COVID-19 and the “Anti-crisis Shield” – proposals by the government
Polish government, is preparing a set of solutions / tools that aim at mitigating the negative business and economic consequences caused by the COVID-19 pandemic. More details on the draft law should be known by the end 20.03.2020 or early the following week (it should be passed in a special, express path), but already at this stage there are some information what the package will contain. In general, the Shield will be focused on helping the employers and employees to sustain the workplace, it is also targeted at small and medium business enterprises. It includes also certain solutions to sustain the liquidity of the companies.
The key proposals include:
- With respect to administrative deadlines:
- At this stage there are no official declarations on postponing the CIT-8 form filing term (due 31.03) but it is being discussed – for now, entities other than NGO’s operating in Poland will be still obliged to file CIT yearly declaration, as well as fulfil other reporting obligations such as preparing statutory accounts and MDR-3 forms within regular terms;
- For the taxpayers obliged to file the TP-R before 30.09.2020 – the respective deadline should be extended till 30.09.2020
- There is also possibility that deadline for filing of the PIT return will be postponed till end of May (instead of end of April)
- Payment of taxes / social contributions:
- Deferral of social contributions payments for a three months
- Postponing the final term to pay the minimum tax on commercial real estate for March – May 2020 until 20 July 2020 – for taxpayers generating revenues at least 50% lower than in the corresponding month of 2019; this possibility would be also open for taxpayers which did not reveal tax revenues in the previous tax year, however in March-May 2020 bear negative consequences of pandemic in economic terms;
- Postponing the deadline to pay advances for employees’ income tax for March and April 2020 until 1 June 2020;
- Option to resign from simplified advances for March – December 2020 for small taxpayers only – which would have the possibility to calculate advances on the basis of current income;
- The temporary cancellation of prolongation fee on the installment payment or deferral of the deadline to pay tax due, social contributions and tax arrears that constitute state budget income during the epidemic period;
- The possibility for municipalities to introduce the exemption from the Real Estate Tax or deferral of payments for the entrepreneurs in respect to the negative economic consequences born by them due to coronavirus;
- Deferral of entry into force of certain provisions:
- The deferral of the JPK_VAT obligation until 1 July 2020;
- The deferral of the notification to the Central Registry of Beneficial Ownership (CRBR) until 1 July 2020;
- The deferral of entry into force of the retail tax till end of 2020
- At this stage there are no declarations that there will be postponement with respect to for example new VAT rates matrix (which is supposed to enter into force as of 1.04.2020) or new withholding tax regime (as of 1.07.2020)
- With respect to employee / employer:
- Partial takeover of employee related costs by state treasury (40:40:20 rule)
- Other discussed tax and legal solutions:
- The possibility to use losses from 2020 backwards – taxpayers would be entitled to deduct the maximum of PLN 5 m loss incurred in 2020 from 2019 income (the surplus over PLN 5m threshold to be deducted in subsequent tax years) provided the 2020 revenue does not exceed 50% of revenue generated in 2019;
- The increased elasticity of the National Tax Administration (KAS) in the pursuance of tasks in the crisis situation. The possibility to suspend tax and duty-tax controls and tax litigations during the epidemic period at a tax payers request or by the KAS / MF itself.
- The possibility to withhold administrative enforcement proceedings of pecuniary claims (prerogative of the government)
- Under certain conditions: exemption from mandatory bad debt relief regulations in income taxes with regard to debtors’ obligation to include unpaid debts in calculation of income tax advance payments
- Introduction of the possibility to deduct donations (monetary and in-kind) provided for the purposes related to coronavirus pandemic from CIT / PIT tax basis;
- The authorities of the municipality will be allowed to postpone the payments for perpetual usufruct
- There are also certain solutions dedicated to TSL and tourism sector
- Actions already taken by the Ministry of Finance
- Pursuant to the regulation of the Ministry of Finance, the Bank Gospodarstwa Krajowego (BGK, national development bank) is entitled to grant guarantees on credit repayment in the de minimis form for micro, small and medium enterprises. The change of the Regulation allows to cover up to 80% credits with the guarantees. The provision fee on these guarantees was lowered to 0%.
In CRIDO we have prepared a set of tax and legal solutions that can be used now to sustain the liquidity (e.g. discussion of the terms of contracts from the perspective of force majeure, deferral of tax payments / returns on existing rules). We are also ready to give our support in implementation of the solutions / tools provided by the “Anti-crises Shield” when needed.