The Ministry of Health's statement of February 18, 2022 on persons appointed to serve on boards of legal entities.
The provisions of the Polish Deal in force since January 1, 2022 have implemented numerous amendments with respect to the calculation and payment of health insurance contributions. Among them is the implementation of compulsory payment of such contributions by members of management boards and companies’ general representatives (PL prokurent). In response to the doubts which have arisen concerning the implemented provisions, the Ministry of Health, in its brief of February 18, 2022, decided to dispel some of them.
The first issue was to clarify the definition of remuneration. According to current legislation, remuneration should be understood broadly as any form of revenue recognised by tax law. This is because the legislator has linked the manner of determining the obligation to pay contributions to the way in which tax obligations arise, but Art. 66 (1) (35a) of the Act on Health Benefits does not refer to any specific source of revenue within the meaning of the Personal Income Tax Act. Thus, any revenues derived from a function on the grounds of appointment will constitute a basis for calculating health contributions.
In addition, the Ministry of Health referred to an issue that had given rise to a lot of doubts from the outset, i.e. the taxation of companies’ general representatives. The amendments introduced under the Polish Deal have extended the duty to pay health contributions to appointed to fulfil this function by virtue of appointment. However, notably, rather than being appointed, general representatives are merely granted a (general) power of attorney.
The Ministry underlines that the act of granting a general commercial power of attorney is composed of the decision to grant a general power of attorney and the appointment of a general representative, the latter being a decision as to the person to whom the general power of attorney is granted. Thus, in the opinion of the Ministry, it means that a general power of attorney is granted, but a general representative is appointed. Thus, it can be understood that establishing general representation results in the appointment of a general commercial representative. At the same time, the Ministry indicates in the document that the appointment of a general representative is an action that falls within the scope of reference of the expression "act of appointment", and hence, under Article 66 (1) (35a) of the Health Benefits Act, general representatives are covered by the compulsory health insurance.
Interestingly, the brief articulates the legislator’s intention in introducing the changes in question. The Ministry indicates that the approach aims at "providing additional funds in the public health insurance system and a fuller implementation of the principle of social solidarity". One can expect that such an explanation will not help taxpayers to come to terms with the imposition of further fiscal obligations. In contrast, the Polish Deal, which was supposed to be a positive solution for taxpayers, has once again proven to be negative in its consequences for yet another group of taxpayers.
One should bear in mind that announcements of the Ministry of Health do not establish binding law, but nevertheless indicate the guidelines for interpretation of legal regulations.
Kinga Duszna, Tax Consultant, ATA Tax Sp. z o.o.
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