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New withholding tax rules


by Piotr Ziółkowski

17 January 2022


The Polish Deal regulations upgrading the withholding tax system in Poland became law on 1 January 2022.

Withholding tax system


After a period of suspension, the "pay and refund" mechanism may be used for certain payments.

From the beginning of this year, the withholding tax system depends on:


  • type of payment (object-oriented criterion);
  • status of the payee as an associate or independent entity (subject-oriented criterion) and
  • total amount of payments made to a taxpayer (value criterion).


In addition, the concepts of due care, beneficial owner and the rules for using a copy of a certificate of residence have been redefined.

Other WHT changes

  1. Now the "pay and refund" mechanism may only be used for payments involving royalties, interest and dividends.
  2. The lawmakers have made it clear that when assessing whether a withholding agent wishing to apply a preferential WHT rate or an exemption has exercised due care, not only the nature and scale of the Polish withholding agent's business but also its relationships as defined in transfer pricing regulations are taken into account.
  3. A provision has been introduced under which the taxpayer's place of residence may be confirmed with a copy of a certificate of residence.
  4. An opinion on eligibility for preferences has replaced an opinion on eligibility for exemption.
  5. The concept of beneficial owner has been redefined.


The Ministry for Finance has also announced that it will publish explanatory notes on the new withholding tax system.

Rödl & Partner's recommendations


In the context of the new regulations, we recommend:


  • reviewing contracts and transactions with foreign contractors for compliance with currently applicable tax obligations;
  • checking payments made to associated enterprises;
  • developing internal procedures regulating the rules of liability for payments made to foreign entities. These procedures will allow Polish companies and their management board members to manage risk.


If you have any questions about the withholding tax system or need assistance with the changes, you are welcome to contact Rödl & Partner experts.


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Anna Harasimowicz

Auditor (Poland)

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