the value of unpaid liabilities which were at the same time included in tax costs by them. The second preference is the increase of the PIT exemption limit for benefits from the Social Benefits Fund (ZFŚŚ), i.e. the exemption limit for allowances paid out from the funds of a trade union organization to employees who belong to such an organization, allowances related to fortuitous events or natural disasters or subsidies to holidays for children and young people.
In summary, the change in the epidemic state will not have a glaringly large impact on taxpayers; these are largely cosmetic changes for now, but they should be kept in mind. Given that the state of epidemic emergency maintains a sizable portion of the “covid” regulations, we can only expect quite a revolution with the change.