Emerging Markets Rates and Currencies Handbook

Bank Handlowy wWarszawie S.A., Senatorska 16, 00-923 Warszawa FX Sales Contact: +48 22 657 7678 Tax Summary – Poland Poland W/H Tax • 20% WHT • Under certain tax treaties, can be reduced up to 0% if income recipient is a beneficial owner • 20% WHT • Under certain tax treaties, can be reduced to 0% if income recipient is a beneficial owner • No WHT • As a rule, derivatives are not subject to WHT* • 19%WHT on Dividends • Under certain tax treaties can be reduced • WHT exemption - dividends paid to corporates in EU and EEA. Basic requirement: foreign beneficiary to hold min 10% shares for min 2 years Deductibility of interests • Generally deductible, if associated with earning revenue • Thin cap: deductibility disallowed to the extent Net Interest Cost > 30% Tax EBITDA • Safe Harbour provision: PLN 3mm tax deductible interest p.a. Non-deductible interest can be carried forward and deducted in 5 subsequent years. • Starting 1 Jan 2020: new Notional Interest Deduction (NID) deduct hypothetical costs of external capital if additional payments to capital or retained profits. Max NID is PLN 250,000 p.a. • Generally deductible, if associated with earning revenue • Thin cap: deductibility disallowed to the extent Net Interest Cost > 30% Tax EBITDA • Safe Harbour provision: PLN 3mm tax deductible interest p.a. Non-deductible interest can be carried forward and deducted in 5 subsequent years. • Thin cap restrictions do not apply to FI’s • As a rule, derivative payments could be recognized as tax deductible** • N/A Country Deductibility and Considerations Inter-Co Debt Offshore Bank Loans Offshore Local Borrowing Derivatives Equities