On 20 March 2024, the Sejm amended the Accounting Act, which constitutes the transposition of Directive 2021/2101 of 24 November 2021. The provisions of the directive represent part of the European Commission's package on countering tax avoidance by multinational companies. An estimated EUR 50 - 70 billion is lost by the EU annually as a result of such activities.

The amended Act imposes a reporting obligation on large multinationals, which will disclose information on income tax paid and other tax-related information.

The data contained in the report will have to be disclosed separately for all European Economic Area (hereinafter: EEA) countries in which the company concerned operates, as well as for so-called ‘tax havens’.

The obligation will affect companies that have their registered office or place of management in the territory of the Republic of Poland (RP), as well as companies from outside the EEA that conduct business activities in the territory of the RP through a branch or subsidiary.

The regulation will cover, in particular, members of dominant capital groups and independent entities whose revenues will exceed PLN 3.5 billion in two consecutive financial years. This implies that an entity will be subject to the reporting obligation even if it does not exceed the aforementioned threshold in one of the subsequent financial years.

The report will primarily include information on:

• the name of the entity and a list of all subsidiaries included in the parent company's consolidated financial statements;
• a description of the nature of their activities;
• the number of employees on a full-time equivalent basis;
• the amount of revenue, including from transactions with related parties;
• the amount of income tax payable in the financial year;
• the amount of income tax paid in the relevant financial year, including withholding tax;
• the amount of retained profit from previous years.

It is worth mentioning that companies have already been submitting the aforementioned data to the tax authorities for a long time, but until now such data have not been available to the public.

Entities will be required to report for the first time for the financial year beginning after 21 June 2024. Auditors are to monitor whether companies actually comply with this obligation when auditing their financial statements.

Such statements are to be filed with the National Court Register and posted on the company's website and available for at least five years.

Żaneta Zakrzewska, Tax Consultant, ATA Tax Sp. z o.o.

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